Property disputes are set to soar as £2.5bn of office leases come to an end, real estate lawyers at Irwin Mitchell have predicted.
Irwin Mitchell said it expects a significant rise in the number of dilapidation disputes as a result of the expiry in the first half of 2015 of 2,500 office leases across the UK valued at £2.5bn.
Data from EGi was used and showed the lease expiries cover some 3.6bn sq ft of office space.
Out of all the leases expected to expire between January and June 2015, 12.5% are long-term tenancy agreements for 15 years or more.
The issue of dilapidations relates to the obligation that tenants face at the end of the lease to return the property to the landlord in a good state of repair, condition and decoration.
On large premises, dilapidation claims can in some cases run into millions of pounds and have a considerable impact financially as the business will usually have taken on additional costs and responsibilities with new offices.
Paul Firth, national head of real estate at Irwin Mitchell, said: “We’ve seen a steady rise in the number of dilapidation disputes and I expect to see the numbers continue to go up as the number of long-term leases come to an end.”
joanna.bourke@estatesgazette.com
