Signing a new lease for a commercial space in Sydney is a big commitment for any business. It’s essential to be as informed as possible about the space and building that it’s in before signing any agreements. This is where a condition report is invaluable.
A condition report is an essential tool that protects tenants by providing a clear picture, and report of the property’s current state, before you sign the lease. Having this on hand will save you from unexpected costs, disputes, and headaches down the line. At Niche Tenant Advisory, we can help ensure you’re protected and making an informed decision when it comes to a new commercial property in Sydney.
Click here to speak to our team today, or read on to find out more about the importance of a detailed condition report by experts.
What is an office condition report?
A condition report is a documented assessment of a property’s physical state. This type of report can be conducted before a lease, as well as at other times. It can be ordered by both landlords and tenants, protecting both from disputes over issues with the structure that may come about down the track.
The report records the current condition of various features, like the walls, floors, electrical systems, and plumbing. It details any existing damage, signs of wear and tear, and potential issues that may arise. We ensure that images are included, along with drone footage if requested and/or required.
For tenants, a condition report by Niche Tenant Advisory provides detailed insights about the property you’re considering, ensuring that you know exactly what you’re getting. This can help provide a stronger negotiating position, and ensure you’re not paying for repairs in future that aren’t your responsibility.
7 reasons why you need a condition report before a commercial lease
If you’re planning to lease a new office space or other commercial space in Sydney, being fully aware of the condition of the space is critical. A condition report is an essential investment and can save you a large amount of time and money in future. Here are 7 reasons why you should invest in a commercial condition report from the experts before signing a new lease.
Find existing issues with the structure
A condition report involves a thorough inspection and report on the property’s condition, including structural issues that might not be visible to the untrained eye. This can include problems like roof leaks, deteriorating walls, or plumbing issues.
Finding these issues before signing any documents means you won’t be liable for them, and it helps you to negotiate with the landlord to fix these issues (or lower the rent) before moving in. Uncovering any hidden damages or issues also means that if repairs are necessary, they can be done without disrupting your business operations once you’ve settled in.
Improve your negotiating position
A detailed condition report provides information that will ideally improve your negotiating position. If the report reveals a large amount of existing wear and tear, especially issues that require repairs or present a safety hazard, you may have grounds to negotiate for a rent reduction. You can also request that the landlord cover the repair costs or make upgrades before your lease begins.
In many cases, landlords are willing to make concessions for tenants who provide evidence of the property’s current state. This can save you money from the outset and ensure a safer and more pleasant workspace for your business. At Niche Tenant Advisory, we’ll not only conduct an inspection of the space and provide a condition report – we can also negotiate hard on your behalf, to ensure you get the best deal.
Ensures your makegood obligations are crystal clear
One important aspect of commercial leases is the makegood obligation, which details the tenants’ responsibilities around returning the property to its original condition when the lease ends. A condition report provides a crystal clear, documented record of the property’s state at the start of the lease. This means there will be an objective, shared understanding between you and the landlord of what “original condition” means, reducing the likelihood of costly disputes over repair or restoration obligations when your lease comes to an end.
Avoid unexpected repair costs
If you sign your new lease without a condition report, you might only discover structural or maintenance issues after moving into the new space. This can lead to unexpected and hefty expenses for repairs, as well as costly disruptions to your business. In short, it’s simply not worth the risk of wearing these costs down the track.
For example, an unnoticed plumbing issue could cause costly water damage, or an air conditioning system in poor condition might need urgent replacement. By spotting these issues before signing, you can budget more accurately and, if possible, request that the landlord conduct these repairs. This step helps you avoid the financial stress of unforeseen repairs and maintain your budget predictability.
Provide support for later insurance claims (if needed)
A condition report is extremely useful if you need to make an insurance claim for damage that occurs during your tenancy. Whether there’s a severe storm, flooding, fire, or accidental damage, insurance companies will scrutinise claims closely to ensure that damage wasn’t already there. A quality report that clearly shows the original condition with photo and even video evidence will place you in a better position when validating insurance claims.
Better insight for space planning
Planning the layout of your new office or renovating is a key part of customising the space to suit your business needs. A condition report provides better insight into the property’s current state and can show certain limitations or opportunities for when you customise the space. You may well find that the building needs electrical upgrades to support your workforce, or that certain areas will require a new ceiling. This information gives you more time to plan, allowing you to make informed decisions about the new office space.
Ensure safety compliance
Safety should be the priority for every business, and a condition report can help make sure that your (potential) new property meets essential safety standards before your tenancy begins. During an inspection, potential hazards, like faulty wiring, structural weaknesses, or insufficient fire safety features, may be uncovered. Addressing these issues early not only protects your team and other people that may use the space, but also reduces liability risks that could arise from safety non-compliance.
At Niche Tenant Advisory, we’re here to help
At Niche Tenant Advisory, we specialise in supporting tenants through the leasing process, from initial inspections to negotiations and beyond. It’s clear that a condition report provides enormous value, delivering essential information before you sign your lease. We provide high-quality condition reports for new commercial tenancies in Sydney.
