In addition to ensuring the maintenance and upkeep of the structure and fabric of your building/investment it is important to understand the correlation between value and length of lease. Building societies and banks invariably will not lend once the lease has less then 70 years remaining. This therefore would cause a delay if any properties to be sold to a third party who requires any form of funding.
The 1996 commonhold and leasehold reform act enshrined a right to extend the term of the lease by an additional 99 years subject to certain criteria and a strict timetable. Prior to any negotiations for a lease extension we would recommend an independent valuation by a qualified surveyor/valuer.
In franchisement is the joint purchase of a freehold by a group of leaseholders collectively serving notices and obtaining professional valuations and advice en route to Acquisition. Once again a detailed valuation and professional advice should be sought by a qualified surveyor/valuer.
Leaseholders collectively also have the ability to exercise a right to manage their premises in the event of a Phalia by a freeholder or managing agent. The right to manage however is not necessarily the panacea To management as along with the right to manage comes the obligations of the freeholder to maintain and insure regardless whether all leaseholders are contributed. We have seen several incidences where leaseholders have jointly exercise their right to manage only to discover the problem lies with a leaseholder not paying the service charge which continues once the take over has been completed. Leaseholders exercising their right to manage affectively “ step into the freeholders shoes” taking the responsibility and liability to maintain and upkeep the fabric and structure of the building and failing to do this can result with directors becoming personally liable for failure to maintain and potential damages/legal costs.
Ross and co-property management or our sister company Ross and co-agency Ltd can provide advice in this regard as well as professional valuations and negotiation services.