Leasing & Letting Flashcards
(36 cards)
What are the type of different agency basis?
Sole agency - Joint agency - multiple agency
What is the difference between a lease, assignment, sublease, and license?
Lease - exclusive possession between landlord and tenant for a fixed term.
Assignment - transfer of the current tenants’ interest to a new tenant. AGA.
Sublease - Between existing tenant and subtenant.
License - LL grants tenant permission to use property/land for a specific purpose - right to occupy
How would economic trends impact lease terms and value?
When economy is poorly performing, tenants are less willing to take risks.
Demand can fall, meaning rental growth may be stunted.
Less willing to take longer leases - increased demand for break options.
What is the RICS Professional Statement: Code of Leasing Business Premises, 2020?
Mandatory standard regarding the leasing of commercial property in the UK.
Aims to promote fairness, transparency, and professionalism in lease negotiations.
Collaborative and constructive negotiation approach.
Unrepresented parties must be made aware of the code and advised to obtain professional advice.
HOTs must be agreed and documented prior to issuing lease.
What are the Consumer Protection Regulations?
UK regulations aimed at protecting consumers from unfair or misleading business practices.
Prohibits misleading information and actions - all about informed decisions.
Ensure details in marketing brochures are true to the best of your knowledge.
What was information did you include in the brochure of the industrial unit in Melton?
225,000 sqft
18m eaves
5 level access doors
5 dock level doors
1250 KVA power
20% office content
EPC C
Location
When it was available
What was the specification of the industrial unit in Southampton?
Newly refurbished - EPC B
115,000 sqft
1989 build
40% site cover
Steel portal frame - metal clad elevations and roof.
PV array - 50kwh
8m clear eaves.
What did you include in the marketing report for the industrial unit in Southampton?
Description of the property and location.
Measurement
Market commentary - quoting rents of new builds in area at £15 per sqft for midbox
Macro economic market commentary
Availability in the area
Pipeline availability
Competition
Recent deals done
Recommendations
View on market rent, expected incentives and void period.
Fees - 10% sole agency, 15% joint agency.
What deal was agreed for the letting at Southampton?
20 year lease - no break options
5 yearly rent review - OMV
£11.50 per sqft
5A2 covenant
24 months RF - RF 1st year, half rent for following two years.
What were your client’s objectives for the letting at Rotherham?
Minimum void period
Acknowledged the unit was at a disadvantaged due to the layout, location and condition.
Willing to agree a short-term letting whilst they decided their long term objectives with the assets.
Agreeing a rent at the same or higher than previous tenant, who went into administration.
What are the standard size boards?
V board - 2.3 sq m
Single flat board - 2 sq m
What is included within a TofE for agency?
Agency basis
Marketing budget
Scope of works
Name of client
Name of agent
Date
Address
Fee basis
How would your advice differ for a different length term?
For a short term may have a higher premium.
Less rent free.
Smaller deposit.
Advise that a longer term is more suitable.
How might an agent misrepresent in a transaction?
By providing inaccurate or misleading information
Failing to disclose important information.
Making false statements to get a tenant to enter into a tenancy agreement.
What factors can affect rental value?
Use
Inside or outside L+T act
Age
Location
Specification
Terms
Incentive
What is the new professional standard related to agency?
The RICS Professional Standard: Property agency and management principles, 2024 (effective Jan 2025)
This professional standard is related to the different agency and management disciplines in the property sector.
The 2 main areas covered in the publication are working with clients and managing businesses and staff.
What documents have been consolidated into the new Property Agency & Management Principles?
Global property agency and management prof standard
UK property agency prof standard
UK prop man prof process.
What legislation is there relating to agency?
Estate Agents Act 1979
Misrepresentation Act 1967
What is the Estate Agency Act 1979?
Legislation that aims to protect consumers and ensure that estate agency work is carried out honestly, transparently, and competently.
Must declare conflicts, fees & charges, manage client money, not mislead.
What is the difference between sole selling and sole agency rights?
Sole agent only entitled to a fee if they find or introduce an occupier.
Sole seller entitled to a fee even if client finds occupier themself.
What is S21 of the Estate Agency Act 1979?
Relates to declaring conflicts of interest
What is S18 of the Estate Agency Act 1979?
Duty to provide information - clear details on fees, commissions etc.
What should be included in a set of HOTs?
Premise
Use
Term length
Parties involved
Options - break or renewal
Rent review
Inside the Act?
Incentives
SC & insurance
Rights to assign, sublet, charge etc.
Repairing obligations
Alterations
Conditions
What are the principles of Estate Agency Act 1979?
S18 TofE - inc fees & nature of agency
Honesty & accuracy
Agreement and liability for costs
S21 CofI
No discrimination
Inform client about offers
Client money held separately
