We provide advice on all aspects of professional work namely Rent Reviews and Lease renewals
- Rent reviews
- Lease Renewals
Acting for landlords or tenants, investors or occupiers:
- Negotiating Rent Reviews
- Negotiating Lease Renewals (inside or outside the L&T Act 1954)
- Lease Due Diligence on the acquisition and disposal of leasehold interests
- Lease Restructuring (Re-gears, Surrenders and Re-grants, Covenant Reappraisal and Renegotiation)
- Advice on Form of Lease in sale and leaseback transactions
- Rental Valuations
- Acting as Expert Witness in rental valuation disputes
Pharmacy Shop Rent reviews
We have to thank an opportunistic Valuer from Australia who came to the UK some years ago for bringing a new approach to valuation techniques for landlords of Pharmacy shops causing many tenants to have to pay sometimes 5 times the market shop rent, on rent review.
His idea, as in Australia there is little evidence sometimes available of shops to compare with nearby, was to base the reviewed rent on the number of patients per pharmacy, rather than traditional methods based on what other shops were paying.
This caught on like wildfire with landlords in the UK and has become now a standard method of pharmacy rental valuation by surveyors and accepted by Arbitrators and Independent Experts.
So what do you do, as a Pharmacy faced with a major rental increase?
- Being on a “High Street” is more or less a complete defence, dependent on certain factors.
- Being adjacent or close to a Surgery/Medical Centre, or in one makes a defence against a patient’s list valuation basis more difficult.
- In order for a tenant too convince the Arbitrator/Expert that they should not depart from the normal practice of valuing as a normal retail shop, the tenant’s surveyor must present clear evidence that a Patients List Valuation approach is the incorrect one to follow.
It is not sufficient for a landlord’ surveyor to show evidence of £’s per patient approach being adopted elsewhere, unless the circumstances of those cases are sufficiently ‘on all fours’.
Even if a patients list valuation basis cannot be defended against in certain circumstances, then due to prescription volume and value, a lesser rental should be argued for, where prescriptions are below average.
What has happened to date is an arbitrary rate per patient has been applied by Experts and Arbitrators, irrespective of where, or how successful the pharmacy is and not adequately fought against by the tenant in the first place.
We negotiate and advise on all aspects of a lease including drafting, review, renewal restructuring, dilapidations and resolving disputes.
We understand and interpret existing leases to produce the best practical and commercial outcome for our clients.