RAAC implications for commercial property leases
Just a few months ago, very few people would have heard of Reinforced Autoclaved Aerated Concrete, or RAAC as it is now commonly known. However, the closing of hundreds of schools which were deemed to be at risk of collapse due to the presence of RAAC, has now brought this type of build to the forefront of many commercial property owners’ minds.
We now know that more than 150 schools, nurseries and colleges across England have been forced to close parts of their buildings which could be at risk of collapse. Tens of health care facilities are seeing an urgent review, with a number having to be completely rebuilt.
For those who do not know, RAAC is similar to traditional concrete but is filled with air bubbles. This of course makes it cheaper but also lighter and easier to use in building work. It was widely used in post-war Britain to get the country up and running quickly and cost-effectively.
Although the recent news has been focused on public buildings, it is likely that RAAC has also been used in many commercial properties such as offices, shops and warehouses, making the problem much more widespread than was initially thought.
This could most certainly mean significant implications for both the owners and tenants of older commercial properties. Those more likely to be built using RAAC would have been constructed between the 1950s and 1990s – which is quite a significant 40-year window.
Commercial property owners and tenants need to investigate whether RAAC is present in their buildings. They should also, examine their leases to be clear who will be responsible for any necessary works.
If RAAC is found to be present, then professional advice, such as that from a building surveyor and/or structural engineer, will be needed to understand how best to resolve the issue.
As far as commercial property leases are concerned, the most important point is to determine who is responsible for the repair and maintenance of the structure and fabric of the building. This will therefore show who will be needed to cover the cost of the work required to remedy the situation. Generally speaking, landlords will normally be responsible for the maintenance and repair of the structure and exterior of multi-let buildings, while tenants are usually responsible for buildings which are leased on a standalone basis.
Going forward, it is possible that, as is now the case with asbestos management, legislation could be brought in to manage buildings containing RAAC. That would then pass responsibility onto tenants who are under an obligation in their leases to comply with any statutory requirements that arise in relation to their leased premises.
It is still relatively early days of course, and we are still yet to see how big an issue RAAC is across general commercial properties.
At GA Solicitors we have significant expertise in acting for both commercial landlords and commercial tenants. We can advise any concerned owners or occupiers of buildings impacted by the above on their respective commercial lease obligations and the necessary next steps to take.
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