The Business Occupier’s Handbook

Citation

Crane, M. (1998), "The Business Occupier’s Handbook", Property Management, Vol. 16 No. 2, pp. 103-104. https://doi.org/10.1108/pm.1998.16.2.103.2

The Business Occupier’s Handbook has primarily been written to provide a comprehensive source of information for business occupiers. However, it will also prove to be a useful reference book for students and general practitioners alike. The author has previous experience in managing investment properties for landlords, and has written the book to provide a basic understanding of property matters, including landlord and tenant act legislation, but excluding facilities management.

The book is divided into five chapters, with a summary of the points at the beginning of each one. The brief summaries are very helpful, particularly as each chapter contains a wealth of information. Indeed, in dealing with such a complex subject, I wonder whether so few chapters are sufficient. The details of accounting practice in Chapter 1, for example, would merit a separate chapter by itself, and may also make it easier for those who find such a topic somewhat daunting. The chapter headed “Transaction Structure and Terms” follows the chapter on “Acquisition”, and equally for some this may be the wrong way round. The section on “Town and Country Planning” is also initially difficult to find, being located within a chapter on managing costs and occupation. However, primarily this book is a reference book as opposed to one to be read cover to cover. The numerous cartoons often serve to highlight the points made, and also liven up the text considerably.

Inevitably there are comments made by the author that the reader would like to challenge. Initial comments on leasing (p. 7) for example, do not really focus on the problems of upwards‐only rent reviews, which can leave a business with outgoings considerably in excess of any increase it may otherwise have expected in revenue. However, there is equally very good advice, particularly on negotiations ‐ “Going to a landlord armed with a discounted cashflow calculation showing why they should accept a particular surrender premium can often be more successful than asking them to start the bidding.” The instruction of agents, their respect fee bases and the contents of their valuation reports, is again comprehensively covered and provides succinct information for anyone entering this arena for the first time. Conflicting valuation terms are explained well, although perhaps more comment could have been made regarding the use of valuation tables. While reference is made to the use of Parry’s tables, there is no reference to others, such as Roses tables or others, and no comment on the differing methods of calculation each set of tables adopts. While the writer also refers to the “Red Book” (p. 57) in the absence of any further comment, I wonder how many readers would know what this was. The only other clue is given in the reference to the publishers under “Further Reading” at the end of the chapter, yet in practice this RICS Manual is of fundamental importance to valuation techniques.

Accounting practice, tax and VAT is again well covered, as are landlord and tenant matters. However, the commentary on licences (p. 135) may prove to be slightly misleading and does not give any warning to the reader regarding the possibility that property owners may inadvertently grant tenancy rights by initially entering into licences for too long a duration, or which are not properly determined. Options to determine, the recent change in privity of contract legislation, landlords’ covenants and rent‐free periods are all covered comprehensively, although personally I would not rely on CAD technology to agree net internal usable areas for the purposes of a rent review, as suggested by the writer. Some further emphasis on the “disregards” to be borne in mind when dealing with rent reviews (p. 170) would also have been helpful. The definitions given here would also have been even more useful if incorporated within a glossary of terms at the end of the book.

A substantial amount of information is crammed into the chapter on “Managing Costs and Occupations”, particularly as this includes planning and environmental issues, which may have benefited from being dealt with separately. The reference to enforcing covenants here (p. 223) is partly a repetition of the details provided earlier under the heading of “Rent” and again, it may have been worthwhile putting all this information under the same heading.

The final chapter, on “Exit and Lease Renewal”, again provides good advice on the instruction of agents, and approaches to the landlord for permission to assign, although perhaps more advice could have been given as to whether a landlord’s response was unreasonable. The service of notices is covered in some detail, as are schedules of dilapidations and reinstatement. The appendices covering the RICS Code of Measuring Practice and main definitions, the summary checklist and addresses, are again very helpful. While the book also clearly explains nearly all the technical terms used, and has a comprehensive index, a glossary of definitions incorporated within the appendices would also have been of considerable assistance.

There is always a risk in writing books such as this that some business occupiers may consider that they can rely on the contents therein, as opposed to seeking professional advice where necessary. However, the writer recognises this and recommends that the advice of experienced professionals is sought, where relevant (p. 14). For many, the contents of the book will at least provide a broad background to the subject and enable the business occupier to know what questions to ask. Indeed, the availability of such background knowledge may, in turn, influence the desire to obtain further advice. Doubtless, changing legislation and case law will render parts of the book out of date very quickly ‐ information contained therein is on the basis of the law as it was at August 1996, and party wall legislation has already been enacted since the book’s preparation ‐ but overall The Business Occupier’s Handbook provides a handy and useful point of reference for anyone seeking general advice on property matters.