Virtual Current Property Issues – Autumn 2023

KEY SUBJECTS

• COMMERCIAL LANDLORD AND TENANT CASE LAW UPDATE
• THE IMPLEMENTATION OF THE RICS VALUATION REVIEW
• MEES IN THE REAL WORLD – THE WORKED EXAMPLES
• CURRENT BEST PRACTICE IN LEASES
• UK ECONOMY – A SOFT OR HARD LANDING IN 2023/24?
• REPURPOSING OUR TOWN CENTRES

SPEAKERS

Lesley Webber, Consultant, Fieldfisher

Nick French, Real Estate Valuation Theurgy, Property Education

Ben Strange, Senior Director, Mobius Building Consultancy Ltd

Rufus Ballaster, Senior Partner, Carter Lemon Camerons LLP

Walter Boettcher, Head of Research and Economics, Colliers

Ian Anderson, Senior Director, Lichfields

CONFERENCE PROGRAMME

09.30am CHAIRMAN’S INTRODUCTION

COMMERCIAL LANDLORD AND TENANT CASE LAW UPDATE

• Landlord and Tenant Act 1954: Second chance – If a landlord misses the deadline for opposing a new tenancy, can it insist on a redevelopment break clause instead? B & M Retail v HSBC Bank Pension Trust (UK) Ltd, Central London CC, 3 March 2023
• Authorised Guarantee Agreements: Privity of contract – Does a restructure of the tenant relieve its guarantor of liability under an AGA? Oceanfill Ltd v Nuffield Health Well-being Ltd 2002 EWHC 2178
• Commission agreements and implied terms: Mind the gap – Did a commission agreement that specified a figure for an introduced sale allow for commission if the price fell short of that figure? Barton v Morris [2023] UKSC 3
• Rent review and implied terms: Where a lease provides for the rent on review to be calculated by reference to the rent payable under an underlease of the property, what happens if the underlease is surrendered? Rail for London v Hackney [2022] EWHC 2929
• Party structures – Party Wall etc Act – What can an adjoining owner do if their neighbours fail to serve the required notice under the Act for their building works? Power v Shah [2023] EWCA Civ 239
• Heads of terms and subject to contract : Inadvertent consequences – What makes heads of terms for a lease binding in their own right? Pretoria Energy Company (Chittering) Ltd v Blankney Estates Ltd [2003] EWCA Civ 482
• Mixed use property – development: Where a landlord grants a lease of a commercial unit with a long lease of the residential flat above, and reserves the landlord’s right to develop provided this does not diminish the value of the flat, what rights does the flat owner have? Dunward Properties Ltd v Isaacs [2022] EWHC 3276
• Nuisance, Japanese Knotweed, and compensation : Can diminution in value from the blight or stigma of Japanese Knotweed form part of a nuisance claim against another owner? Davies v Bridgend County Borough Council 2023 EWCA Civ 80
• Proceeds of Crime Act 2002: Why commercial landlords should be worried about planning breaches on the part of their tenants: – Re: T & M Property Investment Limited, Manchester Crown Court, 5 May 2023

This list may be subject to amendment, addition, or substitutions as more decisions become available.

Lesley Webber, Consultant, Fieldfisher

THE IMPLEMENTATION OF THE RICS VALUATION REVIEW

Over the last few years the Royal Institution of Chartered Surveyors has embarked upon a number of initiatives to protect and enhance the standing of the RICS Valuation Surveyor. The principal of these was the “RICS Independent Review of Real Estate Investment Valuations” published in January 2022. That report made 13 recommendations and, after careful consideration and consultation with the membership, the bulk of the changes will be implemented at the start of 2024. This talk will outline the impact of these changes and how they will support the valuation surveyor in their day-to-day work.

• The importance of regulation, consistency and professionalism in Valuation
• The importance of using the appropriate valuation model for the subject property
• The importance of independence of the valuer
• The importance of providing the valuation report in an appropriate format
• The importance of “marking to market” – Market Value
• The importance of distinguishing Market Value from Worth

Nick French, Real Estate Valuation Theurgy, Property Education

MEES IN THE REAL WORLD – THE WORKED EXAMPLES

The MEES Regulations are now actively impacting the commercial property market.  Whilst many focus on the popular ‘ESG’ trend, the real impact for most stakeholders is being felt through the legislative impact of MEES and the regulations’ sharply tightening requirements.  This talk will look at a number of applied examples across different property types/sectors to identify the impact – and the actions/tactics to be employed by respective parties in scenarios such as:

• Lease negotiations – how tenants can use MEES to drive a harder bargain, and how landlords can rebut such an approach
• Property management – how landlords’ property management approaches can leave them facing issues and disputes
• Alienation – the blame game afoot when a tenant can no longer sublet their property due to MEES
• Reasonable refusal – what can a landlord reasonably refuse when it comes to MEES?
• Lease wording – will the engineered MEES carve-outs work in practice for Landlords?
• Dilapidations – is the result of MEES really a sea of £0 dilapidations settlements?

Ben Strange, Senior Director, Mobius Building Consultancy Ltd

CURRENT BEST PRACTICE IN LEASES

Through the following hot topics, the state of lease drafting and leasehold property management will be explored by this speaker who is still at the ‘coalface’ of landlord and tenant interaction:

• Break clauses
  • Shorter leases have not ended use of break clauses
  • Now very much the tenant’s tool
  • Few leases now adopt ‘disingenuous’ drafting
  • A privilege not a right – getting exercise right
• Tenancies at will
  • Not 1954 Act protected
  • Can/should give exclusive possession
  • Must not, however, have certain ‘standard’ clauses
  • Maybe can now have some certainty of ‘notice’
• Leases by reference
  • Short lease terms make this more attractive for renewals
  • Subleases can usefully adopt the whole of the headlease and ‘tweak’
  • Intellectual challenges of getting the tweaks right
  • Should we be doing it more often?
• Reasonable time for consent – alienation etc
  • Is the law affected by the Alienation Protocol
  • Has the Protocol helped
  • What are the remedies, faced by lack of consent
• 1954 Act – not dead yet
  • Contracting out – still a minefield
  • Accidental protection
  • Accidental loss of protection
  • Fun facts under this nearly 70 year old Act

Rufus Ballaster, Senior Partner, Carter Lemon Camerons LLP

UK ECONOMY – A SOFT OR HARD LANDING IN 2023/24?

November is almost upon us, and the landing zone is almost in sight. The Bank of England may have finished raising rate, but have they gone too far already?  The rates are already high enough to pose financial stability risks and only 50% of the intended impact has been felt. Up to a million households are coming off fixed-rate mortgages in the next few quarters posing new risks. Inflation is falling but is it the ‘right kind of inflation’? Will it be enough to halt further rate rises?  Ongoing business and investor uncertainty is lingering in H2 2023. Will this deprive the UK commercial property sector of its traditional year-end surge? Despite these short-term worries, several long-term trends (demographic changes, new working practices, retail transformation, et al) offer opportunities for the UK economy and especially for UK regional development and commercial property.

• Short-term outlook on UK inflation, interest rates, financial stability, and economic performance
• Latest market metrics and forecasts for UK commercial occupier and investment markets
• Observations on AI, e-commerce, hybrid working and ESG
• Long-term outlook on UK structural change and performance against its international peers
• Is ‘levelling up’ dead? A few notes on UK regional development and regeneration

Walter Boettcher, Head of Research and Economics, Colliers

REPURPOSING OUR TOWN CENTRES

In the last 5 years town centres have endured the perfect storm: the challenges of e-commence, the stop/start of Covid and now the cost-of-living crisis. The rise of the footloose shopper, with little brand loyalty and an omnichannel approach to shopping habits require developers and policy makers to reappraise the role of town centres. No longer simply providing retail as their raison d’etre for survival, town centres need to repurpose.

What does the future of the town centre look like … does it have a future?

This session will look at:

• The challenges facing the high street
• Existing policy reform introduced through Permitted Development and the NPPF to prioritise repurposing
• The success of initiatives so far
• Future potential strategies
• Case studies showing successful repurposing
• How this is likely to impact the development industry

Ian Anderson, Senior Director, Lichfields

5.00pm CLOSE OF PROCEEDINGS