The tenants of individual units are either under an obligation to carry out necessary repairs to their part of the building themselves; or else the landlords do all the repairs needed in a building and recover the cost by way of service charge from all the tenants.
A tenant can realistically take on the repair of an entire building if it’s the tenant of the whole building. But in a multi-occupation building, like an office in an office block, or a shop in a building with flats above, the business owner can’t realistically handle repairs which may not relate only to his premises but probably also involve other units, or the common parts, or the structure of the building. So for multi-occupation buildings, the only sensible arrangement is for the landlord to carry out all major repairs, and the individual tenants to be responsible only for purely internal repairs within their own units.
The almost universal arrangement with business premises is that the landlords are responsible for keeping the building in repair and are reimbursed by tenants for the cost of building repairs.
If you are only taking a shop or an office unit and the landlords undertake all repairs to the structure and exterior, you will still have a liability to keep the interior of your premises in repair.
At the end of the lease, the landlords may be entitled to require you to hand back the premises in a good condition – a better condition possibly than when you took them in the first place. It depends on the precise wording in the lease.
The landlords will carry out an inspection of the premises at the end of the term and do a list of any items of disrepair. Then they will require you to either do the works yourself, if there is enough time before the end of the term, or to pay the cost of the landlords having the works done. That can be very costly.
A repairing covenant in a lease often requires the tenant to keep the premises in “good and substantial repair”. You need to discuss the draft lease with your solicitors to understand what level of repair is being proposed in your case. If the premises are not in good repair and condition now, there is a risk that the repairing covenant will require you to return the premises at the end of the term of the lease in a much better state.
To avoid that risk, you should seek to agree with the landlords that you will not be required to hand the premises back in any better state of repair than they are in at the start of the lease. (You would prove this by having a “schedule of condition” prepared before you sign the lease detailing the exact condition the premises, backed up with photographs.)
You must arrange for the landlords to approve the schedule of condition in writing at the same time the lease is signed. If it is not an agreed document, it won’t carry any weight when you need it at the end of the lease.
You should agree in advance who’s going to pay for it. It would be reasonable for the cost to be split equally between landlord and the tenant. But the landlords may regard it as something being done for your benefit.
If you take an assignment of the lease from someone else, so that they have been trading in the premises for several years before you, remember that the lease may require you – the current tenant – to restore the premises at the end of the lease to the condition they were in at the start – in other words, when the original tenant moved in, not when you did. So, before taking an assignment of the lease, you need to make sure you know what alterations the previous tenants carried out, and consider what problem that will be for you at the end of the lease.