A practical guide for commercial landlords managing lease expiries and dilapidations assessments.
When a commercial lease approaches its end, the question of dilapidations rarely comes as a surprise — but the scale of the liability often does. Landlords who haven't tracked the condition of their property throughout the lease term can find themselves facing protracted disputes, significant legal costs, and a building that needs substantial work before it can be re-let. Getting ahead of the process is not just good practice; in most cases it's the difference between recovering your costs and absorbing them.
This guide is written for commercial landlords and property managers who are either approaching a lease expiry or want to understand the dilapidations process well enough to protect their position. It covers your legal obligations, what a dilapidations schedule actually involves, common disputes, and the practical steps that reduce cost and delay.
Building dilapidations are breaches of the repairing, decorating, and reinstatement obligations set out in a lease. At the end of a commercial lease, the landlord is entitled to require the tenant to remedy those breaches — or to claim damages equivalent to the cost of doing so. The term covers a wide range of issues: structural disrepair, failure to maintain mechanical and electrical systems, unauthorised alterations left unreinstated, and cosmetic deterioration beyond fair wear and tear.
The key document is the lease itself. The repairing covenant will specify whether the tenant is responsible for internal repairs only, or for the full structure and envelope of the building. A full repairing and insuring (FRI) lease — the most common structure in commercial property — places the entire maintenance burden on the tenant. Understanding what your lease actually says is the starting point for any dilapidations assessment.
The dilapidations process is governed primarily by the Landlord and Tenant Act 1927, the Leasehold Property (Repairs) Act 1938, and the Dilapidations Protocol published by the Property Litigation Association (PLA). Courts expect both parties to follow the PLA Protocol before litigation. Failure to do so can result in cost penalties even if you win your claim.
The Leasehold Property (Repairs) Act 1938 is a significant constraint for landlords. Where a lease has at least three years remaining from the date of a Section 146 notice, the tenant can serve a counter-notice requiring leave of the court before the landlord can proceed. This makes it harder to enforce during a lease than at its end — which is one reason the terminal schedule of dilapidations (served at or after lease expiry) is the most common mechanism.
Damages are capped by Section 18(1) of the Landlord and Tenant Act 1927. The court will not award more than the diminution in the value of the landlord's reversionary interest caused by the disrepair. If you intend to redevelop or substantially alter the property after the lease ends, this cap can significantly reduce what you can recover — even if the schedule of works is extensive.
Landlords can serve dilapidations notices during a lease (interim dilapidations) or at its end (terminal dilapidations). Each has different strategic implications.
For most commercial landlords, the practical focus is the terminal schedule. The quality of that document — and the supporting cost evidence — determines how well you negotiate.
A schedule of dilapidations is prepared by a building surveyor and sets out each breach of the repairing covenant, the works required to remedy it, and an estimated cost. It is not a wish list — it must be grounded in what the lease actually requires and supported by credible cost data. Schedules that are inflated or poorly evidenced are quickly challenged by tenants' surveyors and can undermine the landlord's overall negotiating position.
A well-prepared schedule for end of lease maintenance on a commercial property should cover:
If you carried out a schedule of condition at the start of the lease, this becomes the baseline. The tenant is only required to return the property to the condition documented at that time — not to a higher standard. Landlords who didn't commission a schedule of condition at grant are often in a stronger position than they expect, but equally can face challenges from tenants arguing that pre-existing defects are not their liability.
Dilapidations disputes are common, but most follow predictable patterns. Understanding where disagreements arise allows landlords to build a stronger position from the outset.
The strongest dilapidations positions are built before the lease ends, not after. Landlords who treat dilapidations as an end-of-lease problem rather than an ongoing asset management concern consistently recover less than those who plan ahead.
Commercial landlords who also manage mixed portfolios — including properties let to housing associations or where insurance repairs are involved — need to be clear about which costs fall under dilapidations and which fall under other recovery routes. Dilapidations claims are solely about lease obligations. Damage caused by an insured event, for example, is a matter for the property's buildings insurance, not the dilapidations schedule — even if the physical repair work overlaps.
Similarly, housing association maintenance contracts often include specific repairing standards and schedules of condition that differ from typical commercial arrangements. If you manage commercial space within a mixed-use development that includes social housing, the obligations and recovery mechanisms need to be treated separately and clearly documented. Conflating them creates liability exposure in both directions.
Gebai Property Services provides end of lease maintenance and dilapidations remediation for commercial landlords across Yorkshire and the wider North of England. We work alongside building surveyors and solicitors to deliver the physical works identified in a schedule of dilapidations — on time, within agreed costs, and documented to the standard required for a clean handover or negotiated settlement.
Where a landlord needs to carry out remediation works to bring a property back to a lettable standard, we manage the full scope: structural and fabric repairs, M&E servicing and replacement, internal redecoration, reinstatement of alterations, and compliance works. Our experience across commercial property maintenance means we understand the evidential requirements of the dilapidations process and can provide properly itemised cost breakdowns that support your surveyor's schedule.
We also work with landlords earlier in the process — carrying out condition inspections and preparing photographic schedules that strengthen your position before lease expiry. For commercial property dilapidations in Yorkshire, whether you're dealing with a straightforward office unit or a complex industrial site, Gebai provides the practical maintenance capability that turns a surveyor's schedule into a completed, documented property.
If you're approaching a lease expiry or managing an active dilapidations claim, contact Gebai to discuss how we can support the remediation and documentation process.
Whether you're preparing for lease expiry or need to carry out remediation works against an agreed schedule, Gebai can manage the full scope of dilapidations repairs for commercial properties across Yorkshire. Get in touch to discuss your requirements.
We are always open to discussing new contracts, framework agreements and long-term partnerships with housing associations, developers and property managers.