Dilapidations remain one of the most important issues affecting landlords and tenants at lease expiry. In a changing occupational market, expectations around premises condition, flexibility and cost have shifted, making early preparation more important than ever.

Whether acting for landlord or tenant, successful outcomes are usually driven by timing, evidence and commercial realism.

What are dilapidations?

Dilapidations generally relate to breaches of lease covenants concerning repair, decoration, reinstatement and statutory compliance. Claims commonly arise towards the end of a lease term, although interim issues can also occur.

Why the market matters

Occupier demand, refurbishment trends and local supply conditions can materially influence strategy.

For example:

Strong demand markets may encourage landlords to seek quick re letting with limited downtime.

Weaker markets may require more significant repositioning works, changing how claims are approached.

Older stock may need wider upgrades beyond lease obligations, requiring careful separation of landlord improvements from tenant liabilities.

Why early action is essential

For tenants, leaving dilapidations until the final weeks of occupation often limits options and weakens negotiating position.

Early review can allow time to:

• Understand likely liabilities
• Undertake cost effective works
• Obtain contractor pricing
• Gather evidence of supersession or landlord intentions
• Budget accurately

For landlords, early planning supports asset strategy, programme coordination and realistic claim preparation.

Evidence remains critical

Schedules should be clear, measured and properly supported. Overstated claims can damage credibility, while poorly evidenced claims may under recover legitimate losses.

A pragmatic approach

The most successful outcomes often arise where both parties focus on realistic liability, robust evidence and commercial settlement rather than unnecessary escalation.

Compass Building Consultancy advises landlords and tenants through the dilapidations process, combining technical analysis with practical negotiation support.