In 2016 our North East team were instructed by the University of Newcastle to advise on their dilapidations liability for the former Fenham Barracks on Leazes Parade.
Our building consultancy team inspected the property, a block of modern purpose built student dwellings, together with the conversion of the historic, Grade II listed, Officer’s & Sergeant’s Messes of the former Fenham Barracks.
Partner in our building consultancy team, Martin Smith entered into discussions with the landlords surveyor and advised the university that there may be the opportunity to defend the claim via the provisions of s18 (1) of the Landlord and Tenant Act 1927. This essentially places a cap on the claim of no greater than the diminution in the Market Value of the asset due to the alleged dilapidations.
In 2019, the University vacated the premises and the lease formally came to an end in September and the Landlord served a Terminal Schedule of Dilapidations, claiming total damages (including fees) at a seven figure sum.
Following further unsuccessful discussions, due to an unwillingness to compromise from the landlord’s surveyor, our valuation team were instructed to prepare a formal s18 (1) valuation, to determine the cap on the landlords claim for damages.
Working alongside the building consultancy team it was established that the reduction in value of the property was significantly lower than the figure originally quoted. In response we submitted a Part 36 offer on behalf of the university, which was accepted by the landlord and resulted in a saving of over 50% of the initial claim.
David Downing, head of our Newcastle valuation team added, “Having both building surveying and specialist s18(1) valuation skills under one roof meant that we can provide a joined up, coherent and cost effective approach to dilapidations for both Landlord’s and Tenant’s. It’s something that not all practices can do and in this example helped us achieve a significant saving that’s especially timely when university budgets are under such tremendous strain.