Hi All,
Read a similar thread on this on the residential property side but this one is a little different:
After 9 months, we finally found a tenant for our aging warehouse (built circa 1960s). Anyway, the lease got signed but didn't stipulate anything about eletricity and utilities, however, I must stress, it was rented out in an "as is" condition. We kept the rent a bit below market rate (around $8K below) but in return, we did get an established business which appears stable and also he has "prettied the place up" – added partitions, new coats of paint on interior/exterior and added new lighting.
Now here is the problem, as the building was built 50 years or so back, it complied with the "then (if any) eletrical codes". However, when he installed or was planning to install new lights, the electrician (his friend) reckons the wiring is 1) non complaint 2) dangerous and will not do any new installations because of this. Basically, it needs a rewiring, however, this is the important bit:
* He is demanding that I get an electrician of my choice and issue a certificate that all electrical works is complaint and safe (is this required by law?)
* Note, my stance is that because he wanted to install new lights (by his own choice, not mine) this safety concern is his, not mine. The original lighting (not fit for his business/purpose) didn't have a ground wire which was the standard back then. It works, safety is questionable until I get an electrician (most likely not OK).My question ultimately is this -> because I didn't have a clause or whatever in the contract, what is the letter of the law's stance on this? At the commencement of the lease I supplied lighting in a workable condition, safety bit I don't know….but because he chose to change the structure of the lighting, shouldn't this be his responsibility???
My PM reckons I should get an electrician in and re-wire the parts that need to be, but I'm still confused as to why shouldnt' the tenant take onus?
All in all, I have to weigh up factors, this will ultimately void my insurance if anything goes bad…but then again, it is a lot of money to re-wire even bits of the building!
Thanks.
G'day Willister.
I would suggest, firstly, that you do have an electrician give the wiring and wall plugs the usual tests to make sure the premises do meet the minimum standards so you know you are protected with regards to your building and public liability insurance. Now, if the premises are indeed ok, and your tenant wishes to introduce operating equipment that requires a change in the pre-existing electrical wiring/system then, with the limited info you have supplied above, the electrician and costs are on the Tenants bill, not yours. However, there are many other factors to consider such as how reliable and good a tenant you have; how much longer does his lease have to go; is there the option to extend; and so on. You have both made concessions: you in reduced rent, he in improvements. Ultimately, if the tenant is a good one, you should (as a suggestion) factor in ther costs to do the re-wiring against how much longer he will stay in the premises continuing to be a good tenant and see if it is worth the expense (which will also be tax deductible for you!).
I hope this has been of help to you willister.
Kind regards,It's great to have an expert on the forum.
Kind of you to help Anthony, what goes around . . . .
Cheers
thecrestthecrest | Tony Neale - Statewide Motel Brokers
http://www.statewidemotelbrokers.com.au
Email Me | Phone Meselling motels in NSW
I’d get my own sparky to check the board & wiring. If the new tenant requires additional lights etc (on new circuits & subboard so it does not affect the existing installation & can be removed at termination of the lease). Then the tenant cannot argue that they have relied on an unsafe or non-compliant installation.
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