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EQ Repairs

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  • EQ Repairs

    Hi, we are in the process of EQ strengthening our hotel, can these costs be applied to the tenant?

  • #2
    No - these are structural costs so cannot be passed to the tenant.

    If the strengthening will take considerable time, you may have to consider compensating the tenant for loss of business. Best is to involve the tenant in the process and keep them updated.


    • #3
      this assumes you have a ADLS standard lease? and that their standard terms apply?


      • #4
        I think with these costs, it's like "sucking a big kumara" as we used to say in Manurewa.

        In that, you have to pay for the strengthening costs, but you don't really get any more rent. So your building is worth only slightly more.

        The reason to do it is a) You have to in some areas if the building is quite weak and b) Tenants won't lease your building unless you do.

        So you get to rent your place, but not necessarily for more rent than you were getting before... is this right?
        Squadly dinky do!


        • #5
          in respect to the first it depends on the area.

          In respect to the second tenants are imposing unnecessary cost on LL such as as requiring 67%NBS when the law is only requiring 34%minimum as if this makes them safer? Insurers are also interferring when the freality of Chhch was that even 100%NBS damaged buildings needed to be demolished as the damage was still uneconomic to repair.


          • #6
            Hi Davo36,yip sounds like we have to suck the kumara......we have the next 7-8 years for it to happen, so hopefully they might change the rules before then?


            • #7
              Yip, standard ADLS lease, they are looking for compensation for closing down part of the hotel, just working through that at present.


              • #8
                why dont you defer the work until the lease expires or negotiate to your advantage. What region are you in?


                • #9
                  We are in the Canterbury area,lease doesn't expire until 2032, what can you negotiate to your advantage?