Commercial building owners are likely to find that, to attract tenants, they may need to strengthen earlier and to a higher standard than the requirements recently announced by government, according to Karen Overend, a commercial property law specialist with Duncan Cotterill
Under the policy, respective Councils will have five years to assess earthquake prone buildings and then the owners will have 15 years to strengthen those identified.
"In many respects, the Christchurch commercial property market is ahead of the Government's move," Overend said.
"Building owners and tenants should also be aware that these requirements are merely a minimum standard. Health and safety obligations are separate from the Building Act regulations, and are likely to pose a higher standard on owners and occupants of buildings, especially in relation to high risk falling hazards."
She said that while the register to be published by the Ministry of Business, Innovation and Employment (MBIE) would be helpful, prospective buyers and tenants of buildings should always make their own investigations in any case, and not merely rely on the register.
"Landlords and tenants should ensure that their leases deal with the strengthening requirements. Many existing leases will not mention earthquake strengthening works at all. They often do not deal with the situation of what will occur under the lease when the works need to be done or the building demolished," Overend said.
"Recent editions of the industry standard form leases are starting to go some way to address these issues, but we recommend that landlords and tenants do not just rely on standard forms, but carefully consider and get advice on what should be included in their lease documents, given the circumstances of the relevant building and the lease."
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