Dilapidations: Seven Steps Before a Commercial Lease Ends

These issues are usually easier to manage when the parties review the lease and premises early. Leaving matters until the final weeks of the tenancy can limit the time available to carry out works, resolve uncertainty and prepare the property for handover or reletting.

1) Check what the lease requires 

The lease is the starting point for understanding the tenant’s responsibilities. It may require the tenant to repair and maintain the premises, redecorate at specified times, remove its belongings, and return the property in a particular condition. 

The relevant obligations should be read together rather than in isolation. Repair, decoration, alterations, statutory compliance and yielding-up provisions (the terms setting out how the premises must be handed back) may each affect what the tenant must do before leaving. 

2) Review alterations and reinstatement 

Tenants frequently make changes to commercial premises, including partitioning, signage, cabling, equipment, or a new fit-out. The lease and licences for alterations should be checked to establish whether those works must be removed and the original layout reinstated. 

In some cases, reinstatement is automatic. In others, the landlord must give notice requiring removal. Both parties should check the procedure and any deadline well before the lease expires. 

3) Arrange a dilapidations survey 

A dilapidations survey compares the condition of the premises with the obligations in the lease and related documents. For a tenant, arranging the survey early can help identify likely work and allow sufficient time to plan, obtain quotations, and appoint contractors. 

For a landlord, an inspection can help establish the property’s condition and identify matters to raise with the tenant. It can also assist with planning for reletting, refurbishment, or the landlord’s own occupation. 

4) Consider a schedule of dilapidations 

A schedule of dilapidations is usually prepared by the landlord’s building surveyor. It identifies alleged breaches of the tenant’s obligations, and the work said to be required. 

A terminal schedule of dilapidations may be prepared at or around lease expiry. If provided before the end of the term, the tenant should review it with its solicitor and surveyor against the lease, the condition of the premises, and any schedule of condition. 

If matters are not resolved, the parties and their advisers should also be aware of the dilapidations protocol. It applies to terminal dilapidations claims for commercial property in England and Wales and provides a framework for exchanging information before proceedings. 

5) Decide whether work should be carried out 

A tenant may choose to complete appropriate repairs and reinstatement work before leaving. This may provide greater control over contractors, specification and cost, but the tenant should first check the scope of work and whether the landlord’s consent is required. 

The parties should also discuss the landlord’s plans. There may be little commercial benefit in removing useful alterations only for the landlord or an incoming tenant to install similar items again. Any agreement that works can remain should be recorded in writing. 

6) Plan the handover 

What happens when a commercial lease expires depends on the lease and whether the tenant has a statutory right to remain. The parties should not assume that the expiry date alone necessarily ends the tenancy, particularly where the lease may have security of tenure under the Landlord and Tenant Act 1954. 

Where the tenant is leaving, the parties should agree the practical arrangements, including: 

• the date and time for returning possession; 

• removal of furniture, stock, equipment and waste; 

• removal of signage and branding; 

• return of keys, access cards and security information; 

• meter readings and utility information; 

• provision of testing, maintenance and servicing records; and 

• a joint inspection of the premises. 

7) Keep a clear record in case of a dilapidations claim 

Both parties should retain an accurate record of the property’s condition before and at lease expiry, including dated photographs, inspection reports, contractors’ invoices and evidence of servicing or completed work. 

If the landlord agrees that alterations may remain or that particular work is not required, that agreement should be recorded in writing. A clear record reduces the scope for disagreement after the tenant has left.

Dilapidations: frequently asked questions 

What are dilapidations? 

Dilapidations are failures to comply with commercial lease obligations relating to the physical condition of the premises. They commonly involve repair, decoration, reinstatement of alterations and the condition in which the property must be returned. 

What is a terminal schedule of dilapidations? 

It is normally prepared by the landlord’s surveyor at or around the end of the lease. It identifies alleged breaches and the remedial work said to be required. The tenant should check each item against the lease, licences for alterations, any schedule of condition and the actual state of the premises. 

What is the dilapidations protocol? 

The dilapidations protocol applies to claims for damages against tenants concerning the physical state of commercial property at the termination of a tenancy. It provides a framework for exchanging information before proceedings. If the matter becomes disputed, specialist dispute resolution advice may be required. 

What happens when a commercial lease expires? 

If the tenancy is ending, the tenant will usually need to vacate and return the premises in accordance with the lease. However, some business tenancies have security of tenure under the Landlord and Tenant Act 1954 and may continue after contractual expiry, so the position should be checked. 

Next reads 

• Full Repairing and Insuring Lease: Who Pays for Commercial Property Repairs?

• EPC Commercial Property: Green Leases and Energy-Efficiency Improvements

Commercial lease and renewal advice 

Our Commercial Property team advises landlords, tenants, investors and owner-occupiers across London on new leases, lease renewals, Heads of Terms and rent review drafting. 

If you are negotiating terms now, we can help you assess the practical impact on your proposed lease or renewal. Call 020 8858 6971 or email commercialpropertyenquiries@grantsaw.co.uk to discuss your circumstances. 

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Disclaimer 

This article is for general information only and is not legal advice. Laws and guidance change and outcomes depend on facts. If you need advice on your situation, please contact us. Grant Saw Solicitors LLP is authorised and regulated by the Solicitors Regulation Authority. 

Last updated: 27 October 2026