PROPERTY REPORT
OF
Industrial Unit

To be read in conjunction with the Schedule of Condition

FOR
Mr Industrial
Prepared by:

GEM Associates Limited
INDEPENDENT CHARTERED SURVEYORS

Marketing by:

www.1stAssociated.co.uk

0800 298 5424

CONTENTS

Introduction

Synopsis

Summary of Construction

Facilities

Report Format and Information

Executive Summary

Summary Upon Reflection

Limitations

INTRODUCTION

We have been asked to inspect and prepare a Property Report and Schedule of Condition for an Industrial Unit.

This Report is to be read in conjunction with the Schedule of Condition.

SYNOPSIS

SITUATION AND DESCRIPTION

The property is located within an industrial area with a mixture of businesses and building type. There appears to be three parking spaces to the front of the property and we have assumed that you have right of access, but this needs, of course, to be confirmed with your solicitor.

This is a middle warehouse unit with offices, toilet facilities and a warehouse.

If the age of the property interests you your Legal Advisor may be able to find out more information from the Deeds.

SUMMARY OF CONSTRUCTION

External

Main Roof:

A pitched roof clad with profile metal sheeting (partially visible)

Gutters and Downpipes:

Valley gutters to the perimeter of the property and internal downpipe

Soil and Vent Pipe:

Not visible

Walls:

Consists of a structural frame with profile metal cladding to the gables of the property and cavity brick / blockwork forming the main walls

External Joinery:

Windows and doors formed in single glazed aluminium units

Internal

Ceilings:

In-fill panels within the warehouse and plasterboard to the office areas on the ground floor and a suspended ceiling to the office areas on the first floor (assumed)

Walls:

Mixture of solid walls and studwork partition walls (assumed)

Floors:

Ground Floor: Solid underfoot, assumed concrete

First Floor: Solid underfoot, assumed to be reinforced concrete (assumed)

Services

We have assumed that the property has a mains water supply, drainage, electricity and gas.

We have used the term 'assumed' as we have not opened up the structure, your solicitor needs to carry out checks in relation to these matters.

EXTERNAL PHOTOGRAPHS

Front View

Rear View

FACILITIES

Measurements

The selling agent's details advise:

3,040 sq ft (228.53 sq m)

Divided between warehouse area:

1,956 sq ft (181.75 sq m)

With office space on both the ground and first floor taking up the majority of the remaining space.

The selling agent's details also advise that the property has an overloading door 12ft in width by 15ft 9ins and a minimum eaves height of 16ft 6ins raising to 22ft and 6ins (all information taken from the Commercial selling details).

Ground Floor

• Office Unit
• Ladies / Disabled Toilets (w.c. and wash hand basin)
• Gents Toilet (w.c., urinal and wash hand basin)
• Access Corridor leading to Work space
• Warehouse Area
• Kitchen (free standing)

First Floor

• Office Unit

Outside Areas

It would appear that the property has three parking spaces and we assume a Right of Access.

There are no facilities for smokers under the new Legislation that came into force on 1st July 2007.

REPORT FORMAT AND INFORMATION

To help you understand our Report we utilise various techniques and different styles and types of text, these are as follows:

PHOTOGRAPHS

We utilise photographs and sketches to illustrate issues or features. In some photographs a pencil has been used to highlight a specific area.

ACTION REQUIRED AND RECOMMENDATIONS

We have used the term ACTION REQUIRED where we believe that there are items that you should carry out action upon or negotiate upon prior to purchasing the Lease.

Where a problem is identified, we will do our best to offer a solution. However, with most building issues, there are usually many ways to resolve them dependent upon cost, time available and the length of time you wish the repair/replacement to last.

MARKET VALUE

We have not been asked to comment upon the market value in this instance. We have not seen copies of the trading figures or the accounts.

EVERY BUSINESS TRANSACTION HAS A RISK

Every business transaction has a risk, only you can assess whether that risk is acceptable to you and your circumstances.

AGENT / BUSINESS DEVELOPMENT MANAGER FRIEND OR FOE?

It is important to remember that the agents are acting for their client and not the purchaser. We, as your employed Independent Chartered Surveyor, represent your interests only.

SOLICITOR/LEGAL ADVISOR

TERMS OF ENGAGEMENT/LIMITATIONS

This report is being carried out under our terms of engagement, as agreed to and signed by you. If you have not seen and signed a copy of our terms of engagement please phone immediately.

OUR AIM IS ONE HUNDRED PERCENT SATISFACTION

Our aim is for you to be completely happy with the service we provide, and we will try and help you in whatever way possible - just phone us.

EXECUTIVE SUMMARY

Summaries are dangerous as they try to précis often quite complex subjects into a few paragraphs. This is particularly so in a summary about someone's future business when we are trying to second-guess what their priorities are, so it is important the Report is read in full.

It is inevitable with a report on a building of this nature that some of the issues we have focussed in on you may dismiss as irrelevant and some of the areas that we have decided are part of the 'character' of this property you may think are very important. We have taken in the region of one hundred and fifty photographs (a CD copy of all photographs is enclosed) during the course of this survey and many pages of notes, so if an issue has not been discussed that you are interested in or concerned about, please phone and talk to us before you purchase the lease (or indeed commit to purchasing the lease), as we will more than likely have noted it and be able to comment upon it. If we have not we will happily go back. Having said all of that, here are our comments:

When purchasing the lease on a business we believe there are three elements you need to consider, these are:

The Business

Only you can decide upon the true potential the property has for your business and its value to you; although we do recommend you take independent advice on the value of the property.

The Lease

The quality of the lease needs to be discussed with your Legal Advisor and understood. You need to understand your rights, responsibilities and liabilities when you sign for a lease of this nature. We ask that your Legal Advisor brings any onerous or unusual clauses to our attention immediately. For the purposes of this report we have assumed that this is a standard full repairing and insuring Lease. Please advise us immediately if it is not.

The Property

There are many aspects to look at property-wise, both from its condition at the moment, to its condition in relation to the lease (or in this case a standard full repairing and insuring lease, as we have not seen the one specifically relating to this property).

You are currently reading the Property Report which is intended to advise you on the property element of the purchase. We will also provide you with a Schedule of Condition, which will enable you to agree with the Landlord the condition of the property when you start to lease it.

Generally we found the property to be in average condition externally (excluding the roof that we could not view) and in below average condition internally; however, there are also several specific issues that we wish to draw to your attention.

We have divided the Executive Summary into 'The Good', 'The Bad' and 'The Ugly', to allow you to clarify and focus on exactly what the issues are.

The Good

Survey reports often are full of only the faults and general 'doom and gloom', so we thought we would start with some positive comments on the property!

• Location to your existing business.
• The availability (considering the time pressures you discussed with us).

The Bad

Problems / issues raised in the ‘bad’ section are usually solvable, but often need negotiation upon. However, a large number of them may sometimes put us off the property.

1. Fire Regulations

   Currently the property is not to Fire Regulation standards, for example the fire signage needs to be changed.

   ACTION REQUIRED: We would recommend that a specialist fire protection company is asked to visit the premises and advise. The rules and regulations relating to fire safety have recently changed and they will be in the best position to give you guidance on how to comply.

   ANTICIPATED COST: In the region of a few thousand pounds. We would recommend that a quotation is obtained.

2. Redecoration Throughout

   Most properties such as this have a Lease clause that requires the Lessee to redecorate on a regular basis and also to redecorate when vacating the property. In this case redecoration does not appear to have taken place at all (with the exception of the floor to the warehouse that has been partially carried out).

   ACTION REQUIRED: Landlord to insist that the existing Lessee redecorates throughout, or you accept a suitable financial sum to allow you to carry out the work.

   ANTICIPATED COST: In the region of £2,500 -£5,000, taking into consideration the repairing of the impact damage within the warehouse which is discussed below.

3. Impact Damage and General Wear and Tear

   Throughout the property there is some impact damage, particularly, for example, in the warehouse areas to the columns, and general damage. All of this needs to be made good.

   ACTION REQUIRED: Repair impact damage.

   ANTICIPATED COST: This should be carried out as part of the redecoration work at the existing Lessee's cost / the Landlord's cost.
   

4. Roof

   We have experienced problems in the past with this type of valley gutter roof. This is a valley gutter roof with a hidden drainage.

    

   To the rear of the property green mould can be seen to the brickwork, indicating to us that there are leaks in the area of the roof.

   ACTION REQUIRED: The roof needs inspecting prior to legally committing to purchase the Lease.

   The skylights also need cleaning as we noted they were dirty and dusty.

5. Gutters and Downpipes

   We briefly discussed the hidden guttering; we would also like to specifically mention the downpipe.

   Whilst some of the downpipes are internal the downpipe to the front right hand side is visible externally and green mould could be seen around to the brickwork, indicating that the pipe is blocked or is partially leaking.

   ACTION REQUIRED: You need to inspect this next time it is raining. You may need to add a rodding eye and rod into the drains.

6. Block Paving to Parking Area

   The block paving to the parking area has settled unevenly. This usually occurs due to the bed that it has been laid on not being prepared correctly.

   ACTION REQUIRED: To resolve the matter would normally require the digging up of the block paving, forming a new bed, and re-bedding.

   ANTICIPATED COST: In the region of a few thousand pounds.

7. Parking

   As we left you talking to the Manager / Owner of the adjoining property, we are sure that he has explained to you his concerns about the parking problems. From what we understood the parking and access problems do depend upon what sort of vehicles you require to access the property and at what times.

   ACTION REQUIRED: You need to make sure that you are happy with the situation and that you can operate your business successfully from the premises.

8. Exposed Services

   Within the warehouse area there is various wiring and piping that is exposed that really needs either boxing in or placing into conduit.

   ACTION REQUIRED: Box in pipework and wiring.

   ANTICIPATED COST: A few hundred pounds.

   Pipework from kitchen (obviously if expect to remove the kitchen there is no need to do this).

9. Sanitaryware

   Generally the sanitaryware would benefit from a good clean. Also, there looks to have been a build up of scale in some areas.

   ACTION REQUIRED: General good clean.

   ANTICIPATED COST: A few hundred pounds.

10. Asbestos

    This item is more a statement of fact. You should have a Type Two Asbestos Survey passed on to you as this is a requirement under most standard full repairing and insuring leases.

    ACTION REQUIRED: Your solicitors to make enquiries as to whether this has been carried out and to obtain a copy.

11. Retaining Wall to Rear

    To the rear of the property there is a retaining wall in which we noted some movement cracks. We are uncertain whether this wall is the boundary wall as we have not seen a copy of the Deeds. You need to establish who has responsibility for this wall.

    ACTION REQUIRED: Your solicitor to establish that the rear retaining wall is not the responsibility of the Lessee.

The Ugly

We normally put here things that we feel will be difficult to resolve and will need serious consideration.

There are no items that we feel would fall within this category.

Other Items

Moving on to more general information.

Electrics

Whilst we have carried out a visual inspection of the electrics we also need to advise you of the following:

ACTION REQUIRED: As the property is changing occupancy the Institute of Electrical Engineers (IEE) recommend an NICEIC (or equivalent) registered and approved electrical contractor carry out an inspection, test and report.

Maintenance

This type of property is relatively modern (i.e., less than one hundred years old) but nevertheless still requires ongoing maintenance and repair. A budget for such work must be allowed to ensure it is maintained in a good condition. This will prevent undue and unnecessary deterioration.

Estimates of Costs

Where we have offered an estimate of building costs please remember we are not experts in this area. We always recommend you obtain quotations for the large jobs before purchasing the property (preferably three quotes). The cost of building work has many variables such as the cost of labour. For unskilled labour we currently use between £75 and £100 per day (the higher costs in the city areas) and for tradesmen we use between £100 and £200 per day for an accredited, qualified, skilled tradesman. Other variations include the quality of materials used and how the work is carried out, for example off ladders or from scaffold.

If you obtain builders estimates that vary widely, we would advise the work is probably difficult or open to various interpretations and we would recommend a specification is prepared. It would probably be best to supervise the work if it is complex, both of which we can do if so required.

SUMMARY UPON REFLECTION

The Summary Upon Reflection is a second summary so to speak, which is carried out when we are doing the second or third draft a few days after the initial survey when we have had time to reflect upon our thoughts on the property. We would add the following in this instance:

We feel you should negotiate on the general decorative condition and associated repairs and also upon the parking bay movement.

We feel the main issue that may prevent you from operating your business properly is access to the warehouse and the parking arrangements. We have not had any experience of this other than discussions with the adjoining property manager / owner.

As a general comment for any work required we would always recommend that you obtain at least three quotations for any work from a qualified, time served tradesperson or a competent registered building contractor prior to legal completion.

We would ask that you read this Property Report and the Schedule of Condition and contact us on any issues that you require further clarification on.

LIMITATIONS

As per our original Terms of Engagement, we would remind you specifically that:

We have not inspected parts of the structure that were covered, unexposed or inaccessible during our inspection. We therefore cannot confirm that such parts are free from defect, structural or otherwise.

We have not determined whether any hazardous materials such as high alumina cement, calcium chloride, asbestos etc have been used in the construction.

Our report is for the use of the party to whom it is addressed above and no responsibility is accepted under the Third Parties Act or for any third parties who use this report in whole or in part.

We have not carried out a comprehensive test of any electrical, mechanical or drainage services. We therefore cannot confirm that they are operational and in good condition. If you wish us to arrange tests please advise us.

We have not carried out or arranged for specialists to undertake any reports, for example an environmental report or an audit report upon the property. We are therefore unable to advise whether any contaminated or other adverse environmental issues affect the site.

If you would like any further advice on any of the issues discussed (or indeed any that have not been discussed!) then please do not hesitate to contact us on 0800 298 5424.

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