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Tenants Improvements
The expression Tenant's Improvements
is used to describe a wide range of works, that are
usually carried out by a tenant, at their own cost,
and usually require the proprietor's prior approval.
Tenant's improvements may not necessarily
increase the value of the demised premises, but can
have an impact upon the future rent payable by a tenant.
The Proprietor & Tenant Agreement provides that
a covenant in a lease against the making of improvements,
without the consent of the proprietor, is deemed to
be subject to a proviso that consent will not be unreasonably
withheld.
As a condition of consent however,
the proprietor will often require: The payment of a
reasonable sum in respect of any damage to or diminution
in the value of the premises or of any neighboring premises
also in the proprietor's ownership.· The payment
of the proprietor's legal and other proper expenses
incurred in connection with the granting of consent,
usually by way of a Licence.·
In cases where the improvement does
not add to the value of the demised premises, a covenant
from the tenant to re-instate at the end of the lease.
Most rent review clauses will include
a provision whereby Tenant's Improvements are ignored
for the purposes of assessing the revised rental value.
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