Client: Michelin Services
Michelin Tyre occupies a 27,000 sq ft office on Manchester Technopark that is occupied by its administrative and finance division, Michelin Services. Held under two separate underleases, Michelin was recently faced with a rent review on one lease, and a forthcoming break clause on the other.
It appointed our landlord and tenant experts to advise on both leases.
Solution
The landlord had yet to serve notice on Michelin’s rent review, but we proactively inspected the property, analysed the local office market and reported on current and future rental conditions. Manchester Technopark is located on the fringe of the city which had experienced oversupply and limited demand in recent years. In our opinion, there was no evidence of rental growth over the five-year period, and in pressing the landlord to trigger the rent review, we made it very clear that we would refer to a third party for determination if required.
On its break clause on the other lease, we advised Michelin to exercise the break to cut costs and to utilise their office space more effectively.
The results
Our rent review experts secured a nil increase in Michelin Services’ rental payments of almost £350,000 per annum, and helped save them additional costs by advising the company to exercise its break clause.
|
|