Subletting....ish - Renting property to a business for their staff to use

[Amethyst]

We (well my parents) have a spare room that's been converted into a studio apt which is rented out. After recently evicting a tenant under section 21, we've just agreed with a local business that they can rent the flat and use it for their staff to reside in ( hotel employees ) - the standard rental agreement we've been using doesn't really cut it in the circumstances, as the rent and utilities is paid for by the business, so do we need a separate contract for the actual tenants ( who may stay for a few nights, few weeks or few months ), for things like responsibility for light bulbs, behaviour, decorating, damage and so on ? Concerns over how to evict a tenant if they are basically subletting from the business we rent it to - or would that become a disciplinary employment issue?

I feel like this might have a whole host of pitfalls actually. What do you reckon ?

[EXC]

Re: Subletting....ish - Renting property to a business for their staff to use

A bit risky, it sounds like you won't have any control over who actually stays there.

[Amethyst]

Re: Subletting....ish - Renting property to a business for their staff to use

Indeed. So I think we need a rental agreement that puts liability for any damage etc on to the business ? and then any further arrangements ( eg employee recompensing business ) would be a matter between the business and the employee ?

[Amethyst]

Re: Subletting....ish - Renting property to a business for their staff to use

A company let is when a company takes on a residential tenancy agreement as the tenant, rather than an individual. A company employee then occupies the premises as a licensee of the tenant.

In this capacity as tenant, the company is responsible for all the tenant's obligations under the terms of the lease, including the payment of rent, council tax and utilities bills.

Seems to explain it...

The pros and cons of company lets

Pros:

There is an effective guarantee that rent and other outgoings will be paid on time
The landlord's ability to contact the tenant isn't dependent on the availability of the occupant, as the point of contact is usually a member of the human resources department of the tenant company
Negotiations are often more professional, resulting in a smoother completion of the letting transaction
Companies are more likely to pay higher rents for quality properties
Company lets can provide maximum exposure of the property within the expatriate community and can therefore ensure minimal vacant periods.

Cons:

If the landlord is a private, non-investment landlord, who takes a personal interest in the property, company lets can seem very impersonal and inflexible
Cash deposits are not always paid, and where the company indemnifies the landlord against damages, the company can be slow in paying the agreed amount
Company tenancy agreements can be difficult to negotiate
Occupants can change without the approval of the landlord
Occupants are almost always foreign, and for landlords who personally manage their properties, communication and cultural differences can cause complications.

[Amethyst]

Re: Subletting....ish - Renting property to a business for their staff to use

Sooo how to amend a pretty standard rental agreement to cover the letting to business for use by employees ?

Rental Agreement

This rental agreement, made this __________day of _______________by and between xxxxxxxxxxxx and xxxxxxxxxx the owners of the premises described below, said owner being hereinafter referred to as ‘Owner’, and ______________________, hereinafter referred to as ‘Resident’. WITNESSETH, that Owner, in consideration of the rent to be paid, and the covenants and agreements to be performed by the Resident, does hereby rent the following described premises, to wit: Situated in the village of xxxxxxxxxxxxxx a single room in ***************** xxxxxxxxxxxxxxxxxxx

Terms and Payment
Resident agrees to occupy said premises for an original term of 6(six) months, said term to commence on ______________________and agrees to pay without demand, in the manner agreed, the rental of __________________on or before the __________of each and every month beginning on_________________________. Any and all payments made under this agreement are to be paid to the owner or owners representative. All payments to be made in cash, certified cheque, money order, online direct transfer or any other method agreed with the owner or owners representative or agent. Subsequent to the initial period rental reviews are at the discretion of the owner.

Additional rent for late payment
In the event the resident pays any monthly instalment after the due day of the month additional rent calculated at an interest rate of 2% per month above the current bank base rate or 5% per month whichever is the greater will become payable. Where circumstances prevent payment on the due date arrangements are to be made by the resident to make payment in advance of the due date to ensure late payment does not occur. Payment is only deemed to have occurred once cleared into the owners rent bank account.

Rent reserve
Resident has agreed to deposit with the owner or owners representative a rent reserve in the amount of one months rent. Said rent reserve is to guarantee the return of the premises to the owner in the same or better condition as when accepted by the resident, reasonable wear excepted, please note this includes cleaning for which a charge will be made. Determination of reasonable wear at the discretion of the owner. The rent reserve is to indemnify the owner against damage and or loss of value as a result of resident’s action, mistake or inaction during the term of occupancy. The rent reserve may not be applied by the resident as and for payment of any rent due to the owner prior to the vacation of the premises by the resident. Should the resident be responsible for loss and or damage of value greater than the value of the rent reserve the resident hereby agrees to reimburse the owner for such loss immediately upon presentation of a bill or invoice for said loss.

Notice to terminate and renewal
Unless another rental agreement is signed by the parties hereto or unless written notice of termination is given by one party to the other party one month or 30(thirty) days, for the tenant after the expiry of the 6(six) month initial period, whichever is the greater at the time of notice before expiration of this agreement, this contract shall be automatically renewed on a month-to-month basis and may be terminated thereafter by either party upon the giving of written notice to the other party one month or 30(thirty) days, whichever is the greater prior to the next periodic rental due date. Resident shall include with said notice a forwarding address if one is available. Termination shall take place only on the last day of the rental month unless otherwise agreed in writing. Upon vacating resident agrees to return the premises to the owner in the same or better condition at the owners discretion as when received, reasonable wear excepted. Determination of reasonable wear at the discretion of the owner. Under no circumstances shall a dirty or broken condition of the premises, appliances or fixtures or any item listed on the inventory be considered as having resulted from reasonable wear.

Examination of premises
Resident has examined premises and has accepted same as habitable and satisfactory. Resident shall have 72 hours after entering premises in which to examine same for defects or damages and report said findings to owner or owners agent. Resident while residing in said premises shall observe and act in accordance with all and any rules and regulations attached hereto and made part hereof as if fully written herein. Owner reserves the right to inspect premises at intervals during the tenancy.

Resident’s responsibility
The resident shall:
Keep that part of the premises that he/she occupies and uses safe and sanitary.
Dispose of all rubbish, garbage and other waste in a clean, safe and sanitary manner.
Keep all plumbing fixtures in the dwelling or used by the resident as clean as their condition permits.
Use and operate all electrical and plumbing fixtures properly.
Comply with the requirements imposed on residents by all applicable national and local housing, health and safety codes.
Personally refrain, and forbid any other person who is on the premises with his/her permission from intentionally or negligently destroying, defacing, damaging or removing any fixture, appliance, other part of the premises or any item listed on the inventory.
Maintain in good working order and condition any range, refrigerator, washer, dryer or other appliances supplied by the owner and required to be maintained by the resident under the terms and conditions of this agreement.
Conduct himself/herself and require other persons on the premises with his/her consent to conduct themselves in a manner that will not disturb his/her neighbours’ peaceful enjoyment of the premises.
The resident shall not unreasonably withhold consent for the owner to enter on the premises in order to inspect said premises, make ordinary, necessary, or agreed repairs, decorations, alterations, or improvements, supply necessary or agreed services, or exhibit the premises to prospective or actual purchasers, mortgagees, other workmen or contractors.

Owner’s responsibility
The owner shall:
Comply with requirements of all building, housing, health and safety codes which materially affect health and safety.
Make all repairs and do whatever is reasonably necessary to put and keep the premises in a fit and habitable condition.
Keep all common areas of the premises in a safe and sanitary condition.
Maintain in good and safe working order and condition all electrical, plumbing, sanitary, heating, ventilating fixtures and fittings, supplied or required to be supplied.
Supply running water at all times and reasonable heating as determined by the owner.
Not abuse the right of access.
Except in case of emergency or if it is impractical to do so give the resident reasonable notice of intent to enter and enter only at reasonable times. Twenty four hours is considered to be reasonable notice in the absence of evidence to the contrary.





Owner’s liability
Owner shall not be liable for any damages or losses to person or property caused by anyone not under the direct control and specific order of the owner. Owner shall not be liable for personal injury or damage or loss of resident’s personal property from theft, vandalism, fire, water, rainstorms, smoke, explosions, sonic booms or other causes not within the direct control of the owner and the resident hereby releases owner from all liability for such damage. (If protection against loss is desired it is suggested that resident secure insurance coverage from a reputable company). Owner shall not be responsible for any damage or injury caused by failure to keep the premises repaired if the need for said repair was not communicated to the owner by the resident and was not reasonably within the knowledge of the owner or agent. Owner shall not be liable for damages if the resident is unable to occupy the above premises as of ____________day of ______________________ when residents inability is due to circumstances not within the control of the owner. If the owner is not able to deliver possession to the resident within 30 (thirty) days of the date set forth above for the commencement of the term resident may cancel and terminate this agreement.

Utility charges
Resident agrees to pay all charges and bills incurred for electricity and telephone which may be assessed or charged against the resident or owner for the premises during the term of this rental agreement or any continuation thereof except those charges and bills the owner has herein agreed to pay.

Alterations
Resident agrees not to make any alteration or paint or cover walls or surfaces of the rental premises with any material whatsoever without the prior written agreement of the owner.

Re-rental charge
If the resident vacates the premises prior to the fulfilment of this agreement additional charges over and above the monthly rental amount will be assessed to cover all costs incurred by the owner in the re-rental of the premises.

Eminent domain
If all or any part of the premises is taken by, or sold under threat of, appropriation, this agreement will terminate as of the date of such taking or sale. The entire award or compensation paid for the property taken or aquired, and for damages to residue if any will belong entirely to the owner and no amount will be payable to the resident.

Pets
No pets or animals will be permitted without the written prior consent of the owner. Any permission so granted may be revoked at any time by the owner.

Washing machine
The household washing machine may be used by the resident on a shared basis by agreement and as convenient to all.

Smoking
The resident agrees to abide by the rule that smoking is not permitted in the rental premises or common areas.

Assignment
Resident may not assign this rental agreement or sublet the premises or any part thereof without the prior written consent of the owner.

Occupancy
Resident agrees that the premises will be used for residential purposes only and will be occupied only by said __________________________. The premises will not be used or allowed to be used for unlawful or immoral purposes, nor for any purposes deemed hazardous by owner, agent or owners insurance company because of fire or any other risk.

Property damage
In case of partial destruction or injury to the premises by fire, the elements or other causality not the fault of the owner or resident, the owner shall repair the same with reasonable despatch after notice of such destruction or injury. In the event said premises are rendered totally uninhabitable by fire, the elements or other causality not the fault of the owner or resident, or in the event the building of which the above premises are part(though the premises covered hereunder may not be affected) be so injured or destroyed that the owner shall decide within a reasonable time not to rebuild the term of this agreement shall cease and rent shall be due only through the date of such injury or damage.

Breach of contract
In the event the resident is in default of any of the terms or obligations of this rental agreement (which includes non-payment of rent or any rules or regulations herein or hereafter adopted by the owner for buildings, drives, parking areas or grounds) and owner requests resident to vacate the premises as a result thereof or because of said default by resident, owner initiates forced entry and detainer action, by delivering a notice to vacate the premises to resident as prescribed by law, or owner files a complaint in forced entry and detainer with the court or owner is awarded a judgement order for restitution of the premises, the mere act of vacating the premises by resident as a result of any of the foregoing acts does not terminate the obligation of the resident to pay rent for the remainder of the rental period for which no rent has been paid. Resident remains liable to owner for all rent and any other damages incurred until the end of the agreement term or when the property is re-rented, whichever event occurs first.


THIS AGREEMENT SHALL NOT BE BOUND BY ANY TERM, CONDITION, OR REPRESENTATION ORAL OR WRITTEN NOT SET FORTH HEREIN. IN WITNESS WHEREOF, OWNER AND RESIDENT EXECUTED THIS AGREEMENT IN DUPLICATE ON THE DAY AND YEAR FIRST WRITTEN ABOVE.


OWNER___________________________________sign RESIDENT__________________________________sign

OWNERS NAME_________________________________RESIDENT NAME_____________________________________

WITNESSED BY________________________________________________ ____________________________________

__________________________________________________ _____________________________________________sign

[Crazy council]

Re: Subletting....ish - Renting property to a business for their staff to use

Insurance. that the only thing that it affects really.

Make sure any morgagee insurance, or building insurance cover knows. I know a few peole that are currently letting to business under similar terms ( were are a port, and service the windturbines, ) and have done the same since the 90s, due to the refinary and chemical plants near here. The let is with teh company in relation to costs, damages ext, but the terms of the tenacy are nerly the same if i remeber correctly, apart from insurance and liability issuse.

The only thing am not sure about is the fact that the spare room is part of a residential property, but sa long as its not against any planning restrictions, i cant see that being an issue

I will ask if they had any issue when setting up ,when they get back at the weekend. I can say, its worked out fantastically well for all the accounts i know that have been like this, both finacialy and maintainece wise,