Landlords' responsibilities: what you need to know

In recent years, industrial properties have attracted many property owners to enter the market. If you're one of them, it's essential to understand the key aspects of owning this type of real estate.

To help you navigate property ownership, here are some essential things you should know about being an industrial  landlord in South Africa.

Main responsibilities under common law

Under common law, industrial landlords are obligated to protect the rights and interests of your tenants. Here is a summary of these critical duties:

1. Making the property available and preventing eviction: Apart from the prohibition from evicting the tenant unless mandated by law or for a legitimate reason, such as non-payment of rent or breach of lease terms, the landlord's primary responsibility is to make sure the premises are easily accessible and available for use by the tenant over the lease term.

2. Respecting the tenant's right to enjoy the property: You cannot breach your obligation to allow the tenant to use the premises without disturbance without adequate notice or consent. Landlords must enter the property only in emergencies where rapid access is necessary.

3. Maintaining the property: To use it properly, you must supply and maintain it in fit conditions. It includes conducting routine inspections, fixing maintenance issues as soon as they arise, and making necessary repairs. You must also guarantee the premises are safe and secure for the tenant.

4. Paying property-related taxes: You are obligated to cover taxes associated with the property, such as municipal rates and stamp duty on the lease. Failure to do so can result in legal consequences and financial penalties. Meeting these financial obligations is imperative to avoid legal complications and maintain a harmonious relationship with the tenant.

Having a lease agreement makes everything easier

When drafting lease agreements, you should consider several critical factors beyond your legal obligations, as these agreements often involve adjustments based on the law. It's essential to determine the rent amount, whether it will be fixed or subject to escalation, and whether a security deposit is required. 

Moreover, you should clarify if the tenant will be responsible for extra charges such as municipal rates, cleaning, security, and insurance, and specify who will handle maintenance tasks and cover the associated expenses.

Since 2007, leases for less than five years have been exempt from stamp duty. Landlords should also decide who will pay the stamp duty and clearly define the lease duration, including any provisions for renewal.

Protecting your interests as the landlord

There are risks associated with leasing property, so landlords need to include specific provisions in their lease agreements to protect themselves:

• Specify the kinds of activities the tenant is permitted to engage in on the property to complement the zoning and intended use of the land. One should not use an office block as a restaurant, for instance.
• Prevent the tenant from subletting the property or forwarding the lease without your permission. This will help you avoid handling a renter you don't know.
• Specify the steps to be followed should the tenant breach the lease terms, say not paying rent on time. Ensure the lease shields you from accountability for any flaws and lets you enter the premises should you need to.
• Before permanently altering the property, have the tenant gain your approval. Ensure that any builders operating on the property waive any legal claims (common law liens) over these modifications.

Know your legal rights before leasing

When leasing industrial property, it's important to consider the legal obligations and potential risks. Getting expert legal advice before finalising any lease agreement can help protect your investment and ensure compliance.

You can hire a lawyer specialising in business leases to ensure you're fully protected on rent terms, maintenance duties, subletting clauses, and how to end the lease. Your best bet is to have a well-written lease agreement that lays out each party's roles and duties, as well as any regulations, occupancy dates, and consequences for non-payment.

Choosing us means leasing with confidence

Lease your property to a company that needs it. Our team of professionals can assist you with all aspects of leasing your industrial property at Newpoint Property. List your property with us today, or contact our property professionals for assistance.