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Other than Internal Repairing and Insuring (IRI), industrial properties often offer Full Repairing and Insuring (FRI) leases, meaning the tenants are responsible for maintaining, repairing, and insuring the whole building throughout your lease. IRI is considered easier than FRI lease as you will have less responsibility – only cover the upkeep and repairs of the internal parts of your building. However, in terms of rent payment, IRI tends to be more costly than FRI.
What is an IRI (Internal Repairing and Insuring) lease?
Internal Repairing and Insuring (IRI) lease means leasing a building where you only need to pay for the maintenance and repair costs of the internal parts of the properties, while your landlord will look after the exterior parts of the building. For example, if there are any defects in your exterior walls, your landlord will be there to fix them immediately. Find out more about our lease specifications on our Smart Lease or traditional lease. Our leases are typically IRI leases, but it will depend on the unit you’re leasing. In rare circumstances, they may be leased on an FRI lease basis.
What are the differences between IRI and FRI leases?
What are the benefits of an IRI lease?
- You won’t need to worry about your external maintenance anymore and you can allocate more of your precious time to your business. From small fixes to significant repairs — we will make sure to take care of all external repairs.
- By consistently running a high-standard and well-planned maintenance program throughout your lease, we will ensure your building is always clean, tidy, and looking smart to welcome your important customers to pop in for a cup of tea.
- With regular external repair, we strive to help you move in and move out smoothly to avoid time-consuming dilapidations. Many tenants ignore their maintenance and repair obligations – leaving all the work to the end, which may give them a lot of tasks to complete before moving out or getting a dilapidation bills for the issues they have neglected.
Things to consider when negotiating your leases
Schedule of condition (SoC): It would be beneficial to agree with the landlord to include SoC to the lease agreement. SoC is a complete record or photographic evidence of your initial property condition to recognise any changes and exclude your responsibility from any defects at the beginning of your lease. You will be fully responsible for the SoC, but you can also appoint an independent building surveyor to prepare SoC for you to make it more trustworthy.
Maintenance or service charges: make sure you understand all your responsibilities of maintenance charges and you may also negotiate the charges with your landlord.
Dilapidations: make sure your lease is inclusive of dilapidations so you won’t be required to carry out works to return the property to a ‘good and substantial repair and condition’. We often offer an option of lease where dilapidations are not required so you are free to leave without undertaking any repairs at lease expiry. Hence, prior to signing your lease, it is important to understand what may be required when you leave the property. Read more about our guide for dilapidations here.