Licence to use Furnished and Serviced Office Suite (with Inclusive Rent)
This Licence to use Furnished and Serviced Office Suite (with Inclusive Rent) should be used where the owner of an office building is providing serviced office accommodation to business occupiers. There is no separate service charge so the rent must include an amount to cover the cost to the owner of providing the services.
Provision of serviced accommodation tends to be construed as a licence arrangement, rather than a lease. This Licence is drafted so that the Licensor is responsible for repairs and maintenance and for providing the facilities and services that are needed on a day to day basis. If the Licensor is not providing a significant level of services to the office accommodation it would be advisable to use a lease instead and exclude the tenant’s security of tenure.
Clause 1 contains the definitions. The “Licence Fee” should include a charge for any services provided by the Licensor. There is no separate service charge. Provision of services is covered in Clause 4.
The definition of Premises makes optional reference to a plan. It is recommended that a plan is included, showing the Premises edged red, so that the extent of the Premises is clear.
The “Permitted Hours” should reflect the building’s opening hours.
Clause 2 contains the grant of the Licence and the procedure for terminating it before the end of the Licence Period.
Clause 3 contains the Licensee’s covenants. These cover payment of the Licence Fee and other outgoings, use, alterations and the Licensor’s right of entry.
Clause 4 contains a covenant regarding the provision of facilities and services. The list of services should be checked carefully and amended to reflect the services the Licensor will actually provide. As there is no service charge, the Licence Fee should include a charge for any services provided by the Licensor. Clause 4 also provides for the Licensee to have access to the Premises via the common parts of the building.
Clause 5 contains some standard clauses including a requirement for notices (e.g. a notice to terminate the Licence) to be served in accordance with section 196 of the Law of Property Act 1925. This means that notices should be delivered by hand or sent by recorded or special delivery post. If the notice is sent by recorded or special delivery post, service is deemed to occur at the time at which the letter would “in the ordinary course” be delivered.
Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
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