Premises & Property | Securing Premises

Premises & Property | Securing for your Organisation/Group } Things To Consider

Introduction:

An Organisation/Group reaches a phase in its life when it needs to consider premises according to its needs.

Do we just need offices?

For some causes a front-line service where a shop front would be desirable?

Do we know of another organisation/group we could share the premises with?

Can we make facilities available in our premises to other organisations/groups which would both benefit them and generate income to us that will help towards off-setting the running costs, e.g. meeting/training room?

The cost will likely be the second most highest single expenditure that an organisation/group will have to incur next to salaries. So careful forethought needs to be given before embarking on this major commitment.

Organisations/Groups tend to face a catch .22 dichotomy situation in that they first need to secure funding before they know what they can afford; whereas funders will need to know information about proposed premises and costings before they will consider funding!

Initially, unless a grant or grants have been secured for long-term running costs, e.g. 3 to 5 years, it is best to commit only to a short term rental agreement or lease, whereby if funding ceases, an organisation/group can be released from its obligations under short notice, e.g. around a month. Otherwise reserves need to be budgeted to meet any longer term commitment if you have to terminate an agreement sooner whilst still honouring the minimum period rent/lease notice payable to enable an organisation/group to be released from the legal obligation.

Local Authorities do have their own portfolio of premises they own and manage so make enquiries of the Local Authority in your area as to any suitable premises they may have these Departments are known by different names in Local Authorities, e.g. Valuation & Estates or Management & Estates, or Property Services Department but your Local Town Hall will be able to advise you on this. Many Local Authorities do now franchise the property management of their premises to a contractor, i.e. Estate Agents. Your Local Authority will be able to advise you on this with a list of Estate Agents and their contact details.

Otherwise make enquiries of Estates Agents in your High Street direct, albeit that you should be prepared for them to be business-related minded and offering terms which, (whilst commercially competitive), can be significant and outside a budget or proposed budget or an Organisation/Group.

Look aroundIf you see a 'ToLet' sign displayed, which has been up for some length of time, e.g. 6 months or more, it will likely mean that the Landlords have been unable to get an offer for the terms they are asking, so they is scope to try and negotiate.

Speak to other organisations/groups, they may have space, or willing to share premises (and therefore costs) with you. A combined joint grant-aid application can be made for premises and running costs.

Speak to your Bank about advice and help with securing premises. There are some financial sources who specialise in charities who can provided loans for such purposes, (including Trusts, subject to meeting certain criteria). An option, (suited for some Organisations/Groups, but not all), is a scheme known as 'Rent-To-Buy'.

Above all be realistic about any lettings or bookings you make available to third parties organisations/groups.

Whilst not wishing to charge them an extortionate amount, or making pecuniary gains from such lettings/ bookings, it has to be realised that to provide these costs your Organisation/Group money for heat, light, cleaning, etc. These costs must be realistically covered otherwise your organisation/group will simply go into debt your Organisation/Group losses, having to meet the deficit and justify to funders the inappropriate management of the premises, (which would be hardly conducive to encouraging them funding your Organisation/Group again).

Reference Sources

Risks to charities linked to business rates relief - Charity Commission :

Charities and tax : the basics - HMRC

Charities and direct tax - NCVO

Understanding and promoting tax relief on donations of land, buildings or shares - HMRC

Charities and tax - Gov.UK

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