How to become a commercial landlord

In 2021, there were around 4.6 million privately rented households in England. But there are also thousands of commercial landlords in the UK who own industrial units, warehouses, office spaces, restaurants, pubs, and more. Owning a commercial property and letting it out can be your gateway to a reliable long-term rental income. 

But how do you get yourself on the ladder and become a commercial landlord? Here, our landlord insurance experts at CIA Landlords go deeper into how to become a commercial landlord.

Commercial mortgages

You may not be able to buy a commercial property upfront with cash. In this case, you will need a commercial mortgage. A commercial mortgage is any loan secured on property which is not your residence. Remember to read the small print, because commercial mortgage loans are not regulated by the Financial Conduct Authority like residential mortgages. 

So, taking out a commercial mortgage policy could well be the first step to you becoming a commercial landlord. You will need to discuss your commercial mortgage application with your bank or a trained advisor, the requirements tend to be higher than for residential property mortgages. 

Commercial landlord insurance

Having commercial landlord insurance as a fallback is a must have for commercial landlords. It will cover you for property owners’ liability, water pipe leaks, flood, fire and storm damage. At CIA Landlords, we can offer you the best in class robust commercial landlord insurance to meet your unique needs. Get a commercial landlord insurance quote here to learn more about our competitive prices. 

Ensuring your tenants’ safety

Landlords must take care of fire safety by providing fire doors and extinguishers in commercial property. It is also the responsibility of the landlord to carry out fire risk assessments of the premises and review them regularly.   

However, it is an employer’s responsibility to ensure staff members are protected from fire risks and up to date with evacuation protocols and what to do in the event of a fire.  

When it comes to gas and electrical safety, it can either be the responsibility of the landlord or the tenant. It will really depend on the conditions set out in the lease.                                

Your commitment as a commercial landlord to maintenance and repairs

Landlords are responsible for making sure the necessary maintenance and repairs of structural elements of commercial property are carried out. Whereas tenants must take care of internal matters like heating repairs.  

What constitutes fair wear and tear of the property over time and who is responsible for it, landlord or tenant, should be stated in the lease. 

Providing energy certificates

Landlords are responsible for installing electrical and heating systems in communal areas. A recent study found that many UK commercial landlords are still slow to implement sustainable strategies. However, they must catch up because as of 1 April 2023, all existing commercial properties must have an EPC rating of E or above.

Interested in taking out a commercial landlord insurance policy that fits your needs? Contact us at CIA on 01788 818 670 or email info@cia-insurance.co.uk.