Talkspace Group

Latest legislation on replacing air conditioning & consideration with leases

(recent article from RICS Journal Sept - Oct 2012)

Some air conditioning systems predating 2004 use HCFC gas R22.  From 2015, its use will become illegal.  Systems manufactured since 2004 have not used gas R22 and only recycled R22 or decommissioned equipment may be used for maintenance of existing systems.  As time goes on, recycled or reclaimed R22 becomes scarcer.

From 2015, a ban will exist on the use of R22 and so conversions or replacements will need to be considered, with these costs varying from system to system.

If tenants are moving towards the end of their lease, they may be keen to avoid making a contribution towards the conversion or replacement costs.  In a similar way, tenants signing a new lease may be reluctant to sign a full repairing lease if current equipment uses R22.

It would be prudent for purchasers and tenants to consider this impending ban when negotiating heads of terms.


Source: www.rics.org/us/knowledge/journals/commercial-property-journal/recent-editions/commercial-property-journal-september-october-2012/