Brady Solicitors mixed-used specialists take a look at a recent case where The Upper Tribunal dismissed the appeal of a landlord and provided clarification of Leaseholders’ right to appoint a manager in mixed-used properties.

The leaseholders speak up

Freeholders of mixed-use buildings might not be aware that leaseholders have the right to appoint a manager to manage a building if there is a commercial property element of the freehold. This power was recently exercised in the case of Queensbridge Investments Ltd v Lodge and others, where the leaseholders of a mixed-use building appointed a manager based on the grounds of negligent management from the current landlord/ managing agent. This meant the landlord had no further control over the spending of the service charges on their property.

The Upper Tribunal dismisses appeal

The landlord appealed to the Upper Tribunal with the reasoning that the FTT has no powers to appoint a manager over the commercial parts of the building and that no complaint had been made by the commercial leaseholder. This appeal was dismissed on the grounds that the building was better managed as a whole unit due to serious mismanagement.

Poor service to either leaseholders or commercial tenants could result in loss of management of the whole block. Another key aspect to consider in the event of leaseholders wishing to proceed with an Appointment of a Manager application is that both commercial and residential units do not have to lodge complaints at the same time. With reference to Queensbridge Investments Ltd v Lodge and others, the complaint was brought solely by the residential leaseholders.

Who can manage your mixed-use building?

If you have a mixed-use property portfolio you can appoint a managing agent to look after both your commercial and residential units. If you are a leaseholder (or a group of leaseholders) wishing to proceed down the Appointment of Manager process you will need to fulfil certain criteria:

  • The application needs to cover the whole, not part of the building
  • The building needs to contain two or more flats
  • The landlord not be a local authority, a registered provider or charitable housing trust

At Brady Solicitors we are FTT experts, we can advise and guide you through the Appoint a Manager process or any other legal property management matter whether straightforward or complex. If you’re looking for clear cut advice on mixed-use property, drop us an email via enquiries@bradysolicitors.com or call us on 0115 985 3450 and we’ll happily to talk you through your options.

We previously published a handy blog explaining the process of Appointment of a Manger, take a read here.