Many GP practices have recently had the go ahead to proceed with premises improvements thanks to the utilisation and modernisation grants available from NHS England.
Those practices lucky enough to be awarded the funding must now consider the impact of the grant funding agreement.
These agreements are in standard form and differ depending on the value of the grant and whether you hold your premises as leasehold or freehold.
Where freehold premises are involved and the grant exceeds £144,000, it may be necessary to grant a legal charge over the surgery premises. While this requirement is not unreasonable, it can introduce additional complexities, particularly if there is existing lending at the property.
Freehold owners should also consider how abatement may affect rent reimbursement. Tenants, however, should not see any change, as the rent should disregard the impact of tenant-funded improvements.
Tenants must, however, be aware that as well as complying with the terms of the grant they must also comply with the requirements in respect of alterations in their leases.
Now is a good time to check the title to your premises ensuring that the current partners are registered as legal owners at the Land Registry.
Practices are strongly advised to take legal advice before proceeding with the grant funding.
We're currently supporting several practices nationwide on this issue. If you’d like to find out more, please contact Jennifer Lewis.
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