Deed of Variation (Share of Freehold)

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    Deed of Variation (Share of Freehold)

    Morning!

    We own top floor flat in a share of freehold of 5 flats.
    4 flat owners (who are also 4 directors) are ok to demise the loft space above our flat to our lease.
    the lower ground flat owner, who is also a director in the management company, doesn't want it to be demised to our flat.

    The loft will be used only for storage and not for a conversion or extension.
    The only loft access is via our flat

    Is the ultimate decision based on a majority vote, or all directors need to approve the deed of variation?

    Many thanks for your help

    #2
    This appears to be the company variant of a share of the freehold.

    From a company law point of view, this will be determined by the company articles. If they are silent, a simple majority is required, but they may rely a special resolution, in general meeting, with over 75% of the members (not just directors) agreeing, or an even larger majority.

    You also need to consider the lease. It have clauses which would cause your actions to breach the other leases, in which case all those affected must agree.

    Also, the board really should be considering whether all the leases should be modified to increase your share of the service charge contribution (including insurance) etc.

    Unless you are already responsible for the maintenance of the structural woodwork in your ceiling, they should be insisting on a structural survey to ensure that is strong enough to support the storage you intend to place there.

    Comment


      #3
      How much are you paying ( £'s ) to increase the demised area of the flat by having the loft space added ?

      Comment


        #4
        thanks!
        we agreed to do it for symbolic £1 as I will also be assuming the cost of maintenance, and dead of variation will explicitly mention alteration/conversion into a room is not allowed

        Question regarding the actual process of getting this done : i obviously need to engage a solicitor on my side.
        Does the company need to hire a solicitor as well, a legal adviser on behalf of the 4 directors?
        Or would the directors simply need to sign a document?

        Comment


          #5
          I wonder if the concern of the downstairs lessee comes from the idea that you may at a latter date try and make it additional accommodation . To try and deal with that make it clear that the space will only be used for storage and that no windows will be placed in the roof and thus will be a term of the lease

          the loft needs to be demised to you for a market value which of course it does not have but it does have a value to you . Storage costs are around £1.50 per square foot per annum. So whatever the yearly rent that Produces should be at the top end of your negotiations but a figure of £200 per annum would seem fair in many cases. This capitalised at say 7% would give around £3000 as you are paying the legal costs perhaps £2000 should be paid to the company to either distribute as a dividend or to offset service charges

          alternative a ground rent on the loft space of £200 per annum

          Comment

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