Lease guarantees

The Landlord’s key concern in letting its property will be the ability of the tenant to pay the rent and comply with its obligations under the lease.

Dentists who take leases of dental premises will usually be asked by their landlord to demonstrate their ability to meet the commitments under the lease. Landlords will often ask to see references from a bank or accountant or a trading reference together with usually three years’ trading or company accounts to assess the position.

Leases are often taken in the name of a dentist’s company. This has the advantage of ensuring liability under the lease will stay with the company and not the dentist personally which could risk his personal assets if he breaches the lease.

If the tenant company is new with no trading history or assets, the landlord will often ask the dentist for added security. This can be a guarantee from a larger more established parent company or, where the dental corporate is a small organisation, from one or more directors of that company.