Lease Information

Introduction

We are very much looking forward to partnering together with you in God’s Kingdom and impacting this nation one house at a time. Alongside our draft lease template (provided by your Partnership Manager) this information will help you understand the lease agreement we enter into with our partners.  

This document explains some of the key areas of the lease but is not exhaustive. If you have any further questions please talk to your Partnership Manager and they will explain further to you.  

Please do remember that we are in this together and this is partnership in the truest sense of the word. Having read this document, if you have any clauses you would like us to explain further or adapt please speak to your Partnership Manager. There is no point you can’t raise. This is a very practical document that does not overshadow our heart to build thriving partnerships that serve the growth of the Kingdom of God.  

Dates & Length of Lease

1. Lease Start Date: at the top of page 1 and this is the day the property completes with the solicitors.
2. Rent Commencement Date: this is listed half-way down page 1 of the lease.  
3. Lease Payment: This is monthly and please see clause 1.2 to understand the timings of lease payments.
4. Length of Lease: We typically agree a 6 year term with our partners. If the lease is over 6 years further details need to be registered with the Land Registry which incurs additional legal fees. Of course our intention is for you to use this property indefinitely in the Kingdom of God, so a new lease would be signed every 6 years. Buying a property for another organisation to run supported housing is not a short term commitment and so 6 years has seemed appropriate to date.  

Repairs Responsibilities  

1. Clause 5 & 7 (and schedule 1): Repairs & Maintenance. The only reason these are costs to the partner is simply that they are costs eligible to be paid by Housing Benefit because you are contractually providing supported housing to your residents. That being said, if the partnership had a major repair, not covered under our Building Insurance (very unlikely) and you have not yet accrued sufficient Sinking Fund income from the rent sheet to cover the cost (from the repairs section of the rent sheet that GP compiles with you), GP will step in and be able to make payment for the partner. The partner would then reimburse GP this cost over whatever time period the partner is comfortable with. We are in this together, this is true partnership.  
2. Clause 6.1: a partner once asked “Why is the cyclical repairs period not 6 years like the lease is?” Answer: 5yrs is a typical cyclical period for decorating and not connected to length of lease.  
3. Clause 7.2: this work can be done by the partner if they so desire, rather than by a contractor.  
4. Clause 11: GP (the lessor) will respond very quickly  

Arrears

1. Clause 3: To date we have not had to apply interest to lease payment arrears. However it is good stewardship & industry standard to have this clause in case a partner decides to stop paying and communicating with us. Furthermore, we enable all partners to claim for 15% Voids and bad debt from Housing benefit so that when the partner achieves 85% occupancy they can afford 100% of the lease payments. When they exceed 85% occupancy this is surplus for the partner. Most landlords function on 95% occupancy.  
2. Clause 19. "'Interest Rate' means a yearly rate eight per cent above the base rate of the Bank of England" (Clause 19).  8% is a standard rate for defaulting and we have followed legal advice on this. Please remember banks are looking at our leases before they decide to lend Green Pastures any money. That said to date we have not applied any interest to lease payment arrears. We always work with the partner to address the issue. We are labouring together in the Kingdom rather than an us and them relationship.  

Notice to End the Lease

1. Clause 18. It is important that we have a year’s notice from you to end the lease. This is a generous length of time. Most leases require far longer than a year’s notice to exit the lease. We are making a very significant investment in a ministry we have not met before and have not worked with before. We want to release you to all your potential but we have to be responsible with the investment we have received at 5%. We never want the church to be burdened and if you are struggling a year’s notice allows you to look for another ministry in the area to take over the running of the property or in the worst case scenario GP to look at selling the property. You would carry on housing residents, paying GP the lease figure during these 12 months (it may well be though, that another church partner is found or the property is sold in less than 12 months).  

Rent Reviews & Lease Renewals

1. Clause 16 - Reviews of the lease amount on every third anniversary. This is a standard process on leases but we always consult with the partner first before implementing any rent increases in line with RPI. Our admin team will be in contact with you 3 months before the rent review date to check you are happy with the RPI increase and assist with a rent review with the council (if claiming EA).
2. Lease renewals - with regards to this we will contact you 3 months before the end of your lease to propose a new lease agreement for your feedback.  

Insurance

1. Clause 13 - Because you, the partner are supporting the residents the cost of building insurance is a cost that is eligible to be paid for by Housing Benefit. The building insurance is an expense that goes in the property rent sheet that is submitted to housing benefit. GP arranges the issuing and payment of the building insurance on the behalf of the partner to ensure this takes place straight after completion. The partner then reimburses GP (see clause 13.6.1) as this income comes in through the rent sheet from Housing Benefit. This expense is covered by Housing Benefit as it is an eligible cost under the Housing Act.  
2. Other Insurance:  Guidance on Insurance informs you what insurance you should take out.  

Other adjustments to the lease

1. Clause 12.1 “supported housing services” This text can be adjusted to suit the project in question if you are running a project that is slightly different from supported housing.. Simply speak to your GP Partnership Manager about this.  
2. Clause 20 is typically deleted as usually it is not needed

Lease Completion

Signing the Lease Electronically

1. It is likely that details of the signatories of the lease were provided on the relevant NPF, however if this isn't the case, please provide the following information:

For Companies or Incorporated Charities

1. The full name and email address of two directors (or a director and secretary); OR
2. The full name and email address of one director and of a witness* for that directors signature

For Charities

1. The full name and email address of two trustees and a witness* for each of the trustees signatures.  

Who can be a witness?  

For best practice a witnesses should be:

• over 18 years old;
• sufficient maturity for their evidence to be relied on;  
• 'of sound mind'; and
• not have any commercial or financial interest in the deed.

It is however a legal requirement that the witness not be a party to the deed (they cannot be a trustee of the charity)

• The lease will be issued electronically to the directors/trustees by email via E-Sign. The lease can be signed electronically. Once all parties have signed, you will receive a final copy of the lease.  
• Please execute the singing of the lease within 2 weeks of TODAY. This is vital for the process of providing evidence to HB of your supported housing as previously shared by your PM.  

Payments to Green Pastures

Setting up standing orders & Payment References

1. Please set up one monthly standing order for the following items from the rent sheet:
   a. Lease
   b. Building Insurance
   c. Professional Fees
   d. any Upgrades or other eligible items due to GP listed in the rent sheet that were paid for by GP.
2. Please give the standing order payment a reference that is the first 6 letters of the street name of the property. Then our accounts team can easily identify what property the payment is for  
3. Please make sure there are separate standing orders for separate properties.  

Bank Details for Standing Orders

• Account Name: Green Pastures CBS Limited
• Account Number: 20364068  
• Sort Code: 30-97-88