Hi-tech Spraying of boats

[balwoges]

I have just refused a would be tenant, his business is the spraying of boats. I am aware of the dangers and the need for council approval and would normally refuse such an application ... he assured me he uses a hi-tech method of spraying in a nylon tent. I think there would still be problems re fumes and he would have to install an extractor fan etc. also would negate my insurance.

But ... this close to Christmas am surprised to have had 3 enquiries in the last 10 days, so the economy cant be all bad

 

[pinkboy]

I have just refused a would be tenant, his business is the spraying of boats. I am aware of the dangers and the need for council approval and would normally refuse such an application ... he assured me he uses a hi-tech method of spraying in a nylon tent. I think there would still be problems re fumes and he would have to install an extractor fan etc. also would negate my insurance.

But ... this close to Christmas am surprised to have had 3 enquiries in the last 10 days, so the economy cant be all bad

Perhaps if he did go through all the right channels and has all the right gear you could potentially charge him a higher rent, and also potentially keep a long term tenant? Your insurance wouldn't be compromised if his insurance covered for overspray etc.

'High Tech' and 'nylon tent' suggest to me he is spraying a 100% solids, solventless material.

Is there a downturn in the economy due to mining? Im not sure as I can hardly scratch myself and cant hardly post on SS Im that flat!

pinkboy

 

[Scott No Mates]

Does your lease not provide that the tenant pays any increase in the premium attributed to their usage?

Has the nylon tent been approved by workcover?
Is it flammable?
What dust and particulate control measures will the tenant put in place?
Run this past your insurer before dismissing the application.

(it's not a car/boat rebirthing operation is it?)

 

[balwoges]

I appreciate the good advice, if the tenant gets back to me intend to grill him on his operation and make sure I am covered.

(it's not a car/boat rebirthing operation is it?) Alarm bells rang last week when another would-be tenant asked about space for repairs to his 3/4 personal vehicles !!! you have to be so careful who you take on as tenants.

 

[balwoges]

An update on my would-be tenant [now no way] re spraying of boats in nylon tent. My insurance broker said he would have to comply with all regulations that includes a fully enclosed spray booth etc. etc and obtain a DA from council and my insurance would increased [a lot].

 

[pinkboy]

An update on my would-be tenant [now no way] re spraying of boats in nylon tent. My insurance broker said he would have to comply with all regulations that includes a fully enclosed spray booth etc. etc and obtain a DA from council and my insurance would increased [a lot].

Not all my spray booths are fully enclosed?

Why not charge him the insurance premium increase in his lease? Don't you charge outgoings?

What DA would he need to obtain? Is he only specifically coating? I wouldn't think he would need to intensify the use of the space just spraying.


pinkboy

 

[balwoges]

I will take the advice of the business consultant from the insurance company I use ... a DA was a requirement of the council when another tenant made the same enquiry some years ago.

 

[pinkboy]

I will take the advice of the business consultant from the insurance company I use ... a DA was a requirement of the council when another tenant made the same enquiry some years ago.

You're making it out like its going to be your problem.

You could have a tenant in and all you have to say is 'Sure, get the DA, make a complying booth, pay my increased premium and here's the big fat lease with a healthy margin on top to cover me for my troubles'.

You would be flat out signing a couple of documents just as the owners of my workshop did.

You can take the advice of one insurance broker bloke, or you could take the blinkers off and see that it can be made to work if you want it to.


pinkboy

 

[Scott No Mates]

I met up with a prospect earlier this week who was a major supplier of automotive paints and glass paint. He said that his insurer (Vero) performs 2 annual inspections of his premises to ensure that their risk is adequately covered. Ie: extinguishers/fire suppression systems, exit/emergency lighting, ventillation, respirators, mixing areas, QA systems, WHS Systems etc must all be up to speed.

 

[balwoges]

I think my would-be tenant was in out of his depth and didn't realise the implications of what would be involved in starting a business such as his. My business premises are small industrial units and I deal with small business people. Would be a different matter if I had huge spaces to fill and dealt with big business.

 

[barra]

What exactly are the negative implications to signing a lease that protects you against damages to your premises and then letting the tenant do whatever they want?

Have the lease state it's being rented for storage regardless of what the tenants intentions are?

I have no experience with commercial property so input is appreciated.

The only risk I see is the tenant breaking the lease if they get an inspection from there businesses authorities (work cover etc) and get shut down.

I think the risk of this would be hard to manage with small businesses unless you want to research every different industry and get real world knowledge of how heavily enforced various regulations and legislation is in different fields.

 

[balwoges]

First thing I ask a would be tenant is 'how do you plan on using the unit?' I am bound by council regulations as to its use. I also have 12 tenants who need to be considered.

Why on earth would you not care what use your property is being used for? just imagine someone using it for the production of amphetamines or growing weed or using it for car re birthing - the police would soon be on to it and be around to investigate and before you know it breaking down roller doors with axes etc.

There is also your insurance to worry, about - my tenant application form includes the question of use of the unit, and the lease specifies the use of the unit.

I also visit regularly to see what's going on

 

[barra]

I think at some point who cares.

Is your insurance guy an expert in the boat industry? Does he know if the possibly hi tech, new and perhaps perfectly legal methods your potential tenant plans to use are breaching use regulations or not? While you sit not collecting rent.

Of course you want the security of knowing your premises is fully insured but what's stopping me telling you what you want to hear, and then using the premises outside of its purpose in a manner that your personal inspection can't tell and in the event of an insurance claim you being denied?

It's fine to be picky if you have 13 applicants to choose from.

My frustration re your situation comes from the other side of the fence.

People like you, taking input from people like an insurance broker on something they perhaps have zero knowledge about.

Have you done any research or requested the applicant provide any council documents or approvals regarding the use they plan for your unit?

Also worth noting is some of the absolute rubbish information I have been told by insurance people (even state managers etc) over the years that I'm sure when push came to shove I'd be left high and dry.

 

[balwoges]

Sounds to me you have no respect for other peoples rights or their property.

 

[barra]

Sounds like your a control freak who would take advice from any un informed clown and let your emotions blur your judgement.

Good talk.

 

[alicudi]

Hi

From a landlord's perspective it is always best to know of the type of business the tenant is operating and the repercussions of said business.

In this instance it is from hi tech spraying of boats, but I have seen a large number of issues created when the landlord is not fully aware of the issues with tenants operating certain types of businesses on their premises and what it can mean long term for the landlord.

For instance, I know of a retail premises that declined a radiology due to the requirement of sealing the area with lead steel and if the business operated for a long time it could have given contamination issues to the property when the tenant vacated.

I am also aware of another case where a commercial laundry service "Spotless" occupied a property in Brunswick Victoria for many years, it was eventually turned into apartments and only after all the money had been spent on the property was it then deemed contaminated....somebody lost millions in this case.

So it is not a matter of over-controlling, it is just a matter of been aware, mitigating and controlling your exposure to risk.

Regards,

alicudi

 

[balwoges]

I learnt my lesson several years ago, cost me a lot of money. At the moment I have 11 tenants who would be the greatest bunch of tenants I have ever had, all of them get along and help one another when needed, so I must be doing something right

 

[barra]

Thanks for the insight alicudi.

Halogens, care to be civil and share your your previous incident? I would appreciate as I wasn't trying to stir ****, just share another perspective...

 

[Scott No Mates]

Insurers, depending upon how they manage their books, have a wealth of resources at their fingertips and will have a deep understanding of risk as it applies to a particular usage.

I have some insurers who will inspect annually/more often depending upon the type of tenancy eg. if they utilise flammable chemicals or dry chemicals which may give rise to explosions. They will check that the tenant has all MSDS, fire suppression systems, exit/emergency lighting, procedures manuals, SWMS, is complying with any WHS requirements, industry codes of practice etc.

As a landlord/REA I don't necessarily need to understand the ins and outs of every tenant's operation but I do need to know that they are complying with all the relevant legislation and not compromising my property.

 

[balwoges]

I think Barra is seeing my choice of tenants as playing God. I do, but it is a necessity when managing my property which consists of 12 multi tenanted small industrial units with only 12 car spaces.

Banned are
1. Commercial motor vehicle repairs, reason, not enough parking for their customers cars to be left on property waiting to be picked up or repaired. Tenants complain when they cant use their car space. Same goes for commercial boat repairs.

2. Car detailers [2], after assuring me they would use the car wash up the street for washing, they washed their cars on the common property despite me explaining the water runs directly into the river and and I would be heavily fined if they were caught.

Another would-be tenant wanted to use a unit for a dance school, they intended to built a wooden floor over the concrete. Children roaming where trucks are coming in and out!

Another would-be tenant approached me last week wanting to use a unit for a craft & art centre, couldn't see this working with my present mix of tenants.