TM44 and Dilapidations: The AC Compliance Risk Tenants Miss

When a commercial tenant prepares to leave a property, most of the attention goes to visible condition. Walls, floors, ceilings, partitions, decorations, doors, lighting, signage, repairs, cleaning and reinstatement usually dominate the conversation. Surveyors review the lease, landlords prepare schedules of dilapidations, tenants check their obligations, and managing agents coordinate access, keys and handover.

But there is one issue that is often missed until late in the process: air conditioning compliance.

For many commercial buildings in the UK, air conditioning is not only a comfort feature. If the combined effective rated output of the air conditioning system is over 12kW, a TM44 air conditioning inspection may be required. This is a formal energy efficiency inspection carried out by an accredited assessor. It is not the same as normal AC servicing. It is not replaced by a maintenance visit. It is not automatically covered because an engineer has cleaned filters or completed F-Gas checks.

This matters during lease exit, lease assignment and dilapidations because commercial tenants often install, alter, extend or inherit air conditioning systems during occupation. By the time they leave, nobody may be completely sure who owns the system, who controls it, when it was last inspected, whether it is over the threshold, or whether the TM44 report still matches the current installation.

A tenant may leave the office clean, repaired and decorated, but still leave behind an unclear air conditioning compliance position.

That is the hidden risk.

Why TM44 Matters During Dilapidations

Dilapidations normally focus on the tenant’s lease obligations at the end of the term. The landlord may expect the tenant to repair damage, remove alterations, reinstate layout changes, replace missing items, service systems, or hand the property back in a required condition.

Air conditioning can become part of that dispute because it often sits between building services, tenant improvements and statutory compliance.

The issue is rarely simple. In some buildings, the landlord provides the base cooling system. In others, the tenant installs its own split systems or comfort cooling. In multi-let buildings, one outdoor condenser may serve several indoor units. In older properties, units may have been added gradually over several years. In fitted offices, the AC may have been inherited from a previous occupier. In retail, clinic, hospitality and office spaces, extra cooling may have been added for server cupboards, treatment rooms, meeting rooms, shop floors or customer areas.

At lease exit, these questions become important:

• Who installed the air conditioning units?
• Are they landlord’s fixtures or tenant’s additions?
• Are the systems still operational?
• Have any units been removed, isolated or left redundant?
• Is there an up-to-date asset list?
• Does the combined cooling capacity exceed 12kW?
• Is there a valid TM44 inspection report?
• Does the report reflect the current system?
• Has the report been lodged correctly?
• Who must provide compliance evidence before handover?

If these questions cannot be answered quickly, the tenant’s exit can become more complicated than expected.

For a general overview of when TM44 applies, readers can visit TM44.uk’s air conditioning inspection page at https://tm44.uk/tm44-air-conditioning-inspections/. For a more detailed explanation of legal requirements, the page at https://tm44.uk/tm44-inspection-requirements-uk/ is also a useful internal link.

The Commercial Lease Problem: AC Is Often Changed During Occupation

Commercial tenants rarely occupy a property exactly as they found it. Businesses adapt premises to match how they operate.

A tenant may add:

• Extra cooling for meeting rooms
• Wall-mounted split units for offices
• Cassette units for open-plan areas
• Cooling for IT rooms or server cupboards
• Supplementary AC for reception areas
• Comfort cooling for treatment rooms
• Units for training rooms or staff areas
• Additional condensers after business expansion

These changes may be perfectly reasonable operationally, but they can create a compliance gap if nobody updates the building’s AC records.

The tenant may think the contractor handled everything. The contractor may only have installed and commissioned the unit. The managing agent may have maintenance records but not a full TM44 position. The landlord may assume the tenant is responsible because the tenant installed the equipment. The tenant may assume the landlord is responsible because the system is attached to the building.

This is how TM44 becomes missed.

During the lease term, the issue may remain invisible. The system works. Staff are comfortable. Engineers attend service visits. No one asks for the TM44 report. But when the lease is assigned, surrendered or terminated, the compliance file comes under pressure.

At that point, missing information becomes a problem.

TM44 Is Not the Same as AC Servicing

This is one of the most important points for commercial tenants.

A standard air conditioning service is not a TM44 inspection.

AC servicing usually focuses on keeping equipment operational. Engineers may clean filters, check refrigerant pressures, inspect drains, test controls, check operation, identify faults and complete maintenance paperwork.

TM44 is different. It is an air conditioning energy assessment. It reviews how the system is operating from an efficiency and compliance perspective. It considers system size, controls, operation, maintenance condition and recommendations for improvement.

A building can have regular AC maintenance but still have no valid TM44 inspection report.

This matters during dilapidations because a tenant may provide maintenance invoices and believe they have satisfied their AC obligations. But if the building or system falls within TM44 scope, the landlord, surveyor or managing agent may still ask for the formal TM44 report.

The two documents do different jobs.

For readers comparing AC compliance and other maintenance-related obligations, TM44.uk’s F-Gas and compliance page at https://tm44.uk/f-gas-leak-testing-compliance-checks/ can support the wider context.

Lease Assignment: What Incoming Tenants Should Ask

Lease assignments can create hidden compliance risk because a new tenant may take over a property with existing air conditioning equipment without fully understanding the history.

The outgoing tenant may have installed units. The incoming tenant may inherit them. The landlord may approve the assignment but not investigate the AC position in detail. The managing agent may only hold partial records.

Before accepting responsibility for a commercial lease, an incoming tenant should ask:

• Is there air conditioning in the premises?
• How many indoor and outdoor units are installed?
• What is the total cooling capacity?
• Are the units landlord-owned or tenant-installed?
• Are any units shared with other occupiers?
• Is there a valid TM44 report?
• When does the TM44 report expire?
• Was the report lodged on the official register?
• Are there outstanding recommendations?
• Are there maintenance or F-Gas records?
• Will the tenant be responsible for future TM44 inspections?

This is not just paperwork. It can affect future cost, compliance responsibility and lease exit obligations.

If an incoming tenant signs without checking, they may later discover they have inherited an overdue TM44 issue or incomplete AC records. That can create avoidable cost and confusion.

TM44.uk can help incoming tenants and managing agents check the AC compliance position before assignment. A simple starting point is to request a quote or compliance review through https://tm44.uk/get-quote/.

Lease Exit: What Outgoing Tenants Should Check

Outgoing tenants should not wait until the final week of occupation to deal with AC paperwork.

If the tenant installed, altered or controlled air conditioning systems, they should check the compliance position early. This is especially important where the system may exceed the 12kW threshold or where there is no clear previous TM44 report.

Before lease exit, outgoing tenants should prepare:

• AC asset list
• Indoor and outdoor unit counts
• Make and model numbers
• Cooling capacity information
• Installation records
• Maintenance history
• F-Gas records where applicable
• Any previous TM44 report
• Evidence of decommissioned or removed units
• Confirmation of landlord-approved alterations
• Any licence to alter documents
• Handover notes for the managing agent or landlord

If no TM44 inspection has been completed and the system appears to fall within scope, the tenant should raise the issue before it becomes part of a dispute.

A proactive approach is much stronger than leaving the landlord to discover the gap after handover.

For businesses without a full asset list, TM44.uk has a helpful article at https://tm44.uk/news-blog/no-asset-list-tm44-inspection/ which explains what can be done when AC information is incomplete.

Landlord vs Tenant: Who Is Responsible?

Responsibility for TM44 is one of the main grey areas in commercial property.

In broad terms, responsibility usually sits with the person or organisation that controls the operation of the air conditioning system. In practice, this can be affected by the lease, maintenance arrangements, ownership of plant, service charge structure, tenant alterations and how the system is used.

Possible responsibility scenarios include:

• Landlord controls central AC plant for a multi-let building
• Tenant controls its own split systems inside a demised unit
• Managing agent coordinates compliance on behalf of the landlord
• Tenant installed supplementary units and maintains them directly
• Multiple occupiers use systems connected to shared external condensers
• The previous tenant installed AC and the incoming tenant inherited it
• The lease makes the tenant responsible for statutory compliance within the premises

This is why TM44 should not be treated as a casual admin item. It should be reviewed alongside the lease, maintenance records and building services information.

If the parties are unsure, the best approach is not to argue blindly. The first practical step is to identify the equipment, confirm the capacity, check whether a valid report exists, and clarify who controls the system.

TM44.uk’s responsibility guide at https://tm44.uk/news-blog/tm44-responsibility-guide/ is a useful internal link for this part of the topic.

How Dilapidations Surveyors Can Use TM44 Evidence

Dilapidations surveyors are not TM44 assessors, but they may need to consider whether the air conditioning compliance file is complete as part of lease exit or reinstatement discussions.

TM44 evidence can help clarify:

• Whether the AC system was inspected
• Whether the report reflects the current layout
• Whether units were added or removed
• Whether there are obvious operational concerns
• Whether the system has documented recommendations
• Whether compliance records have been handed over
• Whether the outgoing tenant has left incomplete information

In a dispute, clear records reduce uncertainty.

Without records, the landlord may argue that the tenant has failed to provide proper evidence. The tenant may argue that the landlord controlled the system. The managing agent may have to investigate history across several contractors and occupiers.

That is expensive, slow and avoidable.

A TM44 inspection will not replace legal advice or a full dilapidations assessment, but it can provide important technical compliance evidence around the air conditioning system.

Case Study Example 1: Tenant-Installed Split Systems Left Behind

A marketing agency occupies a 350 m² office for seven years. At the start of the lease, the space has basic landlord-provided comfort cooling. After two years, the tenant adds extra split units for a boardroom, design studio and small server area.

The tenant uses a local AC contractor for installation and servicing. The systems work well, and no one raises TM44 during the lease.

At lease exit, the landlord’s surveyor reviews the premises and asks for AC records. The tenant provides service invoices but no TM44 report. The landlord then asks whether the added units pushed the total cooling capacity over the 12kW threshold.

The tenant cannot confirm because there is no updated asset list.

The result:

• The landlord delays final handover review
• The tenant has to contact old contractors for model numbers
• The managing agent has to check whether a report exists
• The surveyor adds the issue to the dilapidations discussion
• Both sides lose time over a problem that could have been checked earlier

Lesson: if a tenant installs additional AC during the lease, the TM44 position should be reviewed before lease exit, not after the landlord asks.

Case Study Example 2: Incoming Tenant Inherits an Overdue Compliance Issue

A professional services company takes an assignment of an existing office lease. The space is already fitted, furnished and cooled. The outgoing tenant leaves behind desks, meeting rooms, cabling and several AC units.

The incoming tenant focuses on rent, service charge, lease term, fit-out condition and occupation date. The AC appears to work, so nobody requests a TM44 report before completion.

Six months later, the tenant’s internal compliance team asks for building safety and energy documentation. The managing agent confirms there is no current TM44 report for the tenant-controlled systems. The tenant then discovers that the combined cooling capacity appears to exceed 12kW.

The result:

• The incoming tenant has to arrange a TM44 inspection
• The cost was not budgeted at assignment stage
• Responsibility is unclear because the units were inherited
• The landlord argues the tenant controls the system
• The tenant realises the issue should have been checked before assignment

Lesson: incoming tenants should ask for TM44 evidence before taking over premises with existing air conditioning.

Case Study Example 3: Landlord Relets a Unit After Tenant Exit

A landlord receives back a commercial unit after a tenant leaves. The unit has multiple AC systems, some installed by the tenant and some inherited from previous occupiers. The space is then marketed as “air conditioned” to attract a new tenant.

During negotiations, the incoming tenant’s adviser asks for the TM44 certificate. The landlord cannot find one. The managing agent has maintenance reports but no formal TM44 inspection record. The AC contractor has serviced the units but was not asked to arrange TM44 compliance.

The result:

• The new tenant requests clarification before signing
• The landlord has to arrange a quick AC compliance review
• The letting process slows down
• The managing agent has to reconstruct the asset list
• The landlord loses time during a live transaction

Lesson: landlords should check TM44 immediately after tenant exit, especially before marketing an air-conditioned unit.

TM44.uk supports landlords and managing agents who need fast checks before reletting or handover. Where timing is urgent, the emergency service page at https://tm44.uk/emergency-tm44-24-48-hour-service/ is relevant.

Common TM44 Gaps Found During Lease Events

Commercial lease events often reveal the same problems again and again.

Typical gaps include:

• No TM44 report despite AC over 12kW
• Expired TM44 report
• Old report that does not match current layout
• Missing model numbers
• Missing cooling capacity data
• Tenant-installed units not included in landlord records
• Decommissioned units still appearing on old asset lists
• Outdoor condensers with unclear ownership
• Shared systems with unclear responsibility
• Maintenance records confused with TM44 compliance
• No evidence of government lodgement
• No renewal reminder system
• No handover pack for the incoming party

These gaps are not always intentional. Often they happen because air conditioning has been changed gradually over time and nobody has kept the compliance file updated.

That is why TM44 should be checked as part of any serious lease exit or assignment process.

What Should Be in an AC Compliance Handover Pack?

For lease exit, lease assignment or dilapidations, an organised AC handover pack can prevent disputes.

A useful handover pack should include:

• Current AC asset list
• Indoor and outdoor unit locations
• Make and model numbers
• Cooling capacities
• Maintenance records
• F-Gas records where relevant
• Commissioning certificates for new installations
• Decommissioning evidence for removed systems
• Any licences to alter linked to AC works
• Current TM44 report if required
• TM44 certificate or lodgement confirmation
• Details of outstanding recommendations
• Contact details for maintenance provider
• Access notes for roofs, plant areas or ceiling voids

This level of organisation makes the property easier to manage, easier to relet and easier to defend during compliance checks.

TM44.uk also has a dedicated page on TM44 inspection evidence at https://tm44.uk/tm44-inspection-evidence/, which is a strong supporting link for readers building a compliance file.

Why Managing Agents Should Check TM44 Before Handover

Managing agents often become responsible for resolving problems that were created by others. A tenant may have installed AC years earlier. A landlord may not know the technical details. A contractor may have changed systems but not updated central records.

When a lease ends, the managing agent may be asked to provide answers quickly.

A proactive managing agent should check:

• Which AC systems serve the unit
• Whether systems are landlord or tenant-controlled
• Whether a valid TM44 report exists
• Whether the report is still in date
• Whether the asset list is accurate
• Whether the incoming tenant needs compliance evidence
• Whether the landlord should arrange inspection before reletting

This is especially important for property portfolios. A single missing report may be manageable. A portfolio with multiple tenant changes, mixed AC systems and inconsistent records can quickly become difficult.

TM44.uk supports multi-site and portfolio clients through https://tm44.uk/tm44-portfolio-management/. This is relevant for managing agents handling several commercial buildings or units across the UK.

Why Solicitors and Surveyors Should Ask About TM44

Commercial property solicitors and surveyors do not need to become AC specialists, but they should know when to ask the question.

TM44 should be considered where:

• The premises are air conditioned
• The lease refers to plant, machinery or building services
• The tenant has installed or altered AC
• There is a lease assignment
• There is a surrender or end-of-lease handover
• There is a schedule of dilapidations
• The property is being sold or relet
• The building has multi-let or shared systems
• Compliance documentation is being requested

One simple question can avoid later problems:

“Is there a valid TM44 air conditioning inspection report for the current system, if the system is within scope?”

If the answer is unclear, the client should be advised to check before completion, handover or settlement.

TM44 and the 12kW Trap During Lease Exit

The 12kW threshold is where many commercial tenants get caught.

They may look at one indoor unit and assume the system is too small to matter. But TM44 is based on the effective rated output of the air conditioning system. Multiple smaller units can combine to exceed the threshold.

For example:

• Three or four split systems in one office may exceed 12kW
• A retail unit with several cassette units may exceed 12kW
• A clinic with treatment rooms and reception cooling may exceed 12kW
• A fitted office with meeting rooms and server cooling may exceed 12kW
• A tenant adding extra systems over time may cross the threshold without noticing

This is why the question should not be “Is each unit over 12kW?”

The better question is:

“What is the total effective rated cooling output of the air conditioning system serving the premises?”

TM44.uk provides a useful tool for checking the threshold at https://tm44.uk/tm44-kw-checker/.

How TM44 Can Support Better Lease Negotiations

Clear TM44 evidence can make lease negotiations smoother.

For landlords, it shows that the building is being managed properly and that AC compliance is not being hidden. For tenants, it helps clarify whether they are taking on a current obligation, an overdue issue or a future renewal cost. For managing agents, it reduces confusion during handover.

A valid and accurate TM44 report can support:

• Lease assignment due diligence
• New tenant onboarding
• End-of-lease handover
• Dilapidations negotiations
• Landlord compliance files
• Managing agent records
• Energy management planning
• Portfolio compliance tracking

The inspection also provides recommendations that may help reduce energy waste and improve system operation. This can be useful where the incoming tenant is concerned about running costs.

For readers who want to understand the report itself, TM44.uk’s report page at https://tm44.uk/tm44-report/ explains what the document is and why it matters.

How TM44.uk Helps Landlords, Tenants and Managing Agents

TM44.uk provides UK-wide support for commercial air conditioning inspections, TM44 certification and government lodgement.

We help clients who are dealing with:

• Lease exits
• Lease assignments
• Dilapidations
• Tenant handovers
• Reletting air-conditioned spaces
• Missing AC records
• No previous TM44 report
• Expired TM44 certificates
• Multi-let building responsibility issues
• Tenant-installed air conditioning
• Commercial property transactions
• Urgent compliance deadlines

Our process is designed to be practical. We understand that during lease events, information is not always perfect. The asset list may be incomplete. Model numbers may be hard to access. Some units may be above ceilings or on rooftops. The landlord and tenant may not agree who holds the records.

We help move the issue forward by identifying what information is needed, arranging the inspection where required, coordinating with site contacts and supporting the compliance process through to report and lodgement.

To start, send the property address, AC details and any available asset list through https://tm44.uk/get-quote/.

Practical Checklist Before Lease Exit or Assignment

Before lease exit, lease assignment or dilapidations negotiation, use this TM44 checklist:

• Confirm whether the property has fixed air conditioning
• Count the indoor and outdoor units
• Identify who installed the systems
• Check whether the units are landlord-owned or tenant-installed
• Confirm whether systems are shared or demised
• Find the make and model numbers
• Estimate or confirm the total cooling output
• Check if the system is over 12kW
• Ask whether a TM44 report exists
• Check the report date and expiry
• Confirm whether the report matches the current system
• Check whether the report was lodged
• Gather maintenance and F-Gas records
• Confirm who is responsible under the lease
• Arrange a TM44 inspection if required

This checklist should be used early, not at the final handover meeting.

Final Word: Do Not Let AC Compliance Become a Lease Exit Problem

Commercial tenants usually want a clean exit. Landlords want the property returned in a lettable and compliant condition. Managing agents want complete records. Surveyors want clarity. Incoming tenants want to know what they are taking on.

TM44 can affect all of these parties.

The risk is that air conditioning compliance is often invisible until someone asks for evidence. By then, the lease event may already be under pressure.

If your commercial premises are air conditioned and you are dealing with lease exit, assignment, surrender, reletting or dilapidations, check the TM44 position early. Do not assume maintenance records are enough. Do not assume an old report still reflects the current system. Do not assume responsibility is obvious without checking the lease and equipment control.

TM44.uk can help landlords, tenants, managing agents and commercial property professionals clarify the position quickly and arrange accredited TM44 inspections where required.

To request support, visit https://tm44.uk/get-quote/ and send the property details, AC information and any deadline linked to the lease event.