Feb. 14, 2019 597

Rent of real estate in Ukraine

If you wish to do business in Ukraine and decide to rent an office for this, here’s a few tips to help you make an informed decision.

If you intend to rent an office as an individual, you’re going to need legal grounds for staying in Ukraine - temporary or permanent residence permit; alternatively you can act as a business entity by registering a company in Ukraine (e.g. LLC) or become an entrepreneur. We will speak of this in detail in another video, so feel free to subscribe to our channel: https://www.youtube.com/channel/UCVe-xqdU8RiROeAW0IBiOuQ

If the lessor is an enterprise, you will need to open a bank account in Ukraine or deposit money in a bank for transfer to the landlord’s account.

As for the procedure for renting real estate, for non-residents it is no different than for residents and includes the following steps:

  • Prepare technical instructions for the realtor or lawyer, specifying what kind of premises you need (number of square meters, communications infrastructure, location, etc.)
  • Check the landlord: reputation, reviews, data available from public sources
  • Check the premises - whether they come with any restrictions or prohibitions and whether they actually belong to the landlord
  • Sign a lease agreement. If the rental period is 3+ years, the agreement must be notarized and the rental rights entered in the state registry.

What to look out for in the rental agreement

1.Terms of early termination

Avoid terms that allow the landlord to terminate the agreement unilaterally. Legislation already has a ground for this, which is valid regardless of what you put in the agreement, and that is failure to pay the rent for 3 consecutive months.

2. Fixed  price

For how long the rent fee remains unchanged, what the terms of payment are, under what conditions and procedure the parties can changed the rent fee. The fee is often tied to the currency exchange rate and it is important to establish how this rate is to be calculated.

3. Landlord’s visits

You can limit the number of visits by the landlord to, say, once a month, with prior notice of such visits.

4. Utilities and cleaning services

Whether such services are included in the rent fee, in full or in part. This is specified by the parties in the agreement. The standard in Ukraine is rent + electricity bills. Compensation for utilities may be provided under a separate agreement.

If the rented premises are located in a building, it is also necessary to specify how the share of utilities for specific rooms is going to be calculated.

5. Liability for damage

For instance, in case of damage to property. Landlords usually try to compensate for these risks through guarantee payments - you immediately pay the rent for the first and last month and these sums are refunded only after the transfer of the rented object in proper condition. Maintenance according to standard rules is paid for by the tenant, while major renovations are covered by the landlord. However, the procedure for determining these payments should also be specified in the rent agreement.

Now you are prepared for the pitfalls you could encounter in a rent agreement. In our turn, we can help you check the property and the landlord before the transaction and to follow the procedure correctly.