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Don’t let RAAC crumble your business

It is fair to say the media have enjoyed themselves recently with RAAC; a phrase that may find itself in the dictionary in due course.

However, we do find ourselves in some agreement with the media in that a potential problem does exist, especially as the Government brings in the Building Regulations (higher risk building procedures) (England) 2023 and the Building Regulations etc (amendment) (England) Regulations 2023, effective from 17 August 2023.

The new regulations refer to a building being of high risk if it is a block of flats, a hospital or care home more than 18 metres or more than seven stories high. The issue could be where you own the freehold of such a building where tenants are in situ. Who covers the remedial costs? Can these be passed on?

Another risk can be the closure of the building while an inspection takes place and, where necessary, appropriate remedial action is taken.  This could mean your business having to relocate or, as a landlord, there may be responsibilities for you to secure alternative accommodation for your tenants. Again, there may well be costs involved.

All the above, creates a potential drain on funds and may, in some circumstances, mean a default against secured lending.  In this situation a secured lender may have the power to appoint receivers under the Law of Property Act.  Some lenders appoint a licensed insolvency practitioner as LPA Receiver to oversee and ensure the obligations under the regulations are met and this approach could become an increasing practice among lenders.

To try and prevent secured creditor action, PBC would suggest those facing financial issues, because of owning a high-risk building, should first check to see if they are covered for business interruption insurance.  Alternatively, speak to your lender(s) to explore ways of managing the situation.  If all fails, then consider taking advice to protect you and your business.

If you require any advice or assistance on any insolvency-related issue, then please contact PBC Business Recovery & Insolvency to discuss and advise on your situation on 01604 212150 (Northampton), 01908 488653 (Milton Keynes) or email to  Alternatively, visit for further information.