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Formalising the co-location

To ensure both the Crown and the lead agency are protected against any commercial risk, the agencies involved should formalise the intent and responsibilities of the co-location before making any leasing decisions.

The Memorandum of Understanding

The Memorandum of Understanding (MoU) is an initial agreement between all the co-location parties. It’s designed to document the intent to lease and outlines:

  • project parameters, including:
    • expected budgets for capital expenditure
    • operational expenditure
    • lease term expectations, and
    • high level space requirements
  • decision-making processes for standard project decisions, such as design decisions, changes to the project parameters, and operating decisions
  • the obligations of the lead agency and participating agencies throughout the project
  • exit provisions, in case an agency needs to leave the project (subject to obligations being met).

The MoU is put in place once the project is confirmed, but ideally before agencies go to market to find a site. It ends when the co-location agreement is signed, or the project is dissolved without entering into a lease.

The co-location agreement

The co-location agreement is essentially a lease agreement between all parties. It’s put in place to coincide with rent starting and ends at the same time as the lease ends.

The co-location agreement mirrors the lease’s commercial terms, and documents:

  • cost allocations
  • obligations if an agency needs to exit the co-location
  • processes for new parties to join the co-location
  • mechanisms for making decisions during the life of the tenancy
  • health and safety responsibilities.

The lease will be attached to the co-location agreement. However, the agreement does highlight areas where there may be limitations placed on occupants, such as building use or activities that need the landlord’s consent.

The commercial terms can be tailored to accommodate more temporary participating agencies. We’d advise that you ensure all existing participating agencies agree to any agency joining the co-location on different terms.

Document templates

Mandated agencies can access the MoU and co-location agreement templates by emailing us.

The templates:

  • are drafted on the basis that all agencies are entering into a partnership agreement for the fitting out of the premises and the full term of the tenancy
  • are considered living documents and will be refined over time to reflect feedback and learnings from previous co-locations
  • aim to set out, to the greatest extent possible, a neutral position for both parties.

GPG is party to both agreements.

We expect that:

  • both an MoU and a co-location agreement will be signed by those with appropriate delegated authority within your agency (usually Tier 1 or 2)
  • agencies have the necessary approvals to meet the commercial and financial obligations set out in the agreements
  • GPG is included in key communications regarding the development of the documents and can be more involved in facilitating the agreement development if required
  • the templates will be customised for the specific circumstances of the co-location.

How we can help

Our legal team can help with any queries you have around customising the documents, and we can also provide a legal review of completed agreements.

Contact us