| Commercial Leases
Rent Reviews
These are usually incorporated into leases of commercial property, to provide for periodic adjustment of the rent to prevailing market level. Most are ‘upwards only’ (although this is somewhat controversial and may be attracting the attention of Government in due course).
Factors influencing current rental value include the size, nature and location of the property, and the specific lease terms including any restrictions on use.
We act for both landlord and tenants, and can take a case to an independent third party for resolution if the parties cannot agree.
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Lease Renewals
We act for both landlords and tenants in negotiations for renewal of leases of commercial premises when they come to an end.
Many commercial leases are covered by the provisions of Part II of the Landlord and Tenant Act 1954, which gives rights to a new lease to certain tenants in certain circumstances. Fixed procedures, with strict time limits, need to be complied with by both landlords and tenants – these are normally handled by solicitors for each side. Timely legal advice should be sought.
We can act for either party in negotiating ‘Heads of Terms’ for a new lease, based on prevailing market rents and existing lease terms.
Where necessary, we can act as ‘Expert Witness’ to the Court, who will decide on new lease terms under the Landlord and Tenant Act 1954 where the parties cannot agree.
Survey prior to lease
One situation where a survey is often neglected is where a tenant is taking a new lease, or an assignment of an existing lease, of commercial premises. |
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Such leases are often on ‘full repairing’ terms, which can oblige the tenant to put the property into a better condition than it was at the start of the lease. A Building Survey will help identify potential pitfalls. As an alternative, a Schedule of Condition might be prepared, which can be incorporated into a new lease to define and limit the standard to which the property must be maintained by the tenant. |
Dilapidations
This term principally covers proceedings whereby a landlord, by service of a ‘Schedule of Dilapidations’ seeks either to enforce a tenant’s repairing obligations under a lease of business premises, or claims compensation for lack of repair by the tenant at the end of the lease term.
There is considerable legislation by various Acts of Parliament, which can give some protection to the tenant in certain circumstances, both during and at the end of the lease. There is also a wealth of case law on the subject.
We can act for either landlord or tenant.
The obtaining of advice well before the end of a lease is particularly urged to both parties.
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