Percy Hughes & Roberts Solicitors

As a Tenant you may think that when the time comes to renew your commercial lease it should be a piece of cake. If you decide to do it without the advice of a commercial property solicitor I would warn you to be prepared for the indigestion!

Under the security of tenure provisions set out in the Landlord and Tenant Act 1954 you should be offered a new lease from your Landlord on substantially the same terms as your existing lease (provided that your existing lease was not contracted out of these provisions). The only differences in your new commercial lease should be the level of rent and some ‘modernisation’ of terms. Unfortunately, this isn’t always the case.

In many cases Tenants agree the new terms with their Landlord without any dispute or disagreement and then happily wait for the Landlord’s solicitor to send them the new lease for signature. Naively many Tenants think it is not necessary to instruct their own solicitor to check it before they sign.

The fact is the Landlord’s solicitor prepares the lease in the best interests of their  client the Landlord which in most cases means it will include not only more modern terms but more onerous terms for the Tenant. The term ‘modernisation’ is often is often used as cover  to enable  the landlord to sneak in terms more favourable to himself.

I recently received a renewal lease to approve for a Tenant where the Landlord’s solicitor had inserted amongst other new terms an upward only rent review where there had not been one before; very specific and detailed redecoration obligations on the tenant whereas the existing lease had omitted redecoration entirely and interest payments where there had been none before.

Not only does your new commercial lease need to be fully checked but it also needs to be compared with your existing lease to identify these potentially new onerous terms. Therefore, I cannot stress enough the importance of seeking legal advice every time you renew a commercial lease.

You don’t want to suffer a nasty case of indigestion when the new terms come back to bite you!