property 41
Can the landlord of your commercial property insist on an unreasonable rent?
If you are the tenant of commercial property with less than 24 months until your lease ends then now is a good time to dig out your lease and check if it is protected by the Landlord and Tenant Act 1954 (L&T Act) writes Adam Schofield, senior surveyor, Vail Williams LLP
The L&T Act gives most tenants of commercial property a statutory right to renew their lease (or the prospect of receiving compensation if renewal of their lease is opposed). The L&T Act also ensures that the lease does not end automatically on the ”end” date written into the lease. It in fact continues after the “end“ date unless (or until) certain actions have taken place. The leases are commonly called “protected“ leases.
This protection can be removed by signing a contracting out agreement. Such leases are commonly called “unprotected” and
they really do end on the final day of the lease. There is no right to a new lease and no recourse to any third party, if you can’t amicably agree the terms to renew the lease.
The tenant of an L&T Act protected lease has a 3rd party (the Court) to fall back on if they don’t think they are getting a fair deal from their landlord. A tenant with an unprotected lease has no third party to fall back on and as such that tenant has a weaker negotiation position. The closer to the end of their lease the weaker their position becomes.
upon a tenant with high moving costs as an opportunity to obtain lease terms that exceed those they would get in the open market. In short the landlord can end up receiving more than is reasonable simply by acting unreasonably. If a tenant leaves it too late, because they don’t have enough time left to relocate by the end of the lease, then they may find that they have little choice but to accept the landlord’s demands.
So the answer to the initial question is this: Yes they can… if your lease is unprotected.
Therefore don’t delay discussing your lease renewal with your landlord.
But what does this ultimately mean for a tenant of an unprotected lease? It means that if the landlord feels so inclined they can demand whatever rent or lease terms they think they can get away with. They can easily end up getting more than a fair market rent and/or a lease that is longer than market norms.
As an example the landlord of an unprotected tenancy may look
For more information about Vail Williams LLP, visit the website.
Details: Adam Schofield 07887-830695
aschofield@vailwilliams.com www.vailwilliams.com
35% NOW LET 1,119 - 13,129 SQ FT
Brand New Warehouse/ Industrial Development
THE BUSINESS MAGAZINE – THAMES VALLEY – FEBRUARY 2015
www.businessmag.co.uk
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52