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Tel: 07933 114108

Email: barry@voyseyltd.com

licensed, leisure and retail property services

Lease Renewal

 

Tenants of a commercial property are generally able to renew their lease when the existing lease comes to the end and such proceedings are regulated by the provisions of the Landlord & Tenant Acts.  However, in some cases this right does not exist as the parties have opted out of the security of ternure provisions of the L&T Act; or the landlord may, relying on a number of permitted grounds, have a case to oppose the renewal.  Within the public house, restaurant and other licensed/leisure property leases are generall of longer length and occasions for lease renewal have been fewer than say in the retail sector.  Not only is the rent payable up for negotiation but also some terms of the lease may need modernisation; the L&T Act notice provisions allow for some tactical posturing between the parties.  In those instances where the parties are unable to agree the matter will be decided either in the Courts, or by the parties' agreement through Professional Arbitration on Court Terms (PACT).   I am a member of the RICS Presidents Panel of Arbitrators for PACT referrals.  


I have extensive experience advising landlords and tenants, generally in my experience the principal issue of dispute centres on the rent payable.  Whilst the proposed lease terms will have a bearing on the rent, the L&T Act provisions also need to be considered for the impact of goodwill, tenants occcupation and improvements; the treatment of these disregards may differ from that at rent review.


Issues to consider.

  • Is the Lease renewable?  Does the landlord have statutory grounds to oppose?
  • The valuation needs to accord with the proposed lease terms and Landlord & Tenant Act provisions.  Improvements might need to be treated differently than at a previous rent review?
  • Lease renewals are not upwards only.  The valuation is to open market rental value.