Is Your Business Lease Excluded

Date Added: 02 February 2011

Are you a Tenant looking at entering into a new Lease or renewing your existing one?

Are you a Landlord letting your property out for the first time or do you have a Tenant whose Lease is due to expire?

Leases of business premises for more than 6 months normally come with an automatic right of renewal so that at the end of the Lease, unless the Landlord wants to develop the premises, use the premises for its own purposes and in other limited circumstances, the Tenant is automatically entitled to a new Lease.

It is becoming increasingly common for Landlords to try and exclude this right of renewal and the process for doing so is very straightforward.

What does this mean for you
If you are a Tenant taking a new Lease or a Landlord looking to grant a new Lease, you will want to consider whether the Lease should have an automatic right of renewal or not. As a Tenant, you will want some protection so that your business can carry on in the premises when the Lease comes to an end and, as a Landlord, you may want some flexibility to bring in a new Tenant if for whatever reason you are not satisfied with the Tenant who has been in there.

If you are currently a Tenant with a business Lease, it is extremely important to consider whether you want to stay in the property at the end of the Lease and whether you have the right to do so. Enforcing this right is complicated.

If you are a Landlord with a Tenant in your premises, then you will want to consider whether you want to keep that Tenant, or whether you wish to offer them a new Lease but with different terms, including a different rent. If the correct procedure is not followed, it may be difficult to obtain a higher rent for quite a period of time.

If you are a Landlord or a Tenant of business premises and you need some advice regarding your Lease, please contact Mark Dewey or Andrew Doinik in our Commercial Property Department.

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