My landlord is increasing my rent, what can I do?

Published on: 24th November 2015

The problem - My landlord has sent through a letter to say my rent is going to increase, is there anything I can do about it without losing my premises?

Most tenants of retail premises now-a-days take 10 year FRI leases that include tenant break options and rent reviews on the 5th anniversary of the term. The rent review provisions are intended to allow the landlord the opportunity to increase the rent in line with open market values in that locality every 5 years and whilst many tenants may think that rental values have been falling over the past five years, this is not always the case and there has been rental growth in certain sectors and locations around the UK.

The rent review provisions are set out in the lease and all negotiations will be carried out in accordance with the agreed lease. These provisions will include a procedure for the review to be determined by a third party, either an Arbitrator or an Independent Expert if an amicable settlement cannot be reached. Please note that in the event that the matter does go to third party then you may risk becoming liable for half of if not all of the Arbitrator’s or Expert's costs. 

What should I do?

In the first instance don’t panic. We strongly advise you check your lease to make sure there are no onerous provisions making time of the essence. Once this is done you should respond to the landlords rent review notice requesting that they provide relevant market evidence that justifies the rent they are seeking. Whilst you might find that you are able to shave something off the landlord’s quoting rent it is often the case that you may secure a better settlement if you seek professional help and guidance. You will not lose your premises if you challenge a rent increase but you may adversely affect the viability of your business if you do not achieve the right settlement.

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Lease Consultancy

Sanderson Weatherall’s Lease Consultancy team are leaders in the field. We are expert negotiators in rent and lease terms for all forms of commercial properties across the UK. Our knowledge of the property market and experience in dealing with complex tenancy agreements allows us to deliver top results for you, no matter how big or small your business is. Our understanding of business and people also means we’ll work with you to achieve the best result, without damaging your relationship with your landlord or tenant. The Lease Consultancy team are able to offer: Lease Audits We will analyse your leases and identify, critical dates and liabilities leading to the creation of a comprehensive lease database. This will simplify your processes and avoid key dates and obligations being overlooked. Lease Renewals & Restructuring We will undertake a strategic review and inspection of your property portfolio and identify opportunities to rationalise or restructure leases, and reduce your costs by reviewing future lease events and potential liabilities. Rent Reviews We act on your behalf on the negotiation of rent and lease terms to obtain the best possible outcome. Dispute Resolution Our highly experienced lease consultancy team will represent you at Court and Arbitration and have a wealth of experience in the preparation of Expert Report and Replies to Independent Experts and Arbitrators. Members of the team are also frequently appointed by the RICS to act as arbitrators, Independent Experts and Mediators. Strategic Property Due Diligence Advice We provide detailed rental advice if you are considering acquiring property or businesses with existing leasehold liabilities. Contact Us

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