Commercial Property Lease

• Posted onJuly 31, 2017

Why is a Commercial Property Lease necessary?

Having a written commercial property lease to govern occupation is beneficial to both landlords and tenants as it ensures both parties are aware of their respective obligations at the outset, and there is always something to refer back to if any issues arise. That said, it can be all too easy for a landlord to look to fill an empty property quickly; or for a tenant to look to move in and start trading as soon as possible, and while things are good to forget documentation entirely.

Problems often occur when things aren’t so good; for example when the tenant runs into difficulty paying the rent; or does not leave at the end of the agreed term. Without a written lease in place, a landlord may find it very difficult indeed to bring the tenancy to an end, particularly if the tenant has gained the protection of the Landlord and Tenant Act 1954. The Act provides that if a tenant has exclusive use of all or part of the property and is using it for business purposes, this may inadvertently result in a “protected tenancy”.

If a tenant has a protected tenancy and stops paying their rent or refuses to leave at the end of the term, a specific procedure must be followed which requires at least 6 months notice to try to bring the tenancy to an end. This may of course be very costly to a landlord who might not be receiving any rent in the meantime, and may not in the end be effective.

There are unlikely to be any problems if the tenant pays their rent and leaves of their own accord, but tenants’ rights in respect of commercial property are complicated. It is therefore always advisable to have a properly drawn up commercial property lease which sets out the relationship between landlord and tenant, whether you are letting all or part of a property.

For further information or to make an appointment to discuss a commercial property lease please contact our team of experts.

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