Rent review—a practical lease negotiation guide


Published by a ³ÉÈËÓ°Òô Property expert
Practice notes

Rent review—a practical lease negotiation guide


Published by a ³ÉÈËÓ°Òô Property expert

Practice notes
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This Practice Note considers the negotiation of open market Rent Review provisions in a rack Rent commercial Lease by a landlord and its tenant. It identifies key concerns for each party and factors that impact on valuation. It also suggests possible amendments and considers how the rent review clause interacts with other lease provisions. For further guidance on the principles behind rent review provisions and relevant case law, see Practice Note: A guide to rent review for property lawyers.

Importance of rent review clauses for landlords

Provisions for periodical review of rent are often included in longer term leases to allow the rent to keep up with the changing rental values of property. In MFI Properties v BICC Group Pension Trust, Mr Justice Hoffmann (as he then was) said:

‘A rent review clause is designed to deal with a particular commercial problem, namely that of the tenant who wants security of tenure for a lengthy term, and a landlord who, in times of inflation or a rapidly changing property market, does not want to commit himself to a fixed

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Jurisdiction(s):
United Kingdom
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Key definition:
Rent definition
What does Rent mean?

Consideration payable under a lease, the amount of which must be ascertainable with certainty throughout the term (usual via a rent review if not stated in actual figures). Commercial rents are usually paid in advance by equal instalments on the quarter days or other dates specified as rent payment days.

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