If you have ever negotiated a lease of commercial premises you will probably have come across the term 'upwards only rent review'. For those of you who haven't, it is quite simply a provision in a lease which allows the rent to be reassessed (typically every five years but it can be reviewed at any time in principle) by reference to the rent a landlord would be able to charge a new tenant at the time of the review but crucially the review cannot cause the rent to fall.
During the last ten years, you are unlikely to have seen a commercial lease being negotiated which allowed rent to be reviewed both upwards and downwards. Fundamentally, the reason has been that in a rising market it was an academic point because no-one expected commercial rents to fall. Today, however, commercial rents are falling and so it behoves those of us advising tenants to question whether we should be resisting an upwards only rent review.
Why shouldn't a tenant be able to say to his landlord "Please sir, I don't want some more"?
If you are about to negotiate a lease then contact commercial property lawyer, Steve Petty, on 01926 629005.
Steve Petty, Commercial Property Lawyer
This blog is not intended to constitute legal advice, nor is it intended to be a complete and authoritative statement of the law, and what we say might be out of date by the time you read it. You should always seek legal advice to confirm whether or how any information in this article applies to your particular situation. We offer a free telephone consultation to discuss your particular circumstances.