Lease renewals

Introduction

This information aims to clarify the options available when the lease for a unit in a Workspace Group business centre or estate is coming to an end. Briefly, the lease can be renewed or notice given to vacate the unit. The information given here is intended as general information and does not constitute legal advice.

The lease

This is a signed legal contract conferring rights and duties on both signatories - the landlord and tenant.

The majority of leases granted by Workspace Group have rights granted by Part II of the Landlord and Tenant Act 1954 (as amended) that entitle tenants occupying premises, for business or professional purposes, to new tenancies as of right - provided that certain procedural steps are taken within the prescribed time limits.

Please contact a member of the Renewals Team at Workspace Group on 020 7247 7614 for information on which leases have this protection.

I would like to renew my lease and stay

Workspace Group normally reviews all leases 6-12 months in advance of their expiry date. An official notice is served under the provision of the Landlord and Tenant Act 1954 known as a Section 25 Notice. This Notice confirms the end date of the lease and will set out the steps that need to be taken to renew your lease.

A new lease

Workspace Group offers a standard lease across its property portfolio. The lease is based on the Law Society short-term business lease, and is designed to be user friendly without the need for any prior property knowledge. Thus the need to appoint surveyors and solicitors is reduced.

How is the new rent assessed?

A new rent is assessed using comparable information from other leases granted within the business centre or estate, or those achieved for similar properties located nearby. The comparable information includes the amount of rent achieved for new lettings and lease renewals for units of a similar size, quality and lease term - this is generally referred to as market rent.

Commercial property rents react in a similar manner to the rents for residential property, with popular areas achieving higher values due to the greater demand for space.

Budgeting for rent increases

When planning ahead with regard to budgets, or funding, it is not advisable to estimate for annual rental growth by simply using the rate of inflation since, as seen with the residential market, growth in commercial property rents can also exceed the prevailing rate of inflation.

I would like to leave when my lease expires

Under the Landlord and Tenant Act 1954 the tenant is required to give Workspace Group at least 3 months written notice before the date on which the lease is due to end. When this is done, the lease will then finish on the contractual end date.

If there is less than three months remaining before the contractual end date, or the lease has already come to an end and the tenant is "holding over", the tenant is then required to give Workspace Group at least 3 months notice to end on a quarter day. Quarter days are 25th March, 24th June, 29th September and 25th December.

If written notice is not given in time, it could mean that the tenant is still responsible for the lease, and associated payments, on the unit up to a further six months.

Once notice to leave is confirmed in writing by Workspace Group, an inspection will take place regarding the condition of the unit - this is known as dilapidations. A leaflet on dilapidations is available on the web site or by calling the Marketing Team on 020 7247 7614.

Further information

If you need any further information, please contact the Renewals Team at Workspace Group on 020 7247 7614.