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Five points to remember when you negotiate for your Commercial Property Lease

Five points to remember when you negotiate for your Commercial Property Lease

Does the property that you are taking require a re-fit or repairs and refurbishment? How long will this take you? While you are dealing with this the property is not generating an income.

Ask for a RENT FREE PERIOD to enable you to offset the time it will take to carry out any essential works.

Whoever is named as the Tenant in the Lease will be responsible for the obligations under the terms of the Lease. If the Tenant is an individual then that person would be personally liable for the payment of rent, service charges, insurance, etc.. If that individual falls behind with these payments the Landlord may be able to go after your personal assets to recover money owed. It may be that you could take the Lease in the name of a Limited Company. If the Lease is taken in a Company’s name the Landlord may require a Rent Deposit or a Personal Guarantee. Always avoid giving a Personal Guarantee where possible.

Think carefully about WHO IS TAKING THE LEASE.

It may be possible to end the Lease early rather than it having to run the full term of years. This will enable you to downsize or upsize as your requirements change.

Negotiate a BREAK CLAUSE

Agree the state and condition of the property at the start of the Lease with the Landlord, either in writing or by way of photographs or both. Limit your obligation to reinstate the property only to the condition it was in at the start of the Lease.


Ask your solicitors to give you an estimate as to the costs you are likely to incur. These can mount up. In addition to the Rent there may be a Rent Deposit to find, Stamp Duty Land Tax on the rent passing, Land Registration fees, searches and, of course their costs and VAT. A good solicitor will be able to let you have an estimate as to their costs and disbursements but always remember that an estimate is the lowest figure that the solicitor believes that he will be able to charge for the transaction.


If you are negotiating a new lease or thinking about taking on commercial premises and you would like to discuss any aspect of the proposed transaction then please contact Stephen Cook of QualitySolicitors Copley Clark Commercial Property Team on 01737 362131 or email

© QualitySolicitors Copley Clark 2016


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