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Rent Reviews
Rent review provisions in commercial property leases were originally
introduced to counter the effect of inflation during the term
of the lease.
A standard rent review clause will generally require the
rent to be reviewed at fixed intervals, usually five yearly,
during the term.
The vast majority of rent review clauses require the assessment
of the open market rack rental value, at the review date,
in accordance with specified terms.
Some rent reviews are however geared to the tenant's turnover
or profitability, or movement in the Retail Price Index.In
the case of calculating the market rent for a demised premises,
the form of the review clause will vary from lease to lease.
In general however the clause should make clear:
(i) the review period
(ii) the procedural steps for having the rent reviewed
(iii) whether or not time is of the essence in the service
of notices
(iv) the basis of valuation, i.e. assumptions and disregards(v)
any hypothetical terms and conditions to be adopted
(vi) in default of an agreement, the procedure for the appointment
and determination by a third party surveyor such as an Independent
Expert or Arbitrator
(vii) the effect of a late review, i.e. from when the rent
is payable and whether interest is payable thereon
(viii) whether the rent can be reviewed upwards or downwards
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Before you go office
hunting, make sure you have defined your space needs and service
priorities. Global Office Search can help you determine your
exact space requirements, locate the commercial properties that
best fit and help you negotiate favourable terms. |
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Global Office Search
Global Office Search
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in-depth knowledge. |
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| Insight on the potential
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property and land in London and throughout the UK. |
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warehouse, distribution or industrial space, and we represent
many owners, occupiers, developers and investors across the
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process, we offer an informal meeting to assess the realistic
options of selling or letting existing commercial property
or finding more suitable alternatives. |
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but you decide what happens next. |
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