Commercial rent review guidance for landlords
Protecting rental value at review
A commercial rent review is an opportunity to reset the rent in accordance with the review provisions in the lease. The outcome is not determined simply by asking what similar properties are advertised for. The lease wording, hypothetical assumptions and disregards, the property itself and the quality of comparable evidence all matter.
Start with the lease
The rent review clause establishes the review date, valuation basis, assumptions and disregards, procedural requirements and the mechanism for resolving a dispute. Before forming a rental opinion, the relevant lease provisions should be read carefully.
Establish the evidence
Useful evidence may include open-market lettings, lease renewals and rent review settlements. Each transaction needs to be analysed on its own terms, including location, size, configuration, use, lease length, incentives, specification and timing.
Negotiation and settlement
A well-supported proposal can narrow the issues early. Where agreement cannot be reached, the lease may provide for referral to an independent expert or arbitrator.
When professional advice helps
Specialist advice can assist with lease analysis, rental valuation, comparable evidence, negotiation and third-party submissions.