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Lease Renewals

There are strict guidelines which must be met in order to protect each party’s statutory rights when renewing a lease. It is best to seek advice at the earliest possible stage, preferably 12 to 18 months before the lease expiry date, in order to consider your options and preferred route through the lease renewal process.

A Section 25 Notice is the landlord’s notice to terminate a business tenancy.

A Section 26 Notice is the tenant’s equivalent of this and includes a request for a new lease.

Both these notices must give between 6 and 12 months’ notice to terminate the current tenancy. These notices cannot expire before the end of the current tenancy.

A landlord’s Section 25 Notice must state whether or not he opposes renewal of the lease. If he opposes, the notice must specify the grounds (as stated in the Act) upon which the landlord intends to rely. If not opposed, the notice must set out prosed terms on which the lease is to be renewed.

A tenant’s Section 26 Notice requests a new tenancy and must propose new terms for the renewal.

Where a Section 26 notice is served on the landlord he must serve a counter-notice within two months saying whether or not he intends to oppose the renewal. If the landlord fails to serve a counter notice, he loses his right to oppose the renewal but can still object to the renewal terms.

Where one party has served a notice first, either s25 or s26, the other party cannot then respond by serving their own notice.

Smiddy & Company should be consulted to provide advice on the principal issues including:

  • Do you wish to renew the tenancy or not?
  • When should Statutory Notices be served?
  • How will you protect your statutory rights?
  • What should be the new rental level?
  • When can lease terms be changed?
  • Are dilapidations an issue?

 

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Smiddy & Co is an independent commercial property consultancy with its Head Office based in the Hertfordshire town of Watford and subsidiary office in Leighton Buzzard. We provide a forward thinking, professional yet personal service with expert knowledge gained through experience and market intelligence. We always seek to achieve best results for our clients.

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Watford – 01923 911007
Hemel Hempstead – 01442 601007
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info@smiddyproperty.co.uk

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