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Lease Renewal Case Study | Kirkby & Diamond

Case Study - Lease Renewal

Published on Wednesday, 18 May 2011

Peter Wilson – Partner Kirkby & Diamond

Objective
The clients are a tenant of a modern industrial unit on an industrial estate on the edge of an established market town.  The lease was due to terminate some 12 months ahead.  Rental values had fallen since the start of the existing lease.

 
Strategy
As rental levels had fallen, there was a possibility that the landlord would delay serving a formal notice to terminate the lease in the hope that the tenant, if not advised, would allow the existing lease to continue at the existing rent.
 
Implementation

The client was recommended to initiate the lease renewal process himself under the Landlord and Tenant Act (1954) in order to bring the Landlord to the negotiating table to ensure that a new, lower rent would become payable at the earliest possible date.
 
Result
Taking into account the reduction in rental levels and all relevant comparable evidence, a renewal of the lease was successfully negotiated with a rent that was some 30% below the rent passing under the old lease.