Rent Reviews – Proactive not Reactive!

Professional Services News

 

Mark Bradley at FHP specialises in retail rent reviews having over 25 years experience in this field.  Although the bulk of his workload is concentrated within the East Midlands, and in particular Nottingham City Centre, Mark’s previous life as Estates Manager for Coral Bookmakers and Olivers/Timpson Shoes with branches nationwide, means that he is familiar with most towns and cities throughout the UK.

Mark comments “The essential point with rent reviews, whether acting for landlord or tenant, is to be proactive rather than reactive.  In a market where rents are rising, tenants should not allow the review to drift as new evidence at a higher rent may emerge.  Alternatively, in the same situation, landlords will not want to trigger the review too early.  Tactics are a vital ingredient of rent review negotiations and it is crucial to be in control rather than allow the opposing party to dictate procedures.  We notify our clients well in advance of the review date so that we can determine how best to proceed.  Our extensive database of comparable transactional evidence, which is constantly updated, enables us to advise our clients of the estimated rental value prior to the rent review negotiations commencing and accordingly we can decide and advise upon the most appropriate course of action.”

It is also vital to keep abreast of the current case law relating to rent reviews since they are conducted in a hypothetical situation with assumptions and disregarded matters set out within the rent review clause in the lease.  For example, some leases require the parties to value the rent assuming a 25 year lease term.  These were common place in the boom times of the late 1980s and early 1990s but nowadays the norm is for shorter lease terms so tenants have successfully obtained a discount for the assumed longer lease term.

With regard to lease renewals, whilst the current provisions have removed many of the previous time limit traps, there are again tactical issues to consider under the new regime and it is essential that an early appraisal twelve months before the lease expiry date is undertaken.

Therefore, the message is “review your reviews well in advance of the due date.”

If you would like advice in respect of your rent review, Mark can be contacted on direct dial 0115 8411137.