Unusual Rent Review Provision on Blackburn Property

Professional Services News

Acting on behalf of a private family trust landlord, Fisher Hargreaves Proctor has settled the rent review on premises at 39/41 King William Street, Blackburn let to HBOS Plc at a new rental of £195,000 per annum equating to £107.50 Zone A.

The rent review negotiations were conducted by Mark Bradley who was involved jointly with John Proctor in acquiring the investment for the private trust in 2003.

The rent review clause contains an unusual provision in that the rent for the entire building is to be based on 115% of the market rent of the ground floor and basement. 

Market Bradley commented “The reason for this provision originates from some shrewd foresight by the previous landlord on the initial letting to HBOS to secure a guaranteed rent.  HBOS physically occupy only the ground floor and basement.  The upper floors are sublet as a gymnasium and it was perceived by the landlord that on rent review, there would be very limited comparable rental evidence for such use.  Therefore, the formula applied on review avoids any potential dispute on the global rent once the appropriate rental value for the ground floor and basement have been established.”