19 MAR 2018
RICS, alongside major industry bodies, is developing new mandatory requirements to ensure businesses of all sizes gain fairer, flexible leases.
Lease negotiations and rent reviews can be a bone of contention between landlords and tenants of commercial property, and can lead to a dispute between both parties.
However, RICS' proposed professional statement with mandatory requirements around heads of terms – known as the Code for Leasing Business Premises – aims to ensure both are armed with the relevant information necessary to negotiate the fairest rent agreement and lease terms available to them.
For example, the Code for Leasing Business Premises explains the terms of a lease agreement for occupiers, and what to do if their landlord wants to increase their rent by what they feel is an unfair amount.
The Code for Leasing Business Premises not only provides helpful tips for tenants, it also provides guidance for landlords on how to be ‘code-compliant’ to ensure they too, benefit from a more transparent lease with greater flexibility in its terms. Measures include clearly stating in the lease agreement the proposed duration of the tenancy, rent review dates and upfront details of service charges a tenant is liable for.
RICS has collaborated with leading commercial property professionals and industry bodies – including British Property Federation, British Retail Consortium, Federation of Small Businesses and the Law Society – to produce balanced recommendations within the Code for Leasing Business Premises, that reflect the needs and opinions of both landlords and tenants.
The deadline to respond to the RICS Code for Leasing Business Premises consultation is 12 April.