Bira CEO, Andrew Goodacre's latest comments
"This has been around since 1954. There was talk of reform last year but those plans seem to have been shelved. A new government must address this issue because the Act is not fit for purpose in many ways.
"We have been asking for greater protection for tenants who are running good businesses but know that the landlord has all the power when it comes to lease renewal. We would also like to see the policy of upward only rents removed, replaced by process that better reflects the market conditions. Changes to this kind of ACT take time, and I am sure the property owners would have different views to me. However, I think we all agree that change is necessary."
What do I need to know?
There have been several key reforms related to the Landlord and Tenant Act in the UK as of September 2021 that aim to provide increased protection and flexibility for businesses in relation to commercial rents.
It's important to note that the specific details and requirements of the Landlord and Tenant Act can vary depending on the nature of the lease, the property type, and other factors. Therefore, it is advisable for businesses to seek professional advice or consult the latest legislation to ensure compliance and understanding of their rights and obligations under the Act.
Our position
- Highlight the current practice of upward-only rent reviews, which can create an unfair burden on tenants
- Advocate for a revision of the landlord and tenant act to ensure greater security of tenure for tenants and the removal of upward-only rent reviews
- Emphasise that rents should reflect market conditions rather than being solely dictated by landlord demands
What you can do
Keep us informed by letting us know of any current issues, opinions or updates. Email membership@bira.co.uk.
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Some notable aspects of the reforms:
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Security of Tenure: The Landlord and Tenant Act provides commercial tenants with security of tenure, which means they have the right to remain in the premises after their lease expires. The Act offers various protections to prevent unfair eviction and provides the opportunity for lease renewal or negotiation of new lease terms.
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Rent Reviews: The Act governs rent reviews, which are periodic assessments of the rent payable by a tenant. Reforms aim to ensure transparency, fairness, and predictability in rent reviews, providing mechanisms for resolving disputes and avoiding excessive rent increases.
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Upward Only Rent Reviews: Historically, commercial leases often included clauses for upward-only rent reviews, meaning the rent could only increase at each review and could not decrease, regardless of market conditions. However, reforms have sought to address this issue by allowing tenants and landlords to negotiate more flexible rent review mechanisms that consider market fluctuations.
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Lease Length and Renewal: The Act provides procedures for lease renewals, allowing tenants to request a new lease at the end of their term. Reforms have aimed to simplify and streamline the renewal process, ensuring that tenants have the opportunity to negotiate favourable lease terms and promote stability for their businesses.
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Dispute Resolution: The Act provides mechanisms for resolving disputes between landlords and tenants, including rent disputes, lease renewals, and breaches of lease terms. Reforms have sought to improve the efficiency and accessibility of dispute resolution processes, such as through alternative dispute resolution methods or specialised tribunals.
(It's important to note that specific reforms may have been implemented or proposed since then, and it's always advisable to consult the latest legislation or seek legal advice for the most up-to-date information.)
