For most independents the lease is the biggest long-term commitment they will ever sign. In England and Wales, business tenancies are often protected by the Landlord and Tenant Act 1954, which gives a right to renew at the end of the term unless the parties have formally contracted out, a step that requires a specific procedure before signing. The terms that bite are rent reviews, especially upward-only ones, break clauses and their conditions, full repairing obligations, service charges and personal guarantees that put your house on the line.
Incoming tenants can often negotiate rent-free periods to cover a fit-out, and some landlords accept turnover rents, where part of the rent rises and falls with takings, which can share risk in a seasonal trade. Dilapidations at the end of a lease can be a nasty surprise if the condition at the start was never recorded. Getting a specialist solicitor and surveyor involved before signing is almost always cheaper than every alternative.
What we ask on the show
- What's the lease clause you wish someone had warned you about?
- Are turnover rents a fair deal for hospitality, or do landlords win either way?
- Would you ever sign a personal guarantee again?
- How did you negotiate your rent-free period on fit-out?