Check a commercial lease before you sign

When you rent business premises, the law gives you some protection, but most of your responsibilities depend on what the lease says. Any responsibility the lease does not mention will usually be yours as the tenant. Lease terms can be negotiated, so get advice from a solicitor who handles commercial property before you sign.

Who pays for repairs and insurance

Your lease should say who is responsible for repairs and maintenance of the property. Leases usually follow one of three patterns.

If you will be responsible for repairing the structure or the whole building, ask for a schedule of condition: a written and photographic record of the state of the premises when you take them, attached to the lease, so your repair obligations can be measured against it.

How the rent can change

A rent review clause lets the rent change on set dates during the lease. The clause sets how the new rent is worked out, for example by reference to the market rent for similar premises, an inflation index, or your turnover, or by fixed increases agreed at the start.

An upwards-only review lets the rent rise or stay the same at review, but never fall. The English Devolution and Community Empowerment Act 2026, which received Royal Assent on 29 April 2026, stops these terms working in business leases in England and Wales granted after the change comes into force. Where a review is based on the market rent, an index or turnover, the new rent will be that figure, even if it is lower than the rent you pay before the review. Rents fixed in advance in the lease are not affected.

The change comes into force on a date set by regulations. It also covers a renewed lease granted after that date under a renewal agreed on or after 17 March 2026. Ask your solicitor whether it will apply to your lease.

Ending the lease early

A lease usually runs until its end date unless it has a break clause. A break clause lets the landlord, the tenant or both end the lease on an agreed date without a penalty. To use it, you must give the notice the clause sets out, and you may need to meet other conditions, such as paying the rent by an agreed date. Check that you will be able to meet every condition, and negotiate any that would be hard to meet.

Without a break clause, you can only leave early if your landlord agrees to take the lease back, which is called a surrender, or agrees to let you pass it on. Otherwise you must keep paying rent for the whole term.

Passing the lease on

Whether you can assign or sublet depends on your lease, and you will usually need your landlord's permission. If the lease lets you assign, sublet or charge the premises with the landlord's consent, the law adds that consent must not be unreasonably withheld.

When you apply in writing, your landlord must, within a reasonable time, give consent unless it is reasonable not to. They must also tell you their decision in writing, with any conditions or their reasons for refusing. It is for the landlord to show that their timing, conditions or refusal were reasonable.

If you assign a lease granted on or after 1 January 1996, you are released from the tenant covenants. Your landlord can make it a condition of consent that you guarantee the person you assign to, in an authorised guarantee agreement. That guarantee covers only the person you assign to, and ends when they are released, for example when they assign the lease lawfully. Your lease can set out in advance when the landlord may ask for one.

Service charges

In a building with several tenants, the landlord usually recovers the cost of running and repairing shared parts through a service charge on top of the rent. Your lease sets what can be charged and how your share is worked out.

The RICS professional standard Service charges in commercial property, 2nd edition, took effect on 31 December 2025. It sets out best practice for managing service charges, including issuing budgets and year-end certificates on time, and it is mandatory for RICS members and RICS-regulated firms. Ask for recent budgets and year-end certificates before you sign, and check whether the lease makes you pay into a reserve or sinking fund and what happens to that money when you leave.

Your right to renew

Most business tenants in England and Wales have the right to renew their lease when it ends, under the Landlord and Tenant Act 1954. Your landlord may ask you to give up that right before you sign, which is called contracting out. To do this, the landlord must give you a warning notice and you must sign a declaration before you are bound by the lease. If you contract out, you have no right to a new lease when the term ends, so weigh that against the rent and other terms you are offered.