Complex Lease Terms

A Henry Stewart Master Class

It’s not just drafting – it’s negotiation AND drafting. Where you start affects where you end up and the Heads of Terms set the tone. Do not concede value unnecessarily but equally don’t lose an opportunity because you don’t know what’s possible.

Remember: lease negotiation is complex – there are many pitfalls. This one-day briefing will ensure that it is not you who is out of touch with what’s happening in the commercial property market.

Now read on:

Advances in technology (think the impact on the high street from online shopping), economic uncertainty and the growth of serviced offices and pop-up occupiers can impact the commercial property market and norms in lease negotiations. Lease terms must adjust to reflect the realities of business – who has the stronger hand – landlord or tenant? The fluctuations in the bargaining position of the parties can be an outcome of supply and demand, industry codes and guidelines as well as legislation and case law.

This one-day briefing covers the latest thinking and trends in lease terms – what is being negotiated, what is being drafted, what is being agreed and what is being rejected.

This Master Class is for owners, occupiers, surveyors/agents, funders active in the current market and their legal advisers. The Course Directors – Roger Woolley, Partner and Head of Real Estate and Development, Claire Long, Associate, Real Estate Development, and Lana Farrell, Associate, Real Estate Development Team at Lester Aldridge LLP, with Simon Wainwright, Managing Director, JPW Real Estate – will take a practical look at the latest trends including:

What the agents and their principals should sort out before passing the agreed terms to solicitors

Ensuring the Heads of Terms are detailed enough
Key points to consider adding to Heads of Terms which can make a difference to lease negotiations right at the outset
What should and should not be included and detailed in the Heads of Terms
What can be done to minimise the potential problems later down the line

Update in relation to the Lease Code

The length of leases

What is acceptable and what is not in the current market
Striking the right balance from both the landlord and the tenant’s perspectives
How to adopt the right negotiating position, being mindful of what each party in the negotiation is seeking to achieve
Impact of shorter lease terms on both landlord and tenant including a focus on the repairing liability and Schedules of Condition and Service Charge provisions

Occupational Sharing provisions

Group sharing
Concessionaires and Franchisees

Current trends in relation to rent free periods

Security of tenure

To exclude or not to exclude
Options to renew? Particularly where complex rent review or lease terms are involved

Break clauses (mutual or tenant only)

What is likely, what is possible and what is realistic?
Latest trends in Break Clauses
Conditionality in Break Clauses
Impact of the Lease Code

Rent review clauses

Open market review verses RPI/CPI review
Other ways to vary rent
Possible future trends
Tailoring the review provisions to reflect use (e.g. care homes, hotels and licensed premises – properties with non-standard users)

Rights to assign and underlet