Leases

There is no single right answer. Shorter leases give flexibility but less security. Longer leases give security of tenure but commit you to ongoing rent obligations. For most start-ups, a lease of three to five years with a break clause is a sensible starting point. We advise tenants on the right lease length for their circumstances and negotiate terms that protect their position.

A break clause gives either the landlord or the tenant, or both, the right to end the lease early on a specified date. Break clauses are valuable for tenants as they provide flexibility if the business grows faster than expected or circumstances change. However, the conditions attached to exercising a break clause must be strictly complied with, otherwise the right to break is lost.

A fully repairing and insuring lease requires the tenant to keep the entire property in good repair, including the structure and exterior. An internal repairing lease limits the tenant's obligations to the interior only. Most commercial leases in the UK are on FRI terms, which can expose tenants to significant dilapidations claims at the end of the lease. We make sure tenants understand their repair obligations before they sign.

Commercial leases granted for more than seven years must be registered at the Land Registry. Leases of seven years or less do not need to be registered, but notification to the Land Registry is still possible and provides stronger protection. We handle all Land Registry formalities following completion of a lease transaction.