Commercial Lease Assignment: Top 3 Renegotiation Clauses
Commercial Lease Assignment: Top 3 Renegotiation Clauses
What are the top three clauses in a UK commercial lease that a buyer should attempt to renegotiate before the lease assignment is finalized?
3 Answers
Before finalising a UK commercial lease assignment, a buyer should renegotiate rent and review terms, break clauses, and repair and maintenance obligations to reduce costs and ensure flexibility.
The top three clauses a buyer should try to renegotiate in a UK commercial lease are rent and rent review terms, break clauses, and repair and maintenance obligations. Getting these right can feel like a huge weight lifted: fair rent and predictable reviews prevent nasty surprises, a sensible break clause gives you an exit if things go south, and reasonable repair obligations stop the lease from turning into a money pit. Negotiating them upfront can make the business feel far more secure and less stressful to take over.
A buyer should focus on renegotiating the rent review clause to limit upward-only increases, as this directly affects long-term costs. The break clause is also critical, providing flexibility if the business underperforms. Finally, clarifying or softening repair and dilapidations obligations can significantly reduce future financial exposure.