Rent Reviews: Best Practice

Both Landlords and Tenants must be aware of the best practices to consider when commencing with a rent review. Most Commercial Leases allow for a rent review every three, four or five years, and there are many factors which come into play, but four steps will start both Landlords and Tenants off with the right frame of mind and on the correct footing:

1. Know exactly when the rent review date is.
2. Act at the review date rather than letting it drift.
3. Stay realistic about the rent.
4. Instruct a surveyor and be prepared to negotiate.

When should you start preparing for a rent review?

As soon as you know the date. The first point for either a Landlord or a Tenant is to be aware when exactly the rent review date is according to the lease. This is especially important for Tenants as, in many instances, ‘forewarned is forearmed’. If the rent review date is known and diarised, provisions can be made for a potential rent increase should there be justification, and money can be set aside for the back rent which may be demanded by the Landlord at some point.

Should a Landlord delay a rent review to get a higher rent?

No. Commercial properties are usually valued as at the review date, so leaving a rent review a year or possibly longer with a view to achieving a higher rent from market growth will not prove fruitful (why the date matters). Landlords should also be aware that ignoring the rent review may harm the relationship with the Tenant: Tenants do not relish back rent due to a Landlord not having served notice at the correct rent review date.

How realistic should you be about the new rent?

Very. Both Landlords and Tenants must remain realistic when negotiating a rent review. Landlords can technically quote any rent they wish, however unless there is justification, a surveyor will prove why the Landlord is incorrect. Conversely, there are instances when the proposed rent is justified, and the Tenant must be flexible in order to reach a realistic agreement which is mutually beneficial.

Do you need a surveyor for a rent review?

It is prudent for both Landlords and Tenants to instruct surveyors to act as their representatives and ensure the fair open market rent is achieved. Tenants who represent themselves often do not achieve the best outcome, and the end result is extra money paid in rent which a professional could possibly have saved them, through tough negotiating skills and an in-depth knowledge of Commercial Leases.

What happens if Landlord and Tenant cannot agree?

If the lease’s rent review clause allows it, either side can apply to RICS to appoint an arbitrator or an independent expert to decide the rent. RICS charges an administration fee of £425 just to make the appointment (RICS Dispute Resolution Service (opens in a new tab)).

An open mind is essential when entering into the rent review process. In most instances a negotiation will be needed to achieve an amicable outcome, so be prepared to accept advice from the professionals who strive to negotiate the most favourable result, rather than applying for the Appointment of a Third Party, which can be costly and stressful with no guaranteed results.

Are upwards-only rent reviews being banned?

Yes, for new business leases in England and Wales, but not yet. The English Devolution and Community Empowerment Act 2026 received Royal Assent on 29 April 2026 and adds new rules on rent reviews to the Landlord and Tenant Act 1954 (the Act, section 100 (opens in a new tab)).

• What changes: once the rules are in force, a rent review clause has no effect to the extent that it would put the rent above the review’s “reference amount”, such as the market rent or the index the clause uses. In practice, the rent could go down at a review as well as up.
• Which leases: leases granted after the rules come into force. Existing leases are not affected, so their upwards-only clauses still apply.
• Renewals: an arrangement to renew a lease that was entered into on or after 17 March 2026 can be caught (Schedule 37 (opens in a new tab)).
• When: the Government will set the start date in regulations, and has not yet done so (section 108 (opens in a new tab)).