Malcolm Hull of Drivers Jonas has said that it is unlikely that the government will ban upward-only rent reviews (UORRs) prior to the next general election. Mr Hill said: “The government has published Reading University’s report on the 2002 Code of Leasing Practice. No decision has been made on whether to legislate against UORRs and this now looks unlikely to happen before a general election.”
The report finds that lease terms for commercial property lettings continue to become more flexible. Where there are rent reviews in leases, UORRs are overwhelmingly still the most common type.
The main findings are that average lease lengths continue to fall and are now around 7 years; there is considerable spread and diversity of lease lengths in all sectors; leases to small businesses are considerably shorter than average; leases on newly constructed properties are considerably longer.
There has been a significant increase in the use of tenants break options, which are now found in nearly a quarter of all leases. The proportion of leases with no rent reviews continues to rise with no rent reviews in the case of up to 75 per cent of all industrial leases
The ODPM has indicated that it is still interested in receiving any further evidence or opinions on the need for legislation.