Cracking the Code on Commercial Leases

Are you are about to take out a new lease on premises in England or Wales?

If so, it’s worth checking to ensure your Landlord is willing to observe the 2007 Code for Leasing Business Premises.

Heather Smith of the Beattie Partnership, one of Spiral’s approved business partners, has outlined for us the main features of the code.

The 2007 Code was formally launched by Yvette Cooper, Minister for Housing and Planning on 28 March 2007.  It was initiated by the property industry, and its main objective is promoting fairness in commercial leases, and to delay a legislative solution being enforced by the Government.

It has been endorsed by top representative bodies in the property industry and is aimed at promoting awareness of property issues, especially among small businesses.

The new Code is made up of three elements:

The first is the main document, which consists of 10 recommendations to Landlords.

The second is the Occupier’s Guide and is aimed at small businesses and every occupier of commercial premises.

The third document is a Model Heads of Terms outlining the main points that should be covered in a commercial lease.  This acts as a sort of checklist for new tenants and existing tenants negotiating rent reviews or lease renewals.

So what does this mean for tenants?

The new Code should assist in creating market change for the better and also build confidence between Landlord and Tenant.  Transactions should be completed more quickly and with fewer conflicts, leaving tenants feeling confident and more aware when negotiating leases.

The Code remains voluntary and although the Government is keen to ensure best practice, tenants should be mindful that some Landlords might operate away from the Code. 

If you are about to take on a new lease, it is wise to consult a surveyor to verify that the spirit of the new Code is being adopted.

For more information on The Code for Leasing Business Premises in England and Wales 2007, visit www.commercialleasecode.co.uk.

The Beattie Partnership is an approved Spiral supplier, and offer property advice and services across a range of market sectors including Rating, Landlord and Tenant, Acquisitions and Corporate Property Advice.  For more information contact us here at Spiral.