Rent Reviews allow the periodic adjustment of the commercial rents to the market level, and typically they occur every 3 to 5 years subject to the clause in the lease.
Usually, the rent review process is outlined in the lease and is typically carried out in one of two ways:
- RPI Rent Review – The Retail Price Index (RPI) monitors the changes in the prices and products within the market. The rental rate is adjusted to reflect the changes in the RPI, based on the levels of inflation. For example, if the index increases by 3%, then the rent would increase by the same percentage.
- Market Rent Review – The increase in rent is based on the appraisal of a property’s value at the time of the rent review. The review will compare the rental value of other properties that are of a similar type and use in the area.
Tenants should be aware that most leases state that rent can only be adjusted upwards. This means that the rates can only rise or stay the same; they will never be lowered.
Rushton Hickman acted on behalf of a private investor who have recently secured a 28% increase in the rental of an industrial unit on Hawkins Lane, Burton effective from January 2023.
The last few months have shown a period of change within the market, and Rushton Hickman have experienced rent review surveyors who call upon their extensive in-house data, enabling us to achieve market rent for our clients.
If your lease has an upcoming rent review clause then please contact our friendly team on 01283 517747 or email email@example.com.