How to Prepare for the Upwards Only Rent Review Ban

We now know that the government’s ban on upwards only rent reviews will come into effect some time in 2027 or 2028, marking a major shift in commercial rent agreements. While full details are still emerging, it is clear that both landlords and tenants will need to start preparing now for how rent review provisions are structured in the future. 

Early Action is Key

Leases which are dated before the law comes into effect will not be caught. This creates a relatively limited window in which parties can still take advantage of the current position, making it important to review existing arrangements and consider whether action should be taken before the ban comes into force.

Landlords may choose to get round the ban through various mechanisms such as:

1. Agreeing reversionary lease renewals before the ban takes effect;
2. Agreeing shorter (max 6 year) contracted out leases;
3. Agreeing stepped rental increase leases; and
4. Agreeing CPI linked rental increases (although technically caught by the ban it is unlikely CPI will turn negative).

Next Steps

At SE-Solicitors, our Commercial Property team will continue to monitor the progress of the government’s ban. If you’d like to understand how best to prepare for the new regime, we can provide:

• A review of your current lease agreements

• Advice on drafting compliant rent review clauses

• Guidance on how to future-proof your commercial property portfolio

If you have any concerns or questions on your next steps as a landlord or tenant, please contact me or our Commercial Property team. 

“What is clear is, this Act has changed the commercial property landscape. Landlords must take the time to understand the new framework. They must take advice from qualified professionals.”

https://www.landlordzone.co.uk/news/end-of-upward-only-rent-reviews-what-does-it-mean-for-landlords