M50 Barrier Free Tolling
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A rent review clause is a clause in a lease setting out that the rent payable in respect of that lease must be reviewed every specified number of years. The most common period in a commercial lease is every five years and at that stage, the rent is examined to see if it corresponds to the market rent at the date of the review. It is important to note that a rent review clause must be carefully drafted, as if it is not, it may not be operable or else may only give a review after the first five years of entering into the Lease, and nothing thereafter.
It is common to include an “upwards only” clause in the Lease, as therefore the rent cannot fall below what was previously payable.
A rent review is normally carried out in two ways. Firstly, by agreement between the Landlord and the Tenant or secondly, by an independent person appointed by both parties. This person can be an expert in the area or an Arbitrator. In general, a Landlord may prefer an expert as this will usually save time instead of trying to agree any rent with the Tenant. The person appointed to review the rent is generally appointed by the Landlord, however if within a certain time, the Landlord does not appoint a person, the tenant may then make the nomination. Where a revised rent has been agreed, it is advisable to record this revised rent and put it with the lease.