Section 25 notice’s – what to do next

My Landlord has sent a section 25 notice stating that my lease of commercial premises is being terminated; what should I do?

• Don’t panic; business tenants are afforded statutory rights of renewal at the end of their lease providing the original lease was not contracted out of the security of tenure provisions of the Landlord and Tenant Act 1954.
• Do seek expert advice; the notice will either set out terms on which a renewal lease will be granted or will set out the landlords grounds for refusing to grant a renewal lease. Our experts at Fisher Jones Greenwood will advise you which type of notice has been issued and whether it has been validly drafted and correctly served.
• Don’t delay; the notice will state a date on which the lease is due to be terminated. This is calculated by reference to when the notice was issued and should provide for a termination date at least six months after the date of the notice and must not be earlier that the contractual expiry date of the existing lease.
• Do seek expert help; if the level of rent for the lease renewal is not agreed seek assistance from a commercial property agent for advice as to the current market rent which is likely to be payable for the premises in your location – market rents vary according to the type of use and location. If the lease is not being renewed you will need a commercial property agent to advise you of the level of compensation to be claimed.
• Don’t be afraid to negotiate; the terms for the new lease as offered by the Landlord may not be acceptable to you and you will need to engage with the Landlord, their solicitor or their agent to put forward the terms which would be acceptable to you. Taking expert advice at the earliest opportunity will provide you with the knowledge you will need to negotiate effectively i.e. what is likely to be agreed and what will not.
• Act promptly; it is that important to merit mentioning twice!  If terms for the renewal lease can be agreed before the termination date stated in the notice the new lease can be entered into on those terms.  If terms are not agreed before the termination date the statutory date for negations must be extended by agreement.  If the Landlord will not agree to an extension of time an application must be made to court. If an application to court is not made within the requisite time period then the tenant’s statutory right to renewal will be lost.

Contact the commercial property team at Fisher Jones Greenwood for advice and assistance in connection with all types of commercial property matters whether you are a Landlord or a Tenant.  We work with a number of professionals in this field and can refer you to commercial property agents for valuation advice.

If you wish to speak to one of our Solicitors about issues related to this, you can contact our team by telephone on 01206 700113 or by email to [email protected].