DVANCED REAL ESTATE LAW AND PRACTICE
Unit 9
Guide
Drafting and Negotiating Commercial Leases: Rent Review
Context
The rent review provisions in a draft lease are often strenuously negotiated by the
parties, through their solicitors, because they go to the very heart of how much rent
the tenant will pay in the future and therefore how much income the landlord will
receive. It will come as no surprise to hear that rent review is also one of the most
disputed and litigated areas of real estate law. It is therefore vital to both parties that
the rent review provisions are thoroughly considered at the outset by their respective
solicitors.
In this Unit, you will consider rent review provisions from the points of view of both
the landlord and the tenant and develop your understanding of how events and
circumstances can affect rental value.
Outcomes
By the end of this Unit you should be able to:
1. Explain the respective views of the landlord and the tenant on rent review
provisions in a commercial lease.
2. Negotiate the rent review provisions of a typical lease, acting either for the
landlord or the tenant.
3. Advise on the compliance of the rent review provisions in a lease with the
recommendations contained in the RICS Professional Statement and Code of
Practice for Leasing Business Premises in England and Wales 2020.
Unit Workshop Tasks
In this Unit Workshop you will:
1. Take part in a role play where you will represent either the landlord or the
tenant in the negotiation of rent review provisions in a typical lease.
2. Discuss the provisions of the RICS Professional Statement 2020 and Code for
Leasing Business Premises in England and Wales and the extent to which the
rent review provisions you are working with comply with that Code.
2223_are_ws09_ce01_guide 271 © The University of Law Limited
,Preparation
To prepare for this Unit Workshop you should:
1. Read and make notes on the chapter entitled “The Rent Review Clause” in the
Commercial Property textbook.
2. View Lecture 5.
3. Read and make notes on the provisions in relation to rent review contained in
the RICS Professional Statement 2020 and the Code for Leasing Business
Premises in England and Wales which you will find on the RICS website.
4. Complete Test and Feedback - Unit 9 (Preparation).
5. Complete the Unit Workshop Preparatory Task.
Materials required for the Unit Workshop
1. Your notes from the Preparatory Task.
2. The Commercial Property textbook.
3. This Guide.
Consolidation
It is important that you consolidate your learning.
In particular you should:
1. Revise your answers to the Preparatory Task and the Unit Workshop Task in
the light of the feedback you received in the Unit.
2. Complete Test and Feedback - Unit 9 (Consolidation).
3. View Consolidation Lecture 6.
© The University of Law Limited 272 2223_are_ws09_ce01_guide
, PREPARATORY TASK
Understanding Tenant’s Amendments to Rent Review Clauses
You are a trainee at Gilbraith Saunders LLP and have returned to the Real Estate
Department to undertake the final seat of your training contract. Your supervisor is
Hu Chang, a partner specialising in commercial leasehold work.
Hu has sent you the attached email regarding a matter he is currently working on.
In preparation for Unit 9, read Hu’s email and make notes in relation to the
queries he asks you to consider.
2223_are_ws09_ce01_guide 273 © The University of Law Limited
Unit 9
Guide
Drafting and Negotiating Commercial Leases: Rent Review
Context
The rent review provisions in a draft lease are often strenuously negotiated by the
parties, through their solicitors, because they go to the very heart of how much rent
the tenant will pay in the future and therefore how much income the landlord will
receive. It will come as no surprise to hear that rent review is also one of the most
disputed and litigated areas of real estate law. It is therefore vital to both parties that
the rent review provisions are thoroughly considered at the outset by their respective
solicitors.
In this Unit, you will consider rent review provisions from the points of view of both
the landlord and the tenant and develop your understanding of how events and
circumstances can affect rental value.
Outcomes
By the end of this Unit you should be able to:
1. Explain the respective views of the landlord and the tenant on rent review
provisions in a commercial lease.
2. Negotiate the rent review provisions of a typical lease, acting either for the
landlord or the tenant.
3. Advise on the compliance of the rent review provisions in a lease with the
recommendations contained in the RICS Professional Statement and Code of
Practice for Leasing Business Premises in England and Wales 2020.
Unit Workshop Tasks
In this Unit Workshop you will:
1. Take part in a role play where you will represent either the landlord or the
tenant in the negotiation of rent review provisions in a typical lease.
2. Discuss the provisions of the RICS Professional Statement 2020 and Code for
Leasing Business Premises in England and Wales and the extent to which the
rent review provisions you are working with comply with that Code.
2223_are_ws09_ce01_guide 271 © The University of Law Limited
,Preparation
To prepare for this Unit Workshop you should:
1. Read and make notes on the chapter entitled “The Rent Review Clause” in the
Commercial Property textbook.
2. View Lecture 5.
3. Read and make notes on the provisions in relation to rent review contained in
the RICS Professional Statement 2020 and the Code for Leasing Business
Premises in England and Wales which you will find on the RICS website.
4. Complete Test and Feedback - Unit 9 (Preparation).
5. Complete the Unit Workshop Preparatory Task.
Materials required for the Unit Workshop
1. Your notes from the Preparatory Task.
2. The Commercial Property textbook.
3. This Guide.
Consolidation
It is important that you consolidate your learning.
In particular you should:
1. Revise your answers to the Preparatory Task and the Unit Workshop Task in
the light of the feedback you received in the Unit.
2. Complete Test and Feedback - Unit 9 (Consolidation).
3. View Consolidation Lecture 6.
© The University of Law Limited 272 2223_are_ws09_ce01_guide
, PREPARATORY TASK
Understanding Tenant’s Amendments to Rent Review Clauses
You are a trainee at Gilbraith Saunders LLP and have returned to the Real Estate
Department to undertake the final seat of your training contract. Your supervisor is
Hu Chang, a partner specialising in commercial leasehold work.
Hu has sent you the attached email regarding a matter he is currently working on.
In preparation for Unit 9, read Hu’s email and make notes in relation to the
queries he asks you to consider.
2223_are_ws09_ce01_guide 273 © The University of Law Limited
