Commercial leases

Commercial leases

As a business Tenant, you may reach the day when you want to move on.

Perhaps your business is flying and you need bigger premises, or perhaps the character of the area has changed and you are losing business where you are. Or maybe you simply want to retire!

If your Lease doesn’t run out for some time, you will need to consider the possibilities, which your solicitor should have explained to you at the outset:

Passing the Lease to another Tenant

This is usually possible, provided the new Tenant gives suitable references to the Landlord. But your liability to pay the rent etc. may not end altogether, and how long it continues will depend on the date and terms of your Lease. Please ask for our separate fact sheet on this subject called “The End of Privity of Contract?”

Breaking the Lease

Some Leases will contain a “break” clause which you can exercise on a set period of notice, provided your rent is up-to-date and you have complied with your other obligations. It is best if the “break” notice is prepared and served by a solicitor.


This involves an agreement with your Landlord that the Lease will end early. Naturally, unless rents have gone up and/or the Landlord has other Tenants ready and willing to move in, he will often be unwilling to agree without some financial inducement (sometimes called a “surrender premium”).

The conclusion to draw is that, once you are committed to a Lease, it can be difficult to “escape”. At least ensure that you are fully aware of your liabilities and, if possible, try to make your position as flexible as possible from the start, by explaining your plans and priorities to a solicitor.

For further advice on property and other business issues, contact our commercial team at Hand Morgan & Owen on Stafford 01785 211411 or Rugeley 01889 583871.

Published on web site – January 2007


The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances. (50587)