A Landlord’s Guide to Drafting a Watertight Commercial Lease Agreement
Drafting a commercial lease agreement is not just about collecting rent—it’s about protecting your long-term property interests. A poorly written lease can lead to disputes, income loss, or even litigation. For UK landlords, having a watertight lease is essential to ensure your rights are enforceable and your liabilities are limited.
At Stretton Solicitors, we help commercial landlords across the UK draft, review, and enforce strong lease agreements. This guide outlines everything you need to know to get it right the first time.
1. Define the Lease Clearly from the Start
Your lease should start with clear and accurate details about the property, tenant, term length, rent, and permitted use. Ambiguity in any of these areas can result in costly misunderstandings.
- Include a detailed property description with a floor plan
- State the lease start and end dates clearly
- Define rent review dates and any break clauses
Also, ensure that the agreement complies with the Landlord and Tenant Act 1954 (or states where it is excluded).
2. Set Out Responsibilities for Repairs and Maintenance
One of the most contentious issues in commercial leases is who is responsible for what. Clearly outline whether the lease is:
- Full repairing and insuring (FRI): The tenant is responsible for repairs and insurance.
- Internal repairing: The landlord handles structural repairs.
Attach a Schedule of Condition to reduce disputes at the end of the lease over dilapidations.
3. Cover Rent Reviews and Payment Terms
Ensure that your lease includes provisions for rent increases over time. Options include:
- Open market reviews
- Upward-only reviews
- Index-linked increases
Specify payment due dates, interest on late payments, and recovery options to maintain cash flow and legal clarity.
4. Include Legal Protections and Termination Options
A robust lease protects you if the tenant defaults. Make sure your agreement covers:
- Forfeiture rights for non-payment or breach
- Re-entry provisions
- Assignment and subletting rules
- Security deposits or rent guarantees
Clarity on these issues gives landlords leverage and helps prevent protracted legal battles.
5. Consult a Solicitor to Future-Proof Your Lease
Commercial leases are long-term contracts. Errors, omissions, or vague language can haunt you years down the line. Having a solicitor draft or review your agreement ensures it is legally enforceable, compliant with current laws, and tailored to your objectives.
Our legal team at Stretton Solicitors helps landlords avoid loopholes, protect against liability, and respond to legislative changes with confidence.
Nearly 40% of commercial property disputes in the UK arise from unclear lease terms or repair responsibilities – Royal Institution of Chartered Surveyors (RICS)
Need Help Drafting a Commercial Lease? Let Us Guide You
Don’t leave your investment vulnerable to risk. With a properly drafted lease, you safeguard your property, minimise disputes, and maintain control over your terms.
Contact Stretton Solicitors today for expert legal support in drafting, reviewing, or enforcing your commercial lease agreement. Call us now or book a consultation online.