News

July 06, 2012

Off-the-shelf lease to inject new life into the British high street

RICS, in collaboration with the British Retail Consortium (BRC), has launched a free small business retail lease to attract independent shopkeepers into empty high street units.

The lease, which has been developed and authored by Nick Darby of SNR Denton UK LLP, has been devised to simplify the complex process associated with commercial property leases. It is hoped that the free contract will enable quicker occupation of retail premises by SMEs, helping to stimulate the British high street at a time when the latest figures from the BRC show town centre vacancy rates of 11.1%.

Paul Bagust, associate director, Professional Groups and Forums at RICS said: “By offering mutually beneficial terms to landlords and tenants in a flexible lease, we are directly addressing the principles of the Code for Leasing Business Premises — identified in the Portas Review as a key tool in tackling the high street’s decline.”

Tom Ironside, director of business at the BRC, said: “The high street is a much-loved institution but it can be a tough place to trade, with property costs a significant challenge for all. As well as assisting individual retailers, this new lease will make it quicker and easier to get those empty units back into use, preventing them acting as a drag on the performance of an entire area.”

The lease takes the form of an eight-page proforma, providing the tenant with fixed property costs and a clear picture of the responsibilities they are signing up to. Intended for leases of up to five years, it is a standalone short-term contract with no rent review. It offers entirely flexible terms for occupiers, including break clauses. For both tenants and landlords, the costs of a long lease negotiation process are significantly reduced.

In response to industry feedback, two versions of the lease have been developed, one with security of tenure under the Landlord and Tenant Act 1954 and one without. Under the Act tenants have the right to renewal of the lease.

You can download the lease and explanatory notes here: www.rics.org/smallbusinesslease.