Rent Reviews for Commercial Landlords – How to Secure a Fair Market Rent
How to Approach a Rent Review – A Guide for Commercial Landlords
If you’re a landlord with a commercial lease approaching a rent review date, it’s vital to understand how the process works and what your options are. A well-handled rent review can ensure your property continues generating a fair return – but if mishandled, you risk agreeing to below-market rent or missing out on an increase altogether.
In this blog, we explain the key stages in a commercial rent review, how rent is assessed, and how professional advice can make the process smoother and more effective.
At Olden Property, we act for both landlords and tenants in rent reviews – providing clear, independent valuation advice and handling negotiations to help protect your interests, whatever side of the table you’re on.
What Is a Commercial Rent Review?
A rent review is a contractual mechanism in a commercial lease that allows the rent to be adjusted periodically – usually every 3 or 5 years – in line with the market or another measure such as inflation.
The review clause in your lease will typically set out:
· When rent can be reviewed (the review date)
· How the rent is assessed (e.g. open market rent, RPI indexation)
· Whether rent can go down (most are “upwards-only”)
Understanding the lease wording is essential before entering negotiations.
How Is Market Rent Determined?
Most rent reviews are based on open market rental value – the rent a willing tenant would pay and a willing landlord would accept for the property on the open market, assuming:
· The lease continues on the same terms
· The property is let with vacant possession
· No unusual incentives or premiums are involved
A chartered surveyor will assess market rent by reviewing comparable lettings of similar properties, making adjustments for size, location, condition, lease terms and other relevant factors.
When Should You Begin Preparing?
Ideally, 6–12 months before the rent review date, so there’s time to:
· Review lease clauses
· Instruct a surveyor to advise on market rent
· Prepare for potential negotiations
· Serve any required notices on time
Rent reviews often involve negotiation – especially where the tenant disputes the proposed increase – so being proactive puts you in the best position.
What If the Tenant Disagrees?
It’s common for tenants to challenge proposed increases. That’s where professional support becomes crucial. A rent review surveyor can:
· Provide robust, evidence-based valuations
· Handle communications with the tenant or their agent
· Negotiate on your behalf to reach a fair and sustainable agreement
While this blog is written from the landlord's perspective, we regularly advise tenants too – particularly where they’re facing a proposed increase that may not reflect current market conditions.
Rent Review Clauses – Key Types
· Open Market Rent: Based on current lettings of similar premises
· Indexed Rent Review: Linked to RPI or CPI inflation
· Stepped Rent: Pre-agreed increases over time
· Turnover Rent: Based on tenant revenue (e.g. retail or leisure)
Each mechanism has its own implications, and the lease wording should be interpreted carefully.
How Olden Property Can Help
Whether you're a landlord seeking to review rent at a commercial property, or a tenant trying to understand your position and challenge an increase, we offer:
· Market rent valuations compliant with RICS standards
· Comparable evidence and reporting
· Lease clause interpretation
· Negotiation with the other party to reach a fair settlement
We act for clients across Kent, Sussex, Surrey and Greater London, covering retail, office and industrial properties.
Need Advice on an Upcoming Rent Review?
Whether you need a valuation, negotiation support or a second opinion, we’re here to help. We work on fixed fees for most instructions and are happy to provide initial advice.