“We've been operating a small retail storefront for a while now and it is not doing as well as it used to. With our internet sales up and the cost of rent being so high at the store we're wanting to end the lease on our business premises early. Is it possible to break the lease early?”
Here are the conditions under which the lease on your business premises could be broken:
Getting the Landlord's Permission, Passing the Lease On, or Subletting - If the landlord agrees to let you break the lease and you get a statement of this in writing that would be all you need. You may also be able to pass the lease on to another individual, but when this happens the landlord may require a guarantee.
Typically speaking, a lease on a commercial property will continue to be valid until the end date unless certain circumstances arise or there is a specific clause included to allow the lease to end prematurely.
Using the Break Clause to Give a 2-Month Notice - In many all commercial property leases there is what is known as a “break clause” which sets forth a specific date in the lease beyond which the lease can be broken without penalties being incurred by either party. However, to use the break clause you would have to give the notice in the strict accordance with the provisions of the breach clause in the lease. This is also fine for a landlord who wishes to exercise a break clause in the leave.
It should also be noted that if the lease is a fixed-term tenancy then it would only come to an end in the fixed date if the lease is contracted out of the security of the tenure provisions of the landlord and tenant act, after which you could continue to stay on the premises if the landlord agrees but you would be continually obligated to pay rent and would need to provide at least 3 month's notice if you decided to vacate.
If you're downsizing your office space or attempting to get out of your commercial lease to save money on financial obligations you may want to consider additional restructuring and recovery options such as a CVA. Send us your questions online or call us on 0800 644 6080 for a free consultation.
12th December 2018
Small and medium-sized enterprises (SMEs) across the UK are paying increasingly large sums of money to collect amounts owed to them by their clients and customers.Read More
4th December 2018
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