The British Retail Consortium (BRC) is urging the Government to bring forward legislation to tackle upward only rent reviews.
The BRC, responding to the publication of Reading University’s research into the Code of Practice for Commercial Leases, says the research confirms retailers’ concerns that the voluntary code is still not working.
The report shows that 99% of rent reviews are still upward only, despite greater awareness of the code, and landlords continue to impose onerous conditions on a tenant’s ability to assign and sublet, meaning businesses are still carrying the cost of redundant space.
The report also reveals that most tenants are reluctant to negotiate with landlords on rent reviews, as they know that it is not negotiable, says the BRC.
Kevin Hawkins, BRC director general, said: “Upward only rent reviews are an iniquitous system found only in the UK and have no place in an open and competitive economy.
“Retailers need lease terms which will help them respond quickly to changing market conditions. As things stand, everything is loaded in favour of the landlords and terms are too rigid.”
References: EGi Legal News 24/2/05
