What happens when a business tenant remains in occupation after the expiry of its lease?
What happens when a business tenant remains in occupation after the expiry of its lease?
Difficulties can arise when a business tenant remains in occupation of a property when its right to do so has come to an end. This means that the tenant will have security of tenure, and the landlord’s ability to terminate the lease will be significantly restricted.
What happens at the end of a business lease?
The tenant also has no automatic right to renew the lease. If a lease is contracted out, once the end of the term is reached you can choose to renew the rental agreement based on renegotiated terms, such as a rental increase. It is then up to the tenant if they accept these terms and sign a new lease.
Can a retail lease be terminated before the expiry date?
This clause allows both the lessor and lessee to mutually agree to end their agreement before its expiry date. If a retail lease does include this clause, it usually only applies to the initial term of the lease or during the term of the option to renew.
Can a tenant stay on a property after the lease has expired?
It’s important to note that holding over is usually always subject to the landlord’s consent. If the landlord objects to a tenant staying on the premises after the lease expires, the tenant must leave. It’s common for a lease to provide both the tenant and the landlord the right to terminate the hold over period by providing notice.
Do you need to read an expired lease?
The tenant needs to read the expired lease carefully, especially the language on renewal or extension. The language of the lease will control. Generally, where the lease requires a renewal (a new contract) at end of the term, and the term ends without such a renewal, the tenancy has terminated.
Can a landlord refuse to renew a retail lease?
If a retail lease does include this clause, it usually only applies to the initial term of the lease or during the term of the option to renew. If a lessee wishes to invoke this provision, they will need to speak with their lessor. However, a landlord has the legal right to refuse any such request.