The rent review you did not diary
The letter proposes a number and gives you a short period to respond. Everything that decides how much room you have was settled years earlier, in a clause nobody has read since.
Problems, in order · Part of Outsourced General Counsel
A rent review is run under the clause in your lease, which sets the basis, the timetable and what happens if you disagree. Dinmore Bell holds the lease estate as a register, reads the clause before the letter arrives, assembles the evidence, and negotiates the settlement, instructing a surveyor where the valuation is genuinely in dispute.
The letter arrives with a number in it. It is polite, it is short, and it proposes a new rent from a date a few months away. Somewhere in a drawer is the lease that says what happens next, and in most businesses nobody has read it since the day it was signed.
That is the whole problem. A rent review is not a negotiation that starts when the letter lands. It started when the lease was drafted, and the terms of that draft decide how much room you have now.
What the clause is doing
A rent review clause exists because a landlord granting a ten or fifteen year term will not fix the rent for the whole of it. The clause sets out when the rent can be revisited, on what basis, and what happens if the parties disagree.
The basis is the part that matters most and gets read least. An open market review asks what the property would let for today, on assumptions the clause itself sets out. An index-linked review ties the rent to a published index. A fixed uplift is agreed in advance and simply happens. These behave completely differently, and a business that assumes it has one when the lease says another is negotiating in the dark.
Open market reviews carry assumptions that are easy to skim past and expensive to ignore. The clause may require the property to be valued as if it were in good repair, whether or not it is. It may assume a particular length of hypothetical term. It may disregard improvements you paid for yourself, or it may not, and whether it does can change the number materially. Reviews are also commonly upward only, meaning the rent can rise or stay the same but cannot fall, regardless of what the market has done.
The window, and what happens if you miss it
Most clauses set out a sequence: the landlord proposes, the tenant has a period to respond, and if the parties cannot agree, the matter goes to an independent valuer, usually appointed through a professional body.
The tenant's response period is where businesses lose ground. It is often short. It is measured from service of a notice, and service has its own rules about where a notice may be sent and when it is treated as received, which means the clock can already be running by the time the letter reaches the person who needs to act on it.
Missing the window rarely means the landlord's figure is simply imposed. It usually means the useful options narrow: the chance to appoint your own valuer, to put forward your own evidence, or to trigger the referral yourself rather than wait. Those are the levers that produce a better number, and they are procedural rather than clever.
What the tenant actually controls
More than most tenants think, and less than they would like.
You control your evidence. An open market review is decided on comparable lettings, and the landlord will bring the ones that suit the landlord. Recent lettings in the same building, on the same estate, or in genuinely comparable buildings nearby, with the incentives disclosed, are the counterweight. A rent that looks high on its face may be a headline rent achieved with six months rent free, and a comparison that ignores the incentive is not a comparison at all.
You control the assumptions argument. If the clause disregards tenant improvements, then the fit-out you paid for should not be inflating the rent you now pay on it. That point has to be made with the paperwork behind it: the licence for alterations, the specification, the invoices.
You control timing and posture. A review is a commercial negotiation between two parties who will still be in a relationship afterwards. Landlords settle. Referral to an independent valuer costs both sides money and gives both an uncertain outcome, and a tenant who is evidently prepared to go there is in a better position than one who is not.
And you control what else is on the table. A review rarely arrives alone. There may be a break clause approaching, a dilapidations position building, consents outstanding, or a service charge dispute running. Treating the review as a single isolated letter gives away the leverage that comes from settling several things at once.
Why the diary is the actual fix
Every one of the levers above depends on knowing the date before the letter. Preparation time is what turns a review from something that happens to you into something you run.
The businesses that handle reviews well are not better negotiators. They simply know, twelve months out, that the review is coming, which lease it sits in, what basis it is on, what the response period is, and who has to act. That knowledge is not difficult to hold. It is just nobody's job, in most businesses, until it is urgent.
What Dinmore Bell does here
Dinmore Bell holds the lease estate as a register: every property, every term, every review, break, renewal and consent, with the dates that matter and the notice requirements attached to each.
When a review approaches, Dinmore Bell reads the clause and says what basis it is on and what the assumptions do to the likely number, assembles the comparable evidence and the improvements paperwork, runs the correspondence with the landlord or their agent, and negotiates the settlement. Where the matter needs to be referred, Dinmore Bell instructs the valuer and prepares the case rather than handing you a file.
The register is the part that keeps working after the review is settled, because the next one is already in it.
Where a specialist is needed
A contested open market review turns on valuation evidence, and valuation is a surveyor's discipline. Where the number is genuinely in dispute, a chartered surveyor with local rental evidence is the right person to value it, and Dinmore Bell instructs and directs one rather than substituting for that expertise. The same is true where the matter is referred to an independent expert or arbitrator: the valuation case is a surveyor's to make.
Where a lease term is genuinely ambiguous and the meaning of the clause itself is in dispute rather than the number, that is a point for counsel, and Dinmore Bell will say so.
Dinmore Bell provides an outsourced General Counsel function for founder-led businesses, owning work of this kind end to end rather than advising on it and handing it back.
Common questions
- Can the rent go down at a review?
- Only if the clause allows it. Many commercial leases provide for upward only reviews, meaning the rent may rise or stay where it is but cannot fall, whatever the market has done since. Which kind you have is settled by the wording of the clause, so that is the first thing to establish.
- What happens if I miss the response period?
- Rarely does the landlord simply get their figure. What usually happens is that your options narrow: the ability to appoint your own valuer, to put your own evidence forward, or to trigger a referral yourself. Those are the levers that improve the outcome, so losing them costs money even when nothing is imposed.
- Should the fit-out we paid for increase our rent?
- Frequently the clause says it should not, by disregarding tenant improvements. Whether that applies to your improvements depends on the wording and on being able to evidence what you did and when. The licence for alterations, the specification and the invoices are what make the argument, so they are worth finding before the review rather than during it.
- Is it worth going to an independent valuer?
- Sometimes, and the credible possibility of it is worth more than the referral itself. Referral costs both parties money and hands both an uncertain result, which is precisely why most reviews settle. A tenant who is prepared, evidenced and evidently willing to go there negotiates from a materially better position.
- How far ahead should we be looking at this?
- Twelve months is comfortable, six is workable, and the day the letter arrives is late. What you need in that time is the clause read, the basis established, the comparable evidence gathered and the improvements paperwork found, none of which is difficult and all of which takes longer than the response period allows.
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