Renewing and Ending a Commercial Lease

If your commercial lease is coming to an end, you may be hoping to renew the contract. Alternatively, you may be ready to terminate the lease, or even want to end the tenancy agreement early. We take a look at each of these scenarios in turn, guiding you through the different options available to you.

Renewing a Commercial Lease in Scotland

The terms and conditions set out in the lease are of the utmost important in Scotland, as it is these which determine the rights of both landlord and tenant. Therefore when it comes to renewing a lease, your ability to do so will be set out in the terms of the lease, which is regarded as a legally-binding contract.

For example, when the lease is drafted, it is possible to include a clause stating that a lease will be automatically repeated. If there is no such clause, a tenant has absolutely no right to have the lease renewed. If a tenant does wish to continue in the same business premises, it will be necessary for him/her to enter into negotiations with the landlord. This should be done prior to the lease ending.

Ending a Commercial Lease in Scotland

On the other hand, many fixed-term agreements will be instantaneously renewed at the end of the lease. If a tenant does not wish to proceed with the same commercial lease at the end of the fixed term, he/she must inform the landlord at least 28 days in advance. Otherwise, the tenancy may be automatically repeated, and a tenant will be liable for the property for the length of the fixed term agreement.

Thus it is vital to ensure you are fully aware of the terms set out in the lease, or you could find yourself in the unfortunate position of:-

• Failing to renew a lease, even though you wished to do so;
• Failing to end a lease, meaning you must continue to pay rent for another six months (or however long the fixed-term agreement is).

Early Termination of a Commercial Lease in Scotland

In Scotland, tenants do not have the right to terminate a commercial lease before the specified date. However, there are several ways in which you can free yourself of a commercial lease before the contract comes to an end. These include:-

• Assigning or subletting the lease to another tenant;
• Using a break clause to terminate the lease;
• Asking the landlord to accept a surrender of the lease.

Early Legal Advice

Whether you wish to renew or end a commercial lease, it is essential you seek early legal advice from McKay Norwell. We have a team of commercial property solicitors whose professional expertise and legal knowledge will ensure that whether you are renewing or ending a lease, your best interests will be taken care of. From negotiating the terms of a renewal to helping you terminate a contract, we promise to handle your legal query in a friendly but efficient manner.

Simply call us for a free assessment immediately on 0131 222 8000 or complete the enquiry form on the right of this page and we will be delighted to help you.

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