Commercial Lease Renewals and Extensions
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Commercial Lease Renewal & Extensions Solicitors
At Clifford Johnston & Co, our expert Commercial Lease Solicitors provide strategic advice on lease renewals and extensions, protecting your interests and unlocking value in every negotiation. Whether you’re a landlord or tenant, the approach you take to renewing or extending a commercial lease can have lasting consequences for your property, your rights, and your financial position.
With over 35 years of experience advising businesses and investors across Manchester, Stockport and the North West, we understand the legal complexities and commercial sensitivities involved in every lease negotiation. We act for a wide range of commercial clients including retailers, industrial occupiers, office tenants, healthcare providers, and portfolio landlords, guiding them through both statutory renewals under the Landlord and Tenant Act 1954 and bespoke lease extension deals (regears) outside the Act.
We hold accreditation under the Law Society’s Conveyancing Quality Scheme (CQS), recognising our commitment to high standards in legal practice and client service. Our work is defined by clarity, efficiency and a focus on achieving results.
We are known for our meticulous attention to lease structure, risk allocation and long-term enforceability. From early position reviews to formal notices, break clauses, rent negotiations and service charge liabilities, our team ensures you are fully advised on your legal position and negotiating leverage from day one.
How Can We Help With Your Commercial Lease Renewal or Extension?
At Clifford Johnston & Co., we act as trusted advisors to businesses and landlords dealing with lease renewal or extension decisions that can shape their long-term operational or investment strategy. Whether you’re looking to secure a new lease under the protection of the 1954 Act or regear an existing arrangement on more favourable terms, our solicitors provide expert guidance to help you protect your position and maximise commercial flexibility.
We act for landlords and tenants across Stockport, Manchester and beyond, advising on everything from statutory notices and court applications to tactical lease restructures. We combine legal precision with commercial insight to ensure that the lease extensions/renewal terms you agree today won’t create problems tomorrow.
We begin with a detailed legal position review to clarify your rights, risks and available options. We’ll advise on the optimal legal route, manage notice deadlines and statutory processes, and negotiate key lease terms such as rent, repair obligations, break rights and service charge liabilities.
Our solicitors routinely assist with:
- Reviewing leases and identifying critical dates, risks and leverage points
- Advising on renewal rights under the Landlord and Tenant Act 1954
- Negotiating lease extensions, regears and reversionary leases
- Managing surrender and regrant arrangements
- Drafting and negotiating lease terms to align with long-term commercial objectives
Each lease negotiation involves different commercial and legal pressures, whether that’s preserving business continuity, unlocking investment, or navigating redevelopment risk. We take the time to understand your business and your property strategy so that our advice is commercially focused, legally watertight, and tailored to your goals.
If you’re considering renewing or extending a commercial lease, speak to our commercial property team today. We’ll provide the clarity and strategic support you need to move forward with confidence.
What are lease renewals and extensions?
Lease renewals and lease extensions may sound similar, but legally they involve very different processes, and choosing the right approach at the outset can have a major impact on timing, cost, negotiating power and long-term risk.
A lease renewal typically refers to a business tenancy protected under the Landlord and Tenant Act 1954. If your lease is “inside the Act”, your right to occupy doesn’t automatically end when the lease expires. Instead, you may have a statutory right to renew, with the process governed by strict rules, notices and court procedures. Either the landlord or tenant can trigger the renewal, and the new lease terms, including rent, term length, and obligations are subject to negotiation or determination by the court.
A lease extension, often called a lease regear, is a more flexible, commercial negotiation that falls outside the 1954 Act framework. This usually involves the parties agreeing to change the term or other lease terms during the life of the lease, often in exchange for concessions such as a rent adjustment, removal of a break clause, or capital contribution. Extensions can be documented via a deed of variation, a reversionary lease, or a full surrender and regrant, each with different legal, tax and registration consequences.
Understanding whether your lease is protected under the 1954 Act and what your objectives are is critical. Our solicitors advise at the earliest stage to assess your position, preserve your rights, and ensure the most appropriate and cost-effective route is taken. Whether you need to preserve continuity of occupation or reshape a lease for strategic reasons, we’ll guide you through the legal complexities with clarity and confidence.
The commercial lease renewal and extension process
Whether you’re a landlord looking to protect asset value or a tenant seeking business continuity, the process of renewing or extending a commercial lease involves important legal and tactical steps. Choosing the correct route, either a statutory renewal under the Landlord and Tenant Act 1954 or a negotiated extension, can significantly affect timing, leverage and long-term obligations.
Initial Legal Review
The first step is a detailed position check by your solicitor. We’ll clarify:
- Whether the lease is inside or outside the 1954 Act
- Who the competent landlord is
- Key dates: lease expiry, rent review, break rights, and notice deadlines
- Any existing breaches, arrears or repair issues that could affect negotiations
This review often dictates your options and should happen 9–12 months before the lease ends.
Route One: Statutory Lease Renewal
If the lease is protected under the 1954 Act, the renewal process is usually triggered by a Section 25 notice (from the landlord) or a Section 26 request (from the tenant). These notices must comply with strict formalities and notice periods, so timing is crucial.
Once served, the parties enter into negotiations over the new lease terms. Common issues include rent, term length, repair liabilities, service charges, and break clauses. If agreement can’t be reached, either party can apply to the court to settle the terms or determine whether renewal should be granted.
A landlord can only oppose renewal on specific statutory grounds, such as tenant breaches or planned redevelopment.
Route Two: Lease Extension or Regear
Outside the statutory framework, many parties opt for a negotiated lease extension or regear. This is often faster and more commercially flexible, especially where both parties want to reshape the lease terms before expiry.
There are several legal structures available:
- Deed of variation to extend the term
- Reversionary lease (a new lease that starts in the future)
- Surrender and regrant of a new lease (which can affect security of tenure and guarantor obligations)
Your solicitor will advise on the legal, tax and Land Registry implications of each route, ensuring your commercial objectives are met without triggering unnecessary liabilities.
Finalising Terms and Registration
Once terms are agreed, we will draft or review the lease documentation, liaise with all parties (including lenders if required), and ensure the agreement is correctly executed and registered. Where appropriate, we will also manage SDLT submissions and serve any further notices needed.
At Clifford Johnston & Co., we manage the entire process with precision, ensuring you meet deadlines, avoid pitfalls, and secure the most favourable outcome possible. Whether you’re planning ahead or responding to a notice, we’ll give you the clarity and support you need every step of the way.
What is the right of renewal on a commercial lease?
The right of renewal refers to a tenant’s legal entitlement to request a new lease when the current one ends, provided the lease is protected under Part II of the Landlord and Tenant Act 1954. This right ensures that eligible business tenants can continue occupying the premises on broadly similar terms, subject to rent and conditions being renegotiated.
To exercise this right, the tenant must serve a formal Section 26 notice, or the landlord may trigger the process with a Section 25 notice. The right to renew can only be refused by the landlord on specific statutory grounds, such as redevelopment or serious breaches by the tenant.
If your lease is “contracted out” of the 1954 Act, you will not have this automatic right and must rely on negotiating a new agreement. Our solicitors will advise you on your position and help protect your occupation or asset value, depending on your side of the lease.
Commercial Lease Renewal & Extension FAQ’s
Does a commercial lease automatically renew?
No, a commercial lease does not automatically renew when it reaches its end date, unless the lease is protected under the Landlord and Tenant Act 1954 and neither party has taken formal steps to end or renew it. In that case, the lease continues under the same terms until it is brought to an end by proper notice.
If the lease is “contracted out” of the Act, it will expire on the end date with no right to remain or renew unless a new agreement is negotiated. It’s essential to know your lease status well in advance of expiry. Our commercial lease solicitors can advise on your legal position and ensure you take the right steps at the right time to protect your interests.
How much does it cost to renew a commercial lease?
The cost of renewing a commercial lease varies depending on several factors, including the complexity of the negotiation, whether the lease is protected under the Landlord and Tenant Act 1954, and whether agreement is reached amicably or through court proceedings.
Typical costs may include:
- Legal fees for drafting and negotiating the new lease terms
- Valuation or surveyor fees if rent is being reviewed or contested
- Stamp Duty Land Tax (SDLT) if the new lease is treated as a new tenancy with a chargeable premium or rent
- Land Registry fees, where the lease requires registration
Each case is different. At Clifford Johnston & Co., we provide clear, upfront pricing and will advise you on likely costs from the outset, helping you plan and budget with confidence.
How expensive is it to extend a lease?
The cost of extending a commercial lease depends on the nature of the agreement and how the extension is documented. Unlike statutory renewals under the Landlord and Tenant Act 1954, lease extensions are typically negotiated deals (known as regears), which can vary widely in complexity and cost.
Key cost factors include:
- Legal fees for drafting or reviewing a deed of variation, reversionary lease, or surrender and regrant
- Valuation fees, if rent or other terms are being renegotiated
- Stamp Duty Land Tax (SDLT), which may apply depending on the rent, premium, and length of the term
- Land Registry fees if the lease is registrable
- Lender consent costs, if the property is charged
In many cases, an extension is part of a broader commercial negotiation, for example, removing a break clause or securing investment from the landlord. Our solicitors will advise you on the most cost-effective legal route and ensure there are no hidden financial risks in the structure or drafting.
Can a landlord refuse to renew a commercial lease?
Yes, but only in limited circumstances. If the lease is protected under the Landlord and Tenant Act 1954, the landlord can only refuse renewal on specific statutory grounds set out in Section 30 of the Act. These include:
- Tenant breaches, such as failure to maintain or persistent rent arrears
- The landlord’s intention to occupy the property for their own use
- Plans to redevelop the premises that require vacant possession
If the landlord relies on a “no fault” ground, such as redevelopment, the tenant may be entitled to statutory compensation based on the rateable value of the property.
However, if the lease is outside the 1954 Act (i.e. properly “contracted out”), the landlord can refuse to renew for any reason and is under no obligation to grant a new lease.
It’s crucial to understand your legal position early. Our solicitors can advise on whether your lease is protected, what rights you have, and how to respond to a refusal.
What happens if I miss the deadline to serve a renewal notice?
Missing the deadline to serve a renewal notice under the Landlord and Tenant Act 1954 can have serious consequences, particularly if you’re a tenant with a protected lease. If you do not serve a Section 26 request in time and the landlord serves a valid Section 25 notice (or vice versa), you may lose your statutory right to renew once the notice period expires.
If no notice is served by either party and the lease expires, a protected tenancy may continue by law (a “holding over” period), but this is precarious and time-limited. Delay can weaken your negotiating position or, worse, lead to eviction if proper steps aren’t taken in time.
If your lease is outside the 1954 Act, there is no statutory right to renew, and once the lease ends, your right to remain ends with it.
That’s why early legal advice is essential. Our commercial lease solicitors can review your lease, advise on all critical dates, and ensure your rights are preserved through timely and correct notice procedures.
Can I negotiate terms even if I have a statutory right to renew?
Yes, having a statutory right to renew under the Landlord and Tenant Act 1954 does not mean you must accept the same terms as your previous lease. While your right to a new tenancy is protected, the terms of that new lease, including rent, length of term, repairing obligations, service charges, and break clauses, are subject to negotiation between you and the landlord.
If agreement can’t be reached, either party can apply to the court, which will decide the terms based on market conditions and reasonableness. However, most renewals are resolved by negotiation before court proceedings become necessary.
Our solicitors will help you identify which lease terms may need adjusting, assess market comparables, and negotiate on your behalf to secure favourable conditions, while ensuring your statutory rights remain protected throughout the process.
What is a surrender and regrant, and how does it work?
A surrender and regrant is a legal process where the tenant and landlord agree to end the existing lease and immediately enter into a new one, often with revised terms such as an extended lease length, updated rent, or changed repairing obligations.
This approach is commonly used when the changes are so substantial that they can’t be made through a simple deed of variation. It offers a clean break from the old lease and creates a brand-new agreement, but it also carries legal and tax implications.
Key points to consider include:
- Security of tenure may be lost unless the new lease is properly protected under the 1954 Act
- Guarantors and lenders may need to re-approve the arrangement
- The new lease may trigger Stamp Duty Land Tax (SDLT) and require Land Registry registration
At Clifford Johnston & Co., we advise clients on whether a surrender and regrant is appropriate and ensure it is structured to reflect your commercial intent while avoiding unintended consequences.
What is a deed of variation and how is it used?
A deed of variation is a legal document used to amend the terms of an existing commercial lease without ending the lease itself. It’s often used to extend the lease term, adjust the rent, change repairing obligations, or update other key clauses to reflect new agreements between the landlord and tenant.
While a deed of variation can seem like a simple option, it must be used carefully. In some cases, particularly where the lease term is extended, it may be treated in law as an implied surrender and regrant, which can trigger tax liabilities, registration requirements, or unintended changes to your rights (such as security of tenure under the 1954 Act).
Our solicitors will advise you on when a deed of variation is appropriate, draft or review the document, and ensure it’s correctly executed and compliant with all legal and commercial obligations.
Will I need to pay Stamp Duty Land Tax on a lease extension?
Yes, extending a commercial lease can trigger Stamp Duty Land Tax (SDLT), depending on the terms of the extension. HMRC treats a lease extension as a new lease for tax purposes, particularly where additional rent is payable or the term is significantly extended.
The amount of SDLT due will depend on several factors, including:
- The length of the new term
- The rent payable over the extended period
- Whether any premium is being paid
In some cases, especially with surrender and regrant or reversionary leases, the SDLT implications can be complex and unexpected. That’s why it’s vital to assess the tax position in advance.
Our commercial property solicitors in Manchester and Stockport work closely with tax advisers and will ensure that your lease extension is structured efficiently, fully compliant with SDLT rules, and properly reported to HMRC where required.
Do I need landlord consent to assign or sublet after a lease renewal or extension?
In most commercial leases, yes, you will typically need the landlord’s written consent to assign (transfer) the lease or sublet the premises, even after a renewal or extension. These restrictions are usually set out in the lease’s alienation provisions and are commonly carried forward into the renewed or extended lease.
The landlord cannot unreasonably withhold consent in most cases, but they may impose conditions, such as requiring an Authorised Guarantee Agreement (AGA) on assignment or limiting subletting to part only.
When negotiating a lease renewal or extension, it’s a good opportunity to revisit and potentially relax these restrictions to give your business more flexibility in the future. Our solicitors can advise you on your rights, help negotiate fairer terms, and ensure any changes are clearly documented in the new lease.
How long does the commercial lease renewal process take?
The commercial lease renewal process typically takes between 3 to 12 months, depending on the complexity of the negotiation and whether the renewal follows the statutory route under the Landlord and Tenant Act 1954.
If the process is straightforward and both parties agree on the terms early, it can be completed in a matter of months. However, if disputes arise over rent, lease terms, or if court proceedings are required, the process can take significantly longer.
Statutory notice periods also play a role. For example, a Section 25 or Section 26 notice must give between 6 and 12 months’ notice, and court timetables can further extend the timeline.
To avoid delays and preserve your legal rights, we recommend seeking advice at least 9 to 12 months before your lease is due to expire. Our solicitors will help manage the entire process efficiently and keep your interests protected throughout.
Contact Our Commercial Lease Renewal and Extension Solicitors
Renewing or extending a commercial lease is more than a formality, it’s a strategic opportunity to safeguard your business, strengthen your negotiating position, and avoid costly obligations in the years ahead. At Clifford Johnston & Co., our expert commercial lease solicitors provide clear, commercially focused advice to both landlords and tenants, ensuring every renewal or extension reflects your long-term goals and legal rights.
We handle the full spectrum of lease renewal and extension matters, including statutory renewals under the Landlord and Tenant Act 1954, regear negotiations, deeds of variation, surrender and regrant structures, and the complex legal and tax implications that come with each. Our commercial property solicitors work closely with property agents, valuers, and lenders to deliver a joined-up, efficient service from first instruction to registration.
Whether you’re a business owner seeking security of tenure or a landlord managing your asset strategy, we will guide you through the legal process with clarity, confidence, and tactical insight. Every lease is different and so is our approach. We tailor our advice to your position, your property, and your commercial objectives, keeping you fully informed and in control throughout.
With over 3 decades of experience advising clients on commercial property matters across Manchester, Stockport and the wider North West, Clifford Johnston & Co. is recognised for our technical expertise, robust negotiation and practical results. Our accreditations and longstanding client relationships reflect our commitment to exceptional service and legal excellence.
Contact our Commercial Lease Renewal and Extension Solicitors today for expert advice and trusted legal support. We are here to protect your interests and help your business move forward with certainty.
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