The Rent Review Specialist
Rent
Rent is a system of payment for the temporary use of something owned by someone else; the payments for such use are typically referred to as "rent".
In the open market, rent is a product; it does not occur naturally, as in, ‘this is the rent for the premises’. To value rent, all the terms and conditions of the tenancy must be known, stated in advance or defined. However, because the rent at a new letting is often agreed before the lease is drafted and/or approved, it is possible for a completed lease to contain terms and conditions that could produce a different rent to what was agreed. The test of efficacy is whether the rent would be identical if there were a rent review on the same date as the term commencement.
Whether the parties agree the rent and other outline terms between themselves, or with the help of surveyors, the precise wording and phrasing of the terms and conditions is not generally discussed and agreed before lawyers are instructed.
Sometimes, with a new letting, a draft lease will be available beforehand upon which the tenant’s rental offer would be based. On renewal involving LTA54 a draft lease for uncontentious matters would normally be agreed integral to proceedings, the amount of rent and other contentious items to be agreed thereafter or left blank pending court order. Even so, because there are cost consequences the parties are unlikely to want their lawyers to engage in detailed negotiations for finalising the renewal lease before the main terms are agreed in principle. It is only usually when the matter is actually likely to end up in court that it makes sense for the parties’ surveyors to delay the question of rent and other main terms until a draft lease has been finalised. Either that, or for each agreed item to be incorporated in the draft lease, with the other matters checked to ensure no conflict between what has been agreed previously and each new item.
In the open market, rent is a product; it does not occur naturally, as in, ‘this is the rent for the premises’. To value rent, all the terms and conditions of the tenancy must be known, stated in advance or defined. However, because the rent at a new letting is often agreed before the lease is drafted and/or approved, it is possible for a completed lease to contain terms and conditions that could produce a different rent to what was agreed. The test of efficacy is whether the rent would be identical if there were a rent review on the same date as the term commencement.
Whether the parties agree the rent and other outline terms between themselves, or with the help of surveyors, the precise wording and phrasing of the terms and conditions is not generally discussed and agreed before lawyers are instructed.
Sometimes, with a new letting, a draft lease will be available beforehand upon which the tenant’s rental offer would be based. On renewal involving LTA54 a draft lease for uncontentious matters would normally be agreed integral to proceedings, the amount of rent and other contentious items to be agreed thereafter or left blank pending court order. Even so, because there are cost consequences the parties are unlikely to want their lawyers to engage in detailed negotiations for finalising the renewal lease before the main terms are agreed in principle. It is only usually when the matter is actually likely to end up in court that it makes sense for the parties’ surveyors to delay the question of rent and other main terms until a draft lease has been finalised. Either that, or for each agreed item to be incorporated in the draft lease, with the other matters checked to ensure no conflict between what has been agreed previously and each new item.