Up, Down and All Around: Your UORR Questions Answered

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Unpacking the Case - Real Estate Law Podcast 21 min 1 speaker 8 chapters transcribed 1 month ago
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What does the proposed ban on upwards‑only rent reviews (UORR) mean for existing leases?

Unknown 0:00
Hello and welcome to a newsflash episode of Unpacking the Case, the podcast by David Jones Bold, the real estate law specialist. As always, I'm joined by our head of legal training, Richard Snape. Hello and welcome to Unpacking the Case, the podcast where we break down the latest legal developments affecting the real estate sector. In today's episode we're doing something a little different. Following our recent webinar giving an update on changes to the Landlord and Tenant Act nineteen fifty four and the government's proposed ban on upwards only rent reviews, we received a huge number of questions from property professionals across the industry. It seems this topic has struck quite a chord, and it's easy to see why.
Unknown 0:43
Few proposals have the potential to reshape commercial leasing quite like the changes to rent review provisions. We've handed our audience questions over to our head of legal training, Richard Snape, and in this special Q ⁇ A episode, Richard tackles the issues that are on everyone's minds, from lease renewals, break clauses and section 25 notices, through to the finer points of index-linked reviews, turnover rents and what the future could look like. Whether you're advising on leases every day, or simply trying to understand what these developments could mean for your business, hopefully we'll answer at least a few of your questions. Let's get into it.
Unknown 1:27
Hi Richard.
Richard Snape 1:28
Hello, Lizzie.
Unknown 1:30
Hello, we are here to do a podcast going through all of the questions we didn't have time to answer on our recent webinar on the Landlord and Tenant Act, including banning upward only rent reviews. So just starting off around the 1954 Landlord and Tenant Act. Someone asking, if I renew now before this legislation, does the upward only rent review still stand?
Richard Snape 1:53
Yeah, I mean with the sort of the um retrospective provisos, which I'm sure we'll come back to, anything that happens before implementation of the legislation will you know can still have an upward on only rent review. And that won't change suddenly the legislation comes into force. Mm-hmm.
Unknown 2:12
And is it only leases agreed after the seventeenth of march twenty twenty six, but before implementation that might be called for renewed terms?
Richard Snape 2:20
No, the March the seventeenth was introduced in the House of Lords in the latter stages through its passage through Parliament as a kind of anti-avoidance provision. That's most obvious that well it's it's when you've got a tenancy renewal arrangement that was created from March the seventeenth this year onwards. then when the legislation comes into force and you exercise the tenancy renewal arrangement, then it'll have to have an if it's got a rent review, an upward only rent review won't be allowed, it'll have to be upward and downward. And the most obvious example, although it's not the only one, is is uh an option. So if it's an option to renew the lease created from March the seventeenth onwards and the renew the option is exercised after
Richard Snape 3:05
the implementation, whatever that might be, then the option if it's includes a rent review will have to be upward and downward.
Unknown 3:13
Thank you. And will granting an agreement for lease post the seventeenth of March twenty twenty six to an existing tenant counters renewal arrangements?
Richard Snape 3:21
Yeah, that's probably a tenancy renewal arrangement if it's to an existing tenant and an agreement to lease. Agreements to lease entered into prior to implementation implementation won't be subject to the upward and downward rent review, but that's probably uh tenancy renewal arrangement. So that will uh when it gets implemented post implementation. when they go into the actual lease itself, it'll be it'll be within the the legislation. I'm just thinking of something actually. I'm thinking of your favourite and mine, Colin the Caterpillar.
Unknown 3:51
Yeah. What are you thinking about it?
Richard Snape 3:55
No, I'm thinking that section twenty eight basically says if you've got an agreement between the parties, existing parties to uh you know enter into another lease then it'll be outside the the um Well, the fifty four act won't apply and therefore in those circumstances

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