Security of tenure for commercial leases
Most tenants of commercial premises with a lease of more than 6 months, or if they have been in occupation for more than twelve months, have security of tenure. This means that they have the right to continue to occupy the premises after the lease has come to a natural end on similar terms to the original lease.
This protection is given by the Landlord & Tenant Act 1954:
- Part I Security of Tenure for Residential Tenants.
- Part II Security of Tenure for Business, Professional and other Tenants.
Security of tenure can be important for commercial tenants, for example; if they have installed a lot of equipment, If the location is vital to their operation, if business continuity is important and so on.
If negotiations to permit continued occupation fail at the end of the original lease, the tenant can apply to the Court for a new lease.
- If the tenant has not carried out repair and maintenance obligations.
- Persistent delay in paying rent.
- Other substantial breaches of obligations under the tenancy, or any other reason connected with the tenant’s use or management of the holding.
- The landlord has offered alternative suitable accommodation.
- The tenant is a sub tenant of part of the premises, and the landlord would be able to get more rent if they leased the entire premises.
- The landlord intends to demolish or reconstruct the premises.
- The landlord intends to occupy the premises.
The landlord and the tenant can agree to exclude, or ‘contract out’ the right to security of tenure, giving the landlord automatic possession at the end of the lease. This might be agreed, for example, if the landlord intends to redevelop the premises, or to occupy it themselves, or they may simply want flexibility at the end of the lease. See Statutory declaration excluding security of tenure for more information.
 Related articles on Designing Buildings Wiki
- Break clauses in leases.
- Ground rent.
- Landlord and Tenant Act.
- Lease Negotiations - Tenants Checklist.
- Penal contractual terms.
- Rent-free period.
- Rent in administration.
- Rent review.
- Sample retail lease.
- Service charge.
- Statutory declaration excluding security of tenure
- Vacant possession.
 External references
- The Landlord & Tenant Act 1954.
- Ashurst, Business Tenancies: Contracting out of the Landlord and Tenant Act 1954.
Featured articles and news
Estimates suggest that up to 30,000 small firms could be at risk of non-payment as a result of Carillion's collapse.
Sir Oliver Letwin to lead an independent review into the delays in the delivery of housing.
As Carillion collapses, read our article explaining insolvency in the construction industry.
43,000 jobs at risk as Carillion goes into administration.
1961 saw the publication of three important books about urban design that remain relevant today.
Next week the planning fee increases by 20% and new fees are introduced.
How the transformative power of BIM and other digital technologies can be used to gain a competitive edge.
Relevant events and relevant matters are terms used in some contracts, but knowing the differences is important.
Government release statistics showing how many people are now on the property ladder due to Help to Buy schemes.
A summary of the Town and Country Planning Association's new Practical Guide on health in garden cities.
We have launched a new adaptive site that makes Designing Buildings Wiki easier to use on tablets and mobile phones.