Long Term Commercial Lease UK: Tenant Guide 2025

What this document is

In commercial property terms, a long term lease usually means any lease granted for a period longer than five years, though in practice terms of ten, fifteen, or twenty years remain common for office, retail, and industrial premises. The lease is a binding contract between landlord and tenant that grants exclusive possession of the premises in return for rent and compliance with a set of obligations known as covenants.

Unlike short lettings, a long term lease tends to be heavily negotiated. It will typically include detailed provisions on rent reviews, repair standards, permitted use, alterations, alienation (your ability to assign or sublet), and the circumstances in which either party can bring the lease to an early end.

Many business tenancies also fall within the security of tenure regime under the Landlord and Tenant Act 1954, which gives the tenant a statutory right to renew at the end of the term unless that protection has been formally excluded before completion. Because the document will govern your occupation for years, each clause deserves careful thought.

How to use this document

1. Work out what you actually need from the premises. Before you start negotiating, be clear on how long you realistically need the space, what kind of fit-out or alterations you will want to make, and whether you need room to expand or contract. A five year certain term with a break clause works very differently from a fifteen year term, and the choice affects rent, incentives, and your exposure if the business changes. 2. Understand the lease structure being offered. Commercial leases come in several shapes: a lease of the whole building, a lease of part with a service charge for shared areas, or an underlease granted out of an existing tenant's interest. Each brings different obligations around repair, insurance, and common parts, so make sure you know which model applies before you get into the detail. 3. Scrutinise the rent review and break provisions. Long leases almost always contain a mechanism for adjusting the rent, often upwards only at five yearly intervals, and sometimes linked to an index or open market value. Break clauses let one or both parties end the lease early but are notoriously strict on conditions. These two areas are where tenants most often get caught out, so read them line by line. 4. Check the repair, alterations, and alienation covenants. A full repairing and insuring (FRI) lease puts the burden of maintenance squarely on the tenant, which can be a significant liability at the end of the term. Equally, you need to know whether you can alter the premises, assign the lease to a buyer of your business, or sublet part of the space if circumstances change. Restrictive wording here limits your options later. 5. Consider security of tenure and what happens at the end. If the Landlord and Tenant Act 1954 protections apply, you may have a statutory right to renew when the term expires. If the landlord has insisted on contracting out of those rights, you will need to vacate or negotiate a fresh lease on whatever terms are offered. Understanding this position early prevents nasty surprises later.

Common questions