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Long Term Commercial Lease UK: Tenant Guide 2025

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Part ofUK Property Law Guide

Written by Brad Askew Solicitor (non-practising)
Brad is on the roll of solicitors of England & Wales but does not hold a practising certificate and does not provide legal advice.
Updated June 2026 · England & Wales
Signing a long term commercial lease is one of the bigger commitments a business can make. A lease running for five, ten, or fifteen years shapes your overheads, your flexibility, and in some cases your ability to grow or move. Getting the terms right at the outset matters far more than most tenants realise, because once the ink is dry, changing direction can be expensive. This guide walks through how long term commercial leases work in England and Wales, the different structures you might be offered, the clauses that tend to cause the biggest headaches, and the questions worth asking before you sign. Whether you are taking a whole building, part of a floor, or subletting from an existing tenant, the principles below should help you see what you are dealing with and where to push back.

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

Q What counts as a long term commercial lease?
There is no single legal definition, but anything granted for more than five years is generally treated as long term in commercial property practice. Terms of ten or fifteen years remain common for offices and industrial units. Leases granted for more than seven years must be registered at HM Land Registry, which creates a public record of the tenant's interest in the property.
Q What is an upward only rent review?
An upward only rent review means the rent can rise at each review date but cannot fall, even if market rents have dropped. Reviews typically happen every five years and may be set by reference to open market value or an index like CPI. For tenants, this can be a significant commitment, so it is worth understanding exactly how the review will be calculated.
Q Can I get out of a long term lease early?
Only if the lease contains a break clause you can exercise, or if you can negotiate a surrender with the landlord. Break clauses usually require strict conditions to be met, such as giving notice in a specific form and having paid all rent on time. Missing a condition can invalidate the break, so the timing and drafting matter a great deal.
Q What is a full repairing and insuring lease?
An FRI lease puts responsibility for repairs, maintenance, and the cost of insurance onto the tenant, even where the property was in poor condition at the start. On a lease of part, these costs are often recovered through a service charge. Tenants can limit exposure by agreeing a schedule of condition, which caps the obligation to the state of the property when they took it on.
Q Do I have a right to renew my business lease?
If your tenancy is protected by the Landlord and Tenant Act 1954 and you occupy for business purposes, you generally have a statutory right to renew on broadly similar terms. The landlord can only refuse on specific grounds. Many landlords insist on contracting out of this protection before the lease is granted, so it is important to check your position early.
Q What is the difference between assigning and subletting?
Assigning means transferring the lease to a new tenant who steps into your shoes. Subletting means granting a separate, shorter lease of the premises or part of them to another occupier while you remain the head tenant. Most commercial leases restrict both, usually requiring the landlord's consent, so the exact wording of the alienation clause is important.
Q Does stamp duty apply to commercial leases?
Stamp Duty Land Tax can apply to the grant of a commercial lease in England and Northern Ireland, based on rent and any premium paid. In Wales, Land Transaction Tax applies instead. The amount depends on the value of the lease over its term. Check gov.uk for current thresholds and rates before completing, as this is a cost tenants often overlook.

Sources

This guide is based on primary UK law and official guidance.

Brad Askew, Solicitor (non-practising)

Written & reviewed by

Brad Askew Solicitor (non-practising)

Brad is on the roll of solicitors of England & Wales but does not hold a practising certificate and does not provide legal advice. LegalDocuments.co.uk is not a law firm and does not provide regulated legal advice.

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Legal disclaimer
This article is for general information only. It is a tool to help you find your way — not legal advice, and not a substitute for speaking to a qualified adviser about your situation.