Fair Play or Foul Call? What the UK Ban on Upward‑Only Rent Reviews Means for Business Tenants
Fair play is part of the British DNA. We love a level playing fieldbe it in sport, business, or public life. We celebrate effort, reward merit, and (at least in theory) believe that the game should be winnable for both sides. That’s why the Government’s proposed ban on upward-only rent review (UORR) clauses feels both overdue and controversial.
As a chartered surveyor who works daily to help businesses exit or renegotiate leases, this marks a significant pivot point in our market. When I worked at as rent review surveyor for UK and IRL rent reviews, I remember being struck by how Ireland made the same bold move way back in 2010 banning upward‑only reviews in business leases under the Land and Conveyancing Law Reform Act 2009.
📊 What’s Changing?
Ban covers “new” and “renewal leases” in England & Wales, old ones stay unchanged, but statutory renewals under the Landlord & Tenant Act 1954 will now fall in scope.
Rigid upward-only reviews prohibited - landlords must offer fixed rents or full up/down market reviews.
Anti-avoidance measures includes to block rerouting clauses such as collars or landlord-only triggers ( to be detailed later)
💡 Why This Matters
For tenants: welcome relief from locked-in rent hikes , especially in high street retail occupiers lately which is great news for small businesses squeezed by steadily increasing costs.
For landlords: loss of predictability. UORRs traditionally offered comfort in long-term planning and valuation. Now, landlords must embrace market volatility.
Market dynamics shift: this could lead to higher initial rents or fixed stepped increases as landlords protect themselve an unintended trade-off.
A Look at Ireland: A Decade Ahead
Ireland’s experience offers valuable lessons:
After the 2010 ban, collars, caps, and “landlord-only reviews” emerged but the legislation ensures true up/down rent assessment.
Court rulings from IRL show that we might expect this proposal to contested in the courts as it was in Ickendel Ltd v Bewley’s Café Grafton Street Ltd [2014] where the contractual agreements (upward only) prevailed over the rule change.
👍 Why I Welcome This
As a society, we’ve become enamoured with the idea that numbers must always go up rents, yields, values. But in the real world, nothing increases forever. Markets fluctuate. Allowing both upward and downward rent reviews brings realism back into rent review negotiations.
It creates a healthier, more sustainable market where rent reflected on rent review memoranda resembles more of the market rent.
⚠️ Caveats, Pushback & What’s Missing
I completely understand why this proposal is ruffling feathers and not just because of the policy itself.
🔸No prior consultation took place before the announcement highly unusual for such a significant commercial property reform.
🔸 It was introduced somewhat “under the radar”, “buried” within the English Devolution and Community Empowerment Bill, which most wouldn’t expect to commercial reny review changes.
🔸 I speak to many landlords and institutional groups and their reps that feel blindsided by this approach, especially those who rely on predictable valuations and financial planning tied to UORR clauses.
Good regulation is transparent, consultative, and considerate of all stakeholders. This sudden insertion risks eroding trust, even among those who may agree with the direction of travel.
🔍 What does this mean for protected leases?
For statutory renewals under the Landlord & Tenant Act 1954, especially with O’May principles applying to terms how will courts treat existing UORRs?
Will tenants be able to argue for full market-based rent review clauses on renewal?
Will landlords still try to retain UORR clauses by arguing they reflect the previous lease?
Could this trigger disputes around what constitutes a “reasonable modern term” under s.35?
🔍 What You Should Do Now
1. Audit your leases: Know which are already under UORR and what’s happening on renewal.
2. Negotiate carefully: For any upcoming lease, balance rent flexibility with sustainable terms think collars, caps, or stepped structures.
3. Stay alert: The Bill is still moving through Parliament expect amendments, lobbying, and legal debates around scope and enforcement.
🧭 Final Perspective
As a surveyor and adviser, I believe this is a healthy evolution. It may bring short-term volatility, but in the long run, it may have the effect of aligns price to value, giving all parties a fairer deal.
I know process matters and forewarning helps businesses but I believe this change will bring long-term benefit, but its top-down delivery without consultation or visibility may compromise how it's received.
If you’re weighing up lease structures, reviewing renewal strategy, or want to chat about preparing for these changes, I’d love to help.