Industrial property lease

About this document

This lease has been drawn to let a an industrial use building such as a workshop or a warehouse, where the landlord is likely to be a property developer or an institutional real estate investor and requires more technical provisions than those found in our standard leases.

It has been designed to maximise the capital value of the let property and to provide acceptable security to a bank or another lender. The interest of the landlord always comes first.

Similar agreements

There is no provision for service charge recovery in this document. If you need this, perhaps because the unit shares services with others forming a small business park, see this lease.

If the property will be used as offices, our lease for an office building may be more appropriate.

If the property is mainly land, with plant or buildings, a lease for land may be more appropriate.

Key features

Plain English is used throughout except where it is necessary to use legal terms common in this field of law.

The key features of this template can be summarised as:

• term between 1 and 30 years, that is, any usual commercial term (short-term by default)
• for long term leases that require registration, prescribed lease clauses (PLCs) can be added easily
• guarantor
• assignment
• no sub-letting
• break provision
• rent review options
• opt-out of Sections 24-28 of the LTA 1954
• draft authorised guarantee agreement: enables you to use the opt-out provisions of the 1995 Act
• template for a security deposit agreement

This is one of a collection of commercial lease templates designed for use by property professionals. Accordingly, the provisions are very thorough.

If you are not familiar with commercial property leases, you may wish to look at the standard version, which contains fewer of the technical aspects, fewer warranties, and no references to prescribed lease clauses.

We have also included the forms required to exclude security of tenure. These include the prescribed notices to be given to the tenant 14 days before the new lease is created, a declaration of a new lease, and the statutory declaration if less than 14 days notice is given.

The law in this lease

Commercial lease law is regulated primarily by the Landlord and Tenant Act 1954, amended many times. Account has also been taken of:

• the Landlord and Tenant (Covenants) Act 1995
• the Regulatory Reform Regulations 2003
• the Joint Committee's Code for Leasing Business Premises
• the RICS' Code on Service Charges

Contents

This lease is comprehensive, providing alternative choices for important decisions. The contents of the lease include 29 provisions and 3 schedules covering:

• rent: amount, other payments, interest on overdue rent, periodic review
• condition and repair
• alterations with landlord's consent
• tenant's positive obligations
• restrictions on tenant
• goods and vehicles
• assignment
• preconditions for further development
• indemnities by the tenant and warranties by the landlord
• land registration
• security deposit
• insurance
• access for landlord
• guarantor
• termination: default notice by landlord; provision for premature termination
• forfeiture
• security of tenure excluded
• Schedule 1: rights reserved
• Schedule 2: draft authorised guarantee agreement
• Schedule 3: security deposit agreement
• Prescribed notices to be sent to tenant

If the term of your lease is for more than seven years, it must be registered with the Land Registry. We provide prescribed lease clauses (PLCs) for long term leases free of charge. There are instructions on how to add these within the document. There is no need to use these if your intended term is seven years or shorter.