LEASE Law can also assist landlords who are considering negotiating an informal lease extension with their tenant.
Am I required to grant a lease extension to the tenant?
You are not required to grant an informal lease extension to a tenant, however, if you do not agree an informal lease extension then, subject the tenant satisfying the qualifying criteria, the tenant can serve a formal statutory notice on you as the landlord to commence the statutory lease extension procedure and you will then be required to grant the tenant a lease extension through the statutory process.
Why should I agree to extend my tenant’s lease informally?
If you agree to extend your tenant’s lease informally, the procedure is usually quicker and you will therefore receive the premium payment a lot sooner. In addition, as the tenant is usually in a position where they would like to complete the lease extension quickly, you can usually agree a higher premium without paying additional negotiation costs to your valuer.
What terms do I have to offer the tenant for an informal lease extension?
When you informally agree an extension of the lease with your tenant, you can agree any terms between you, including the length of the lease extension and the amount of the ground rent. We would advise that you instruct a specialist lease extension valuer at the outset to provide their advice as to the terms of the lease extension to offer the tenant.
What is the cost to me of the lease extension?
The tenant will usually agree to pay your reasonable costs in connection with the lease extension which will include your legal costs and valuation costs. You should obtain specific agreement in the form of a formal undertaking from the tenant’s solicitor that the tenant will be responsible for your costs before you incur any.
How long will it take to grant the lease extension?
As the terms of the lease extension are already agreed once we are instructed, it should only take a number of weeks to complete the lease extension (depending on how responsive the tenant/their solicitors are).
What is the procedure for granting the lease extension?
As the terms of the lease extension have already been agreed once your solicitor is instructed, as your solicitor, we will investigate the title to the subject property, draft the lease for the approval of the tenant’s solicitor and negotiate the terms of the draft lease until it is agreed form.
Once the lease is in agreed form, then the lease will need to be signed on behalf of both parties (and any third party to the lease). Once these formalities have been carried out, the premium and costs will be paid by the tenant’s solicitors and the lease extension will be completed.
How can LEASE Law help me?
LEASE Law are specialist solicitors who can act on your behalf in respect of the legal requirements for granting the lease extension to your tenant. LEASE Law will recover their fees from the tenant.
We can also recommend specialist lease extension valuers who have extensive experience and expertise in this area to ensure that the premium that you receive for the lease extension is as high as possible. Your valuer will provide you with an initial report which will advise you on the terms of the lease extension that you should offer to your tenant for an informal lease extension.
If you would like Lease Law Limited to assist you, please contact Jade Thomas (firstname.lastname@example.org or 0204 511 9100) or Joanna Botley (email@example.com or 0204 511 9101) for a no obligation discussion.