The benefits of a break clause in a commercial lease
A break clause in a commercial lease can be extremely useful for a tenant. Exercising the break clause allows the tenant to bring the lease to an early end. This may be necessary because the circumstances of the tenant’s business have changed. It may simply be that alternative premises are available at a better price.
A recent High Court decision emphasises that the tenant must comply in full with any conditions to the exercise of a break right. Tenants should take great care to check these conditions. If the tenant does not comply properly with the conditions, then the break will not be effective and the lease will continue.
Barker Gotelee can provide a checklist of practical points that may be relevant when a tenant wants to exercise a break clause. If you would like a copy of this checklist or any other advice about commercial leases, please contact Toby Pound, partner and head of the Property department at Barker Gotelee.