02/04/2026
A rent review negotiation is not simply a conversation about numbers. For a landlord, the outcome affects asset value, investment returns, and the credibility of future letting evidence. For a tenant, it can determine whether a business remains viable in its current premises. The agreed rent will typically stand for the next three to five years, making the negotiation one of the most consequential moments in the life of a commercial lease.
Most rent review disputes do not arise because the parties hold genuinely irreconcilable views on value. They arise because one or both parties are poorly prepared, engage too late, or do not fully understand their rights and obligations under the lease. The good news is that all three of these are preventable.
This guide explains how commercial rent reviews work, how to prepare and negotiate effectively, and what options are available when agreement cannot be reached.
How does a commercial rent review work?
A rent review gives either the landlord, the tenant, or both parties the opportunity to adjust the rent at a specified point during the lease term. The mechanics of any review are governed entirely by the lease (as there is no default statutory framework for rent reviews in England and Wales), which means the lease wording is the primary document and must be read carefully before any negotiation begins.
Most commercial leases provide for an open market rent review, where the revised rent is assessed by reference to what a hypothetical willing landlord and willing tenant would agree for the property in the open market at the review date. This hypothetical transaction takes place against a set of assumptions and disregards specified in the lease.
Review dates are fixed in the lease and typically fall every three or five years. Triggering a review usually requires a formal notice from one party, and missing or mishandling that trigger can have significant consequences.
Our rent review service covers the full process from trigger to settlement, including cases where reviews have been left dormant for some time.
How should you prepare for a rent review negotiation?
Preparation is the single most important factor in achieving a good outcome from a rent review negotiation. It begins well before the review date – ideally six to twelve months in advance for a straightforward review, and earlier for complex or high-value properties.
Important steps to take include:
Read the lease
The assumptions and disregards in the rent review clause determine what evidence is relevant and how the hypothetical open market transaction should be framed. Parties who negotiate without a thorough understanding of their lease frequently concede points they did not need to concede.
Gather comparable evidence
Rent review negotiations are won or lost on comparable transactions. Both landlords and tenants should identify lettings of similar properties in the same market that support their position, and anticipate the comparables the other side is likely to rely on. Evidence from the period immediately around the review date carries the most weight.
Appoint a specialist adviser early
A chartered surveyor with lease advisory expertise brings market knowledge, negotiating experience, and an understanding of how disputes are resolved if talks break down. Appointing a specialist surveyor at an early stage gives them the time to build the strongest possible case and avoids concessions made in error before professional advice is in place.
Set a realistic opening position
An opening position that bears no relationship to market evidence will undermine credibility and extend the negotiation. Both landlords and tenants benefit from an opening figure that is supportable, even if it represents the stronger end of a reasonable range.
What makes a commercial rent review negotiation difficult?
Most rent reviews settle by negotiation between the parties' surveyors without reaching formal dispute resolution. But some negotiations are genuinely difficult, and understanding why helps both sides manage the process more effectively.
- Thin comparable evidence – In markets where few transactions have taken place around the review date, both parties may struggle to find direct evidence that supports their position.
- Disagreement over disregards – Where a tenant has carried out significant improvements to the property, the treatment of those improvements at review can be a major source of dispute.
- Wide opening positions – When the gap between the landlord's and tenant's initial figures is large, negotiations can take time to converge.
What happens if a commercial rent review cannot be agreed?
When direct negotiation between the parties fails to produce agreement, the lease will typically provide a mechanism for third-party determination. There are two main routes: independent expert determination and arbitration.
Independent expert determination
Involves the appointment of a surveyor who investigates the matter and reaches their own conclusion based on their expertise and the evidence presented. The independent expert is not bound by the submissions of the parties, can use their own knowledge of the market, and are not restricted to the evidence put before them.
Crucially, the decision of an independent expert is final and binding and cannot be appealed on the merits, only on a point of law in limited circumstances. Both parties should be aware of this before the process begins.
Arbitration
An arbitrator acts as a judge, deciding the matter on the basis of the evidence and submissions presented by the parties. The arbitrator is bound by the evidence and cannot introduce their own market knowledge.
An arbitration award can be appealed to the courts on a point of law under the Arbitration Act 1996, which gives it a slightly different risk profile from independent expert determination.
Both processes involve costs, including the expert or arbitrator's fees, and in some cases, the other party's costs. Arbitration is typically more expensive and time-consuming than independent expert determination. Our lease advisory team regularly acts in both independent expert and arbitration proceedings on behalf of landlords and tenants, preparing submissions and representing clients throughout the process.
What is RICS dispute resolution for rent reviews?
Where the lease provides for third-party determination but does not name a specific individual, either party can apply to the President of the RICS to appoint an independent expert or arbitrator. This is one of the most commonly used routes in contested rent reviews.
The RICS appointment process is straightforward. Either party submits an application form, pays the application fee, and the RICS appoints a suitably qualified surveyor from its panel. The appointed expert or arbitrator then sets out the procedure for the determination, including deadlines for submissions and any hearing arrangements.
Both processes can take several months from application to determination, and rent continues to be paid at the passing rate in the interim. Where the determination results in a higher rent, the difference is typically payable with interest from the review date.
Speak to our lease advisory team about a rent review
Whether you are a landlord seeking to maximise the rental value of your asset or a tenant looking to protect your position at review or renewal, specialist advice makes a material difference to the outcome.
Our lease advisory team acts for both landlords and tenants across the full range of rent review and lease renewal negotiations, from opening exchanges through to RICS dispute resolution and arbitration proceedings.
To take advantage of our expert lease advisory services, get in touch by calling 0800 051 2593 or filling out the form below. We can then arrange a confidential conversation with one of our surveyors.
