Glossary
Commercial lease
A business lease of a property, used by some rent-to-rent operators instead of a company let.
What it means
A commercial lease lets a property to a business for business use. In rent-to-rent, it makes clear the operator is running a business from the property, not living in it, and can set out repairs, insurance, permitted use and subletting. In England and Wales, many short business leases are contracted out of the security of tenure rules in the Landlord and Tenant Act 1954, so the operator has no automatic right to renew. Take legal advice on the drafting.
Worked example
ExampleA five-year commercial lease on a six-bed house at £1,450 a month, run as an HMO.
- Rent over the term
- £87,000
- Repairs
- Internal: you. Structure: landlord.
- Renewal
- Contracted out, so by agreement only
Who repairs what decides your real costs. Read the schedule of condition before you sign.
Information, not advice. Example figures are fictional and for illustration only.