End of upward-only rents moves step closer
THE end of upward-only reviews is edging closer, with reports suggesting tenants renting commercial properties will soon be allowed to end their leases and get a lower rent.
The new legislation, which has been promised by the Government, is expected to come into force by the end of the year.
The 'NAMA Wine Lake blog' yesterday reported what it claims are the main parts of the proposed legislation, saying new legislation will allow tenants to apply to the courts for a lower rent where they are paying more than current market rates. In court they will need to prove that the punitive rent is a threat to their business.
The tenant must also show that reducing the rent will significantly change the prospects for their long-term survival, although there are no details of what this might entail. Any new rents set by the court will apply for a period of five years, after which upward-only rent review terms will kick back in, according to the blog.
The Department of Justice wouldn't confirm the details in the report yesterday and said Minister Alan Shatter had forwarded outline proposals for the legislation to the Attorney General who was examining them.
"Those proposals have already been the subject of preliminary discussion by the Government. The legislative programme indicates that the relevant legislation will be published during the current Dail session," a statement said.
Tenants who stand to benefit from the new laws must have taken out a commercial lease before February 28, 2010. Leases taken out after this date are already covered by changes made by the previous government banning the upward- only rent review clause.