If you are a business tenant and your current tenancy is coming to an end, then one of your options may be to obtain a new tenancy for the same premises.
If so, then this will be a good time to negotiate more favourable terms which will match the new tenancy to any existing or anticipated changes to the business. For example, the business may have grown you want to are considering expansion, or you may be considering selling the business as a going concern.
In order for a tenant to request a new tenancy, a Notice in the prescribed form must be served on the landlord. The prescribed form is in accordance with section 26 of the Landlord and Tenant Act 1954 (the ‘Act’).
The tenant must include in the Notice the date when the new tenancy is to begin, and section 26(2) of the Act states that the date must not be “more than twelve nor less than six months after the making of the request, as may be specified therein”. It must not be the date on which “the current tenancy would come to an end by effluxion of time or could be brought to an end by notice to quit given by the tenant.”
The Notice must also include the proposed new rent, the length of the lease and other terms of the new tenancy.
The landlord must respond to a tenant’s Section 26 request within two months of receiving it if he wishes to oppose the proposed new lease.
If the landlord is not happy with any aspects of the Notice, then either party can apply to the court to settle any issues.
If the landlord is not happy with granting the tenancy, then he must apply to the court and argue so. If he successfully argues one or more of the grounds set out in the Landlord and Tenant Act 1954, then the court will order an end to the tenancy. If unsuccessful in opposing the Notice request, the court will order the grant of a new tenancy, and may assist in determining the terms of the tenancy if the landlord and tenant are unable to reach agreement on the individual terms of the tenancy.
It is important to note that that tenant cannot serve a Section 26 Notice where the landlord has already served a Section 25 Notice (to end a current tenancy and propose terms for renewal or prevent the tenant renewing).