When you rent commercial property in the UK, look first at the lease, not the premises. Check its length, the rent review basis, who repairs what, whether you can leave early and whether you keep the right to renew. Then confirm that your business use is allowed, add up every cost beyond the rent, and test the location, condition and facilities against how you actually work. This guide takes you through each check in the order you will meet them.
TL;DR
- The lease decides most of your risk: term, rent reviews, break clause, repairing obligations and whether the Landlord and Tenant Act 1954 protects your right to renew.
- Confirm permitted use and planning permission before you sign, not after.
- Budget beyond the rent: business rates, service charge, insurance, utilities, legal fees, possible VAT and Stamp Duty Land Tax.
- Judge the premises on location, condition, energy performance and facilities, and view them at the time of day your business will use them.
- Ask for agreed terms in writing as "subject to contract" heads of terms, and take legal advice before signing.
Table of Contents
- Start with the lease, because it sets your risk
- Confirm permitted use and planning
- Add up the full cost, not just the rent
- Repairs, maintenance and safety: who carries what
- Judge the premises: location, condition and facilities
- Red flags in a lease or a landlord
- Our perspective: compare before you commit
- Find your next unit on PropertyZoom
- A step-by-step checklist before you sign
- FAQ
- Sources
Start with the lease, because it sets your risk
A commercial lease is a negotiated contract, not a standard form like many residential tenancies. Terms vary widely, and the RICS Code for Leasing Business Premises tells professionals to be transparent about them. It points tenants to the same short list of items: lease length, how and when rent is reviewed, break rights and their conditions, and whether the 1954 Act applies or is excluded.
Before a lawyer drafts anything, the landlord and you should agree the main points in writing. The same code recommends recording them as heads of terms marked "subject to contract", summarising items such as rent, term and repairing obligations. Treat that document as your checklist. If a point matters to you, such as a rent-free period or a break option, it belongs there.
Lease length and commitment
A longer lease can bring a lower rent or a rent-free period, but it also ties you to the space if your business shrinks or moves. A shorter lease keeps you flexible but may leave you facing renewal on the landlord's terms. Match the term to your realistic plans for the next three to five years, not your best-case forecast.
Rent and rent reviews
Ask three questions:
- How much is the rent, and is it quoted exclusive of VAT, business rates, service charge and insurance?
- How often is the rent reviewed, for example every three or five years?
- On what basis? Open market, fixed uplifts and index-linked reviews behave very differently. An "upwards only" review can raise your rent but never lower it.
Work out what your rent would be after the first review under a pessimistic assumption. If the business could not carry it, negotiate the clause now.
Break clauses
A break clause lets you end the lease early on a set date, usually by giving notice. The detail is where tenants get caught: notice periods, and preconditions such as having paid all rent or handed back the premises in a particular condition. Read the conditions as carefully as the date. A break you cannot meet in practice is not a break.
Security of tenure under the 1954 Act
Under the Landlord and Tenant Act 1954 in England and Wales, a lease that is "inside" the Act gives you the right to request a new lease when the term ends, and the landlord can refuse only on limited statutory grounds. A lease "outside" the Act, or excluded, gives you no such right, so you must leave or negotiate from scratch. The RICS code says tenants should be told at the outset if renewal rights are to be excluded, so ask directly. Excluded leases are common for short terms and can be perfectly reasonable, but you should accept one knowingly and price it in. If you plan to build a customer base at the address, security of tenure matters far more.
Assigning and subletting
Your plans may change, and you may one day want to pass the lease to a buyer of your business or share space. According to the RICS code, restrictions on assigning or subletting depend on the lease and usually need the landlord's consent, which should not be unreasonably withheld. Be ready for the landlord to ask for an Authorised Guarantee Agreement (AGA) as a condition of assignment, which can leave you liable if the new tenant defaults. Check what the lease says before you sign, not when you need to leave.
Confirm permitted use and planning
A unit is only useful if your business is lawfully allowed to operate in it. Two separate things apply: the use clause in the lease, and planning rules. Councils advise tenants to check that their intended use complies with planning regulations and to contact the local planning authority early.
Practical points:
- Compare your activity with the lease's permitted use. A narrow clause (for instance, offices only) can stop you adding retail sales, clients visiting or storage.
- Ask the planning authority, not only the landlord or agent, whether your type of business suits the premises, especially for food, health, leisure or anything with noise, deliveries or late opening.
- Ask about signage, alterations and opening hours, which often need separate consent from the landlord.
- Check whether the lease lets you change use later if your business grows.
Add up the full cost, not just the rent
The advertised rent is only one line of your occupancy cost. Council start-up guidance lists the usual items to budget for: rent, business rates, utilities, service charges, insurance, legal fees and Stamp Duty Land Tax where it applies.
| Cost | What to ask | |---|---| | Rent | Is it exclusive of VAT, rates and service charge? Any rent-free period or stepped rent? | | Business rates | What is the rateable value, and might you qualify for relief? | | Service charge | What does it cover, and can you see the previous year's accounts? | | Insurance | Does the landlord insure and recharge you, or must you arrange cover? | | Utilities | Are meters separate? Are there any shared supplies? | | Legal fees | Will you pay the landlord's legal costs as well as your own? | | VAT | Has the landlord opted to tax the building? | | SDLT | Is any Stamp Duty Land Tax payable on the lease? | | Moving and fit-out | What will it cost to move in, and must you reinstate the unit when you leave? |
Business rates and relief
Rates are charged on most non-domestic premises and can be a large cost, so ask for the rateable value before you commit. Small businesses may qualify for relief: Bristol City Council, for instance, says businesses can get 100% Small Business Rate Relief on a property with a rateable value up to £12,000. Rules and thresholds differ by area and change, so check with your own local authority.
VAT and Stamp Duty Land Tax
Commercial rent is exempt from VAT by default, but a landlord can opt to tax a building, after which rent is charged at the standard rate of 20%. If your business cannot reclaim VAT, that is a real 20% on top of the rent, so ask early. On SDLT, councils note that it is payable on certain commercial lease transactions, with the amount depending on factors such as rent and term. Your solicitor can calculate it for your lease.
Moving and set-up costs
Office and retail moves are often best planned around trading hours, and the cost of packing, labelling and relocating equipment is easy to forget in the first budget. Commercial moving services are one example of the support businesses use for a smooth changeover. In the UK, you can also browse removal firms and interior designers for fit-out help.
Repairs, maintenance and safety: who carries what
The lease determines who is responsible for repairs and maintenance. Read the repairing covenant closely. A "full repairing and insuring" lease can leave you responsible for the whole structure, which is a very different burden from an internal-only repairing obligation.
According to GOV.UK guidance for business tenants, tenants are normally responsible for fire, electrical, gas and asbestos safety, and for carrying out workplace health and safety risk assessments and removing hazards. The same guide covers basic workplace standards such as a reasonable temperature, enough space, ventilation and lighting, toilets and washing facilities, and drinking water.
What to do about it:
- Ask for a schedule of condition, with photographs, so you are not made to repair damage that was there when you arrived.
- Ask for the latest fire risk assessment, electrical and gas safety records and any asbestos register.
- Find out who maintains the roof, lifts, heating and shared areas, and whether you pay through the service charge.
- Ask whether you must restore alterations at the end of the term (dilapidations), and estimate that cost now.
- Consider a building survey. You can find property surveyors on PropertyZoom.
Judge the premises: location, condition and facilities
This is the part no lease can answer for you. Use these checks at the viewing, and return at a different time of day if you can.
Location
- Customers and footfall: for retail and services, stand outside for an hour. Who passes, and do they stop?
- Staff access: check commuting times, public transport and parking, including parking for visitors and deliveries.
- Neighbours: nearby businesses can bring competition, noise or helpful trade.
- Loading and access: vans need space, and some streets restrict delivery times.
Condition
- Look for damp, roof leaks, cracked floors, ageing windows and signs of poor repair.
- Test heating, lighting, water pressure and sockets.
- Check the floor area is the same as the one in the marketing particulars, and ask how it was measured.
- Check ceiling heights, floor loadings and door widths if you move stock or equipment.
Energy performance
Ask for the Energy Performance Certificate. Minimum Energy Efficiency Standards apply to most commercial lettings in England and Wales where an EPC is required, and law firm analysis in 2026 says landlords generally cannot let property rated below E unless an exemption applies, with a target of B by 2031 confirmed for leased buildings over 1,000 m². A poor rating can also mean high running costs for you, so it is worth reading even when the law is satisfied.
Facilities
- Broadband: ask which providers serve the address and the realistic speeds.
- Toilets, kitchen areas, meeting space and storage.
- Security, alarms, CCTV and out-of-hours access.
- Accessibility for customers and staff with mobility needs.
- Room to grow: could you take the next unit or extra floor?
Red flags in a lease or a landlord
None of these automatically means walking away, but each deserves a firm question.
- Renewal rights excluded without a clear explanation or an adjusted rent.
- Upwards-only reviews on an uncertain basis, or open-ended uplifts.
- Full repairing obligations with no schedule of condition for an older building.
- Break clauses with heavy preconditions, or notice dates that are easy to miss.
- Service charge with no cap and no accounts to look at.
- Narrow permitted use that does not match what you plan to do.
- Pressure to sign quickly, or reluctance to put terms in writing as heads of terms.
- Personal guarantees or large rent deposits that are out of proportion to the rent.
Our perspective: compare before you commit
We see commercial property searches go wrong most often in the first week, when people fall for one unit and stop comparing. A listing shows rent and floor area, but the cost that matters is the whole occupancy cost, and the term that matters is the one you can actually live with. That is why we built PropertyZoom around clear, side-by-side comparison: you should be able to see the essentials of several units quickly, so that questions about rent basis, size and location are asked of each one rather than only of your favourite.
Our advice is to shortlist three to five properties, ask every landlord the same list of questions, and put the answers next to each other. Differences in service charge, lease length or energy performance often show up only at that stage. Then use professionals where the stakes are high: a solicitor for the lease and a surveyor for the building.
— User
Find your next unit on PropertyZoom
If you are ready to start comparing, browse commercial space to rent on PropertyZoom. You can filter listings to your needs, view the essentials directly and compare units without wading through pages of detail. It is free for property seekers to use.
For a sense of what listings look like, see this office space on Loughborough Road in Leicester or a retail property in Manchester. When you move towards a lease, PropertyZoom also lists property conveyancers who can help with the legal work.
A step-by-step checklist before you sign
- Define your needs: floor area, location, budget, opening hours, staff and growth plans.
- Shortlist several properties and compare them on the same criteria.
- View in person, at different times, with a checklist of condition and facilities.
- Check permitted use and planning with the local planning authority.
- Agree heads of terms in writing, marked subject to contract.
- Get the full cost picture: rates, service charge, insurance, VAT, SDLT and legal fees.
- Instruct a solicitor to review the lease, including security of tenure, break and assignment terms, and a surveyor if the building's condition is uncertain.
- Record the condition with a schedule of condition before you move in.
- Diarise key dates: rent reviews, break notice deadlines and lease expiry.
FAQ
What are red flags to look for in a commercial lease?
Watch for excluded renewal rights, upwards-only rent reviews, full repairing obligations with no schedule of condition, break clauses with demanding preconditions and uncapped service charges. Also compare the permitted use with what you plan to do. A solicitor experienced in commercial leases should review these before you sign.
What questions should I ask about a commercial lease?
Ask how long the term is, how and when rent is reviewed, whether there is a break option, who repairs what, what the service charge covers and whether the lease is protected by the 1954 Act. Also ask about assignment and subletting, and whether VAT is charged on the rent. Put the answers in heads of terms.
Do I need a solicitor to rent commercial property?
You are not stopped from reading the lease yourself, but a commercial lease is a binding contract that can run for years and carry personal liability. A solicitor can explain the terms, negotiate changes and calculate any Stamp Duty Land Tax. The cost is usually small compared with the commitment.
What is security of tenure?
Security of tenure means that under the Landlord and Tenant Act 1954 you have the right to request a new lease when your current one ends, and the landlord can refuse only on limited grounds. A lease can be contracted out of the Act, in which case you have no such right. Ask at the outset which applies.
Sources
- RICS Code for Leasing Business Premises
- GOV.UK: Renting a business property, tenant responsibilities
- Waltham Forest Council: Guide to Leasing a Commercial Property
- Salford City Council: Start-up lease guide
- Milton Keynes City Council: Commercial Tenant's Handbook
- Bristol City Council: Business Start Up and Development Toolkit
- Baker McKenzie: MEES update for commercial lettings
- TinyTax: VAT on commercial property and rent