Unpacking the Proposed Ban on Upward-Only Rent Reviews
Glenny LLP examines the Government’s proposal, introduced on 10 July 2025 in the English Devolution and Community Empowerment Bill, to ban upward-only rent review clauses in new commercial leases in England and Wales. Landlords would need to use fixed rents or reviews that can move both up and down. Existing leases would not be affected, but the ban would cover new leases and some renewals under the Landlord and Tenant Act 1954, with any upward-only clause becoming unenforceable. Some areas, such as agricultural leases, would be exempt.
Paul Aylott, head of Glenny’s Lease Advisory and Valuation team, notes there was no industry consultation and that clarity on renewals is still awaited. He points out that many shorter leases already allow two-way adjustments and that genuine cases for rent reductions have been rare in the past decade. Colleague William Martin expects tougher negotiations, more short leases outside the 1954 Act, and a shift towards turnover or CPI-linked reviews for longer leases, with isolated offices facing more valuation uncertainty than logistics. Sam Coker adds that landlords will have less reason to seek long lease commitments if rents can fall.
Glenny’s data suggests downside risk in industrial is limited, as five-year reviews still reflect the strong rental growth of 2021–22 and take-up rose around 10% to 5.4 million sq ft in 2024. Retail and secondary offices are more exposed.
The British Property Federation has raised concerns, while the Federation of Small Businesses has welcomed the move, and UK REIT share prices reportedly dipped after the announcement. If renewals are included, Glenny expects landlords to seek higher initial rents, reduced incentives and tighter break and dilapidations terms. Overall, it anticipates a muted effect on industrial rents and values.