The real estate world has been buzzing in July, but not always with happy noises – a proposed ban on upwards-only rent reviews was unexpectedly included in the English Devolution and Community Empowerment Bill. Most of the Bill is about local government, but this short provision that was snuck into the back of a 338-page document without warning will have major repercussions for anyone renting or investing in commercial property.
Another eye-catching item was the Picturehouse case on insurance premiums. The High Court has ruled that a fairly typical lease clause did not entitle the landlord to charge its tenant the commission element of buildings insurance premiums. As Mark Reading and Lauren King observe, the practice of charging landlords' commission is not restricted to the landlord in this case. Insurance rent payments, allocation of commissions and lease wording should be carefully interrogated.
At the same time, landlords are breathing slightly easier following the Law Commission's recommendation that contracting out (of the Landlord and Tenant Act 1954) should not be abolished. A further consultation later this year will look at the contracting out procedure, which we think is well-intentioned but too cumbersome. The expensive renewal process will also come under the Commission's microscope, with a growing consensus that courts should have power to impose turnover rent and energy improvement clauses. The business world has changed a bit since 1954.
On a more sombre note, Martyn's Law, officially known as The Terrorism (Protection of Premises) Act 2025, received Royal Assent in April. The new law is named in honour of Martyn Hett who lost his life in the Manchester Arena bombing. The Act aims to ensure better security in places that could be a target for a terrorist attack. Lucy Smith explains that the Act will not come into force for at least two years, to give both the Government and those who will be responsible, time to prepare. My colleague Jenna Oppong has also recorded a short video on this new Act.
We live in times of economic uncertainty, and there has been a surge in real estate assets coming to market via fire sales through formal and informal insolvency processes. This trend is likely to continue as costs increase for many businesses with real estate assets at their core. Paul McLoughlin and Venessa Toofanny examine the scope for unlocking value opportunities, as well as the risks for investors to bear in mind.