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COMMERCIAL LEASES LECTURE 3

Jennifer Slade. COMMERCIAL LEASES LECTURE 3. Commercial Leases: Lecture 3 Today’s topics. Commercial lease drafting Standard forms/precedents Examples “Lease anatomy” Code of Practice for Commercial Leases Lease of part and of whole Prescribed clauses.

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COMMERCIAL LEASES LECTURE 3

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  1. Jennifer Slade COMMERCIAL LEASESLECTURE 3

  2. Commercial Leases: Lecture 3Today’s topics • Commercial lease drafting • Standard forms/precedents • Examples • “Lease anatomy” • Code of Practice for Commercial Leases • Lease of part and of whole • Prescribed clauses

  3. Commercial Leases: Lecture 3Landlord and Tenant concerns • Drafting for the landlord • Control of premises • Marketability/investment value • Standard lease for development • Exceptional tenants • Confidentiality – EID’s • Tenant’s amendments • Flexibility, rent review, onerous provisions, marketability • Draft for certainty

  4. Commercial Leases: Lecture 3Drafting points • Defined terms and interpretation clause • Use of schedules • Definitions in schedules • Punctuation and layout • Clause numbering, e.g.: • Clause 2.1.3.4 • Clause 2(1)(c)(iv) • Clause 2.1(c)(iv)

  5. Commercial Leases: Lecture 3Precedents/Standard Forms • Firms’ precedents • Updating • Client specific • Law Society Business Lease • BPF – model clauses • Other precedents: Lexis Nexis, Practical Law • Construction of lease provisions

  6. Commercial Leases: Lecture 3Examples of lease drafting Gateshead lease (1964) vsBillies Cookies lease (1999) Gateshead lease – consider: • term – expiry? • Clause 4 • Clause 5 • Clause 6 • Plan • Easy to read? Easy to find information?

  7. Commercial Leases: Lecture 3Examples of lease drafting Consider Billies Cookies lease • Comments/comparison? • How could drafting style of Billies Cookies lease be improved?

  8. Commercial Leases: Lecture 3Lease Anatomy • What are the principal provisions, and where would you find them? • Code of Practice for Commercial Leases • What is the purpose of a lease report? • For assignee • For purchaser of reversion

  9. Anatomy of a Simple Commercial Lease: Date, Parties Definitions, Interpretation Demise (habendum, reddendum) TENANT’S COVENANTS - repair, alienation, user, alterations, etc Landlord’s Covenants Provisos SCHEDULES - premises, - rights, reservations - rent review - service charge

  10. Commercial Leases: Lecture 3Lease Anatomy • What is the difference in structure between a lease of whole and a lease of part? • Multi-lets • Service charge • Common parts • Insurance

  11. C O M M U N A L A R E A Unit 1 w.c. Unit 2 Unit 3

  12. Commercial Leases: Lecture 3Lease Anatomy • Land Registry Prescribed Clauses Leases • Necessary from 19 June 2006 for registrable leases – if not, Land Registry rejects • Prescribed clauses LR1 – LR14 • Only front sheet and index can precede prescribed clauses – particulars pages must come after • Note Property prescribed clause – LR4 • Prescribed clause overrides any other definition • See precedent in recommended text

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