Your lease ended but you’re still paying rent. Now what?
Many business owners find themselves in this legal no-man’s land. Still handing over payments, unsure of where they stand, caught in a rental trap with no clear way out.
If your commercial lease expired but you’re still paying rent, don’t assume everything stays the same. Without the right protections, you could be overpaying, overstaying or even out the door before you know it.
What happens when a commercial lease ends?
A lease doesn’t just vanish when it expires. If you’re still in the property and paying rent, one of three things is happening:
Holding over under the Landlord and Tenant Act 1954
If your lease had security of tenure, you can stay on the same terms until a new deal is made or the landlord serves formal notice. This means the lease continues on a “hold over” basis until a new agreement is reached or legal action is taken.
Periodic tenancy
If no renewal is signed but rent keeps coming in, the lease may roll forward on a monthly or quarterly basis.
No clear agreement
If you and the landlord haven’t addressed it, they could demand higher rent or even ask you to leave. Don’t expect much notice, the landlord has no obligations after a commercial lease ends so the eviction could come at any time.
If your commercial lease expired but you’re still paying rent, knowing your status is critical. A handshake deal isn’t enough to protect your business. Here’s what you need to know to avoid costly surprises and secure your space, or plan your exit strategy.
Do the same lease terms still apply?
Paying rent might make it seem like everything stays the same. But that’s not always true. Keep in mind that:
- You could still be liable for rent increases and service charges.
- Repairs and maintenance may still be your responsibility.
- Leaving the property might still require official notice.
Some business owners prefer the flexibility of a rolling lease. But it’s a double-edged sword. Without a contract, you have no long-term security. If your commercial lease expired but you’re still paying rent, it’s probably time to firm up your position.
Can a landlord raise the rent?
The short answer is yes. If your lease expired and there’s no formal renewal, your landlord may try to raise the rent.
The rules depend on your previous agreement:
- If your lease had protection under the Landlord and Tenant Act 1954, changes require proper legal notice.
- If not, the landlord could hike rent with little warning. Or refuse to renew the lease at all.
Don’t wait until a higher bill arrives. If your commercial lease expired but you’re still paying rent, it’s time to start negotiations before your landlord does.
How to take control of the situation
If your lease has run out and you’re still paying rent, act before problems arise. The longer you wait, the fewer options you may have. Here’s a step-by-step guide:
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Check your lease terms
Was your lease protected under the Landlord and Tenant Act 1954? If so, you may have the right to renew under the same terms. You might be more vulnerable if your lease wasn’t protected.
Understanding where you stand legally is the first step in deciding your next move. Carefully reviewing the lease agreement can also reveal any hidden obligations you may still be bound to, like maintenance costs or notice periods.
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Talk to your landlord
Don’t wait for your landlord to dictate the terms. Opening negotiations early gives you a better chance of securing favourable terms. Many landlords are open to adjustments, particularly if you’re a long-term tenant with a good payment history.
No matter what your goals, approaching the conversation with a clear plan puts you in a stronger negotiating position.
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Get legal advice
A commercial property solicitor can help you understand your rights, negotiate fair terms, and make sure you’re not unknowingly agreeing to unfavourable conditions. Legal experts can also spot clauses in your original lease that might work in your favour.
If the landlord is pushing for unreasonable terms, a commercial property solicitor can advise on your legal recourse and how to strengthen your position.
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Consider your options
If negotiations don’t go your way, relocating might be the best long-term decision. Moving premises can be daunting but it could open up better opportunities. Compare costs, consider the impact on your customer base, and assess whether a new space aligns with your business’s growth plans before committing.
Secure your business with expert legal advice
If your commercial lease expired but you’re still paying rent, don’t wait for the situation to spiral. At Osbourne Pinner, we have a dedicated team for lease renewals, disputes and negotiations. Our goal? To protect your business.
Contact Osbourne Pinner today for a free 30-minute consultation. Get in touch using the form below, call 0203 983 5080 or email [email protected] and let’s make sure your lease works for you, not against you.
