How To Change the Clauses in Your Commercial Lease in 2026

Key points

You can ask to change the terms of a commercial lease when you sign a new lease, renew at the end of your term, or when both sides agree to a variation during the lease.
The ban on upwards-only rent review clauses in commercial leases is now law. The English Devolution and Community Empowerment Act 2026 received Royal Assent on 28^th April 2026. The ban applies to new leases from 2027 and to renewal leases where terms were agreed on or after 17^th March 2026.
The RICS Service Charges in Commercial Property professional standard, 2nd edition, has been in effect since 31^st December 2025. Landlords must recover only what the lease allows, provide annual budgets and year-end accounts, and clearly justify any apportionment.
Green lease clauses dealing with energy performance, building improvement costs and utility data-sharing are now common in offices, retail units and warehouses.
A duty on business ratepayers to notify the Valuation Office Agency of changes to their properties is being phased in between 2026 and 2029.

Yes, you can ask to change the terms of your commercial lease. The right time to do it is when you are negotiating a new lease, renewing at the end of your term, exercising a break clause, or when both you and your landlord want to change something mid-term by deed of variation.

Several legal changes have come into force or are coming soon that affect what good lease terms look like. The ban on upwards-only rent reviews is now on the statute book. Updated professional standards on service charges have been in effect since the end of 2025. Green clauses, energy obligations and new business rates duties are appearing in standard lease drafts. If you sign or renew without checking these points, you may be agreeing to terms that are already behind where the law and market practice have moved.

Cocks Lloyd’s commercial property solicitors advise landlords and tenants across Nuneaton and Warwickshire on lease negotiations, renewals and disputes. This article sets out the seven types of clause most worth reviewing in 2026, what the current legal position is on each one, and what you can reasonably ask for. For advice on your specific lease, please get in touch with our commercial property team.

What has changed in 2026?

The most significant change is the abolition of upwards-only rent review clauses. Until this year, most commercial leases in England and Wales said rent could only go up at review, never down or stay flat. The English Devolution and Community Empowerment Act 2026 received Royal Assent on 28^th April 2026. Section 100 of the Act abolishes upwards-only rent review clauses in new commercial leases and in renewals. The ban takes effect from 2027 for new leases. Renewal leases where terms were agreed on or after 17^th March 2026 are already caught. The Act also targets anti-avoidance devices such as collar clauses that keep rent above a minimum even when market rates fall.

On service charges, the RICS Service Charges in Commercial Property professional standard, 2nd edition, took effect on 31^st December 2025. Landlords must recover only what the lease permits, must not profit from service charges, and must issue budgets and accounts within set timeframes. Apportionment by floor area is now the recommended approach; apportionment by rateable value is no longer encouraged.

The Landlord and Tenant Act 1954 remains in force and gives most business tenants the right to renew their leases. The Law Commission has published an interim statement confirming that the right to renew will be kept, although procedural reforms are expected in a second consultation. No changes to the Act are currently in force.

On business rates, a duty requiring ratepayers to notify the Valuation Office Agency of changes to their properties is being introduced in phases. A pilot began on 1^st April 2026. The duty becomes mandatory for all ratepayers from 1 April 2029. The government’s guidance on this is published on GOV.UK. When a notifiable change occurs, ratepayers must tell the VOA within 60 days.

Lease clauses to review in 2026

When reviewing a commercial lease this year, these are the areas that most often cause problems or present an opportunity to improve your position.

Rent review

The upwards-only rent review clause is now unlawful in new leases and in most renewals from 2027 onwards. For any lease you are negotiating or renewing now, you can ask for a review mechanism that allows rent to rise or fall with the market. Where a landlord prefers certainty over a market-based review, consider index-linked or fixed stepped increases agreed from the outset. These fall outside the Act because the future rent can be determined at the start without a review event.

Watch for any clause that sets a minimum rent or a floor below which rent cannot fall. These are among the anti-avoidance provisions the Act is designed to catch. If such a clause appears in a draft lease or renewal, take advice before signing.

Break clauses

A break clause gives you the right to end the lease early on a set date, by giving the landlord advance notice. This is valuable if your business plans might change during the term. The conditions attached to a break matter enormously. Courts have held that minor failures to meet a break condition can make the break ineffective. Keep conditions as simple as possible: payment of the principal rent up to the break date and return of the keys should be sufficient. Anything more complex increases the risk that the break will fail when you try to use it. For more on this, see Cocks Lloyd’s guidance on break clauses in commercial leases.

Service charges

The RICS standard that took effect in December 2025 sets out what landlords can and cannot recover through a service charge. Recovery is limited to what the lease specifically allows. Capital expenditure, unless expressly permitted, falls outside that. Landlords must issue budgets before each service charge year and accounts within a reasonable period after it ends.

Ask for a service charge cap in the early years of the lease. Ask for accounts within six months of each year-end. Where the lease gives the landlord an open-ended list of recoverable items, push back: courts and the RICS standard both require the landlord to act reasonably and costs to be proportionate to services actually provided.

Repairing obligations

Most commercial leases make the tenant responsible for all repairs, inside and out. Where the building is old or already in poor condition, you can end up paying to fix problems that existed before you moved in. Ask for a schedule of condition, a written record with photographs taken at the start of the lease, that limits your obligation to keep the premises in no worse condition than shown in those photographs. Without one, you may face a wide dilapidations claim at the end of the term.

Green and energy clauses

Green lease clauses address energy performance, efforts to improve a building’s environmental rating, and the sharing of utility data between landlord and tenant. They are now standard in many institutional leases and are increasingly appearing in local commercial lettings. The questions to pin down before signing are whether you are required to fund works, whether there are performance targets you must meet, and what data you must share. In a multi-let building, utility data can reveal trading patterns you would prefer to keep private. Agree on clear limits on costs and data sharing before you commit.

Assignment and subletting

Assignment means transferring your lease to another business. Subletting means letting part or all of the premises to another occupier while you remain the tenant. Both are exit routes if your business changes during the term. Most leases state that landlord consent is required, but it cannot be unreasonably withheld or delayed. Check whether the lease allows subletting of the whole or part. Many do not, which creates a difficulty if you want to share a unit or sublet a section you no longer need.

Business rates and the duty to notify

Business rates are a tax on commercial property, calculated from the rateable value of your premises. All rateable values in England were updated from 1 April 2026 under the 2026 revaluation. Your rates bill may have changed as a result.

Under the incoming duty to notify, you will need to tell the VOA within 60 days of certain changes to your property, including changes of occupier, rent reviews, lease renewals and physical alterations. When negotiating a lease, check who is responsible for notifications, who bears the risk of any penalties, and how rating appeals are handled. In a multi-let building, the landlord often holds information about building-wide changes that affect the rating list. A lease that places all penalty risk on the tenant, without a corresponding obligation on the landlord to share information, is worth challenging.

What you should do now

If you are about to sign or renew a commercial lease, address these points before you agree to the heads of terms. Heads of terms are the summary of the main commercial deal agreed between landlord and tenant before a formal lease is drafted. A point omitted from the heads of terms is harder to introduce once the lawyers are working on the document.

Check each of the following before you sign or renew:

Does the rent review clause allow rent to go up or down? From 2027, an upwards-only clause in a new lease or renewal will be unlawful.
Are the break clause conditions simple? Payment of rent and return of keys should be sufficient.
Does the wording of the service charge reflect the RICS 2025 standard? Ask for an annual budget, a year-end account within six months, and a clear apportionment schedule.
Is there a schedule of conditions for the building if it is not newly built?
Do any green clauses require you to fund works? If so, what is the limit on your liability?
Can you assign or sublet either the part or the whole?
Who is responsible for VOA notifications, and who bears the penalty risk if a deadline is missed?

Cocks Lloyd’s commercial property team can review heads of terms or a draft lease before you sign. We can identify where clauses are out of line with current law and practice, and propose targeted changes that are more likely to be accepted by the other side. Find out more about our commercial lease negotiation service.

Where the law is heading

The abolition of upwards-only rent reviews is the most significant statutory change to commercial leases in England and Wales for many years. It reflects a clear government view that rent review mechanisms should track the market. The anti-avoidance provisions in the Act show that Parliament was alert to the use of collar clauses and similar devices to circumvent the ban.

The Law Commission will publish a second consultation paper on the Landlord and Tenant Act 1954 in due course. Security of tenure is set to remain, but procedural changes are expected. These may make it easier for tenants to pursue renewal rights and harder for landlords to delay or frustrate the process. If your lease is contracted out, meaning you gave up your right to renew in advance, this is worth bearing in mind when your term approaches its end.

The duty to notify the VOA is still being rolled out. By 2029, all business ratepayers will be in scope. Getting your lease clauses right on rating cooperation and information-sharing now means you are not trying to fix a gap when deadlines are already running.

Frequently asked questions

Can I change my lease terms during the current term?

Yes, you can change lease terms at any point if both you and your landlord agree. A deed makes changes during the term of variation. Landlords will not usually reopen terms without a reason. Still, where a change benefits both sides, for example, a tenant agreeing to a longer term in return for improved service charge or repair provisions, there is often scope to agree.

Does the new Act affect my existing lease?

No, the upwards-only rent review ban under the English Devolution and Community Empowerment Act 2026 does not affect leases already in place. It applies to new leases from 2027 and to renewal leases where terms were agreed on or after 17^th March 2026. If your current lease has an upwards-only clause, it remains in force until the lease ends or is varied by agreement.

Do I have to accept green clauses if the landlord insists?

No, you do not have to accept any clause as drafted. Green provisions are becoming more common, particularly for offices and higher-value commercial space, but most landlords will negotiate the details. The two points most worth fixing are who funds any work required to meet energy targets and what limits apply to data sharing.

What is a schedule of conditions?

A schedule of condition is a written record, usually with photographs, of the state of a building at the point you take on the lease. It limits your repair obligation to keeping the premises in no worse condition than shown in those photographs. Without one, you may face a dilapidations claim at the end of the lease for problems that were present before you arrived. Schedules are most important for older buildings, but are worth requesting for most commercial premises.

When does the duty to notify the VOA become mandatory?

The duty to notify becomes mandatory for all business ratepayers from 1 April 2029. A pilot with a small group of ratepayers began on 1^st April 2026. From 2029, you must tell the VOA within 60 days of certain changes to your property, including changes of occupier, rent reviews, lease renewals and physical alterations. Penalties apply for non-compliance. Check the VOA’s published guidance and make sure your lease clauses are clear on who is responsible for making notifications.

Final words

Commercial leases are long documents, and the clauses that cause trouble are rarely the ones that are easy to spot on first reading. Rent review wording, service charge recovery, repair obligations, and break conditions are all areas where getting the details wrong can cost significant sums over the life of the lease. The legal changes of 2025 and 2026 make it more worthwhile than ever to review a draft carefully before you sign.

To find out how our team can help with a commercial lease negotiation, renewal or dispute, please phone us on 0247 6641642 or fill in our contact form, and we will get back to you as quickly as possible.