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Upward only rent reviews

  • 29-10-2010 1:02pm
    #1
    bellylint
    Registered Users, Registered Users 2 Posts: 230 ✭✭


    Not sure if this the right forum, but was wondering what is the story with these? Is every business lease subject to this clause by law or something?

    anybody know much about these things and why it still exists?


Comments

  • #2
    AckwelFoley
    Registered Users, Registered Users 2 Posts: 12,555 ✭✭✭✭AckwelFoley


    bellylint wrote: »
    Not sure if this the right forum, but was wondering what is the story with these? Is every business lease subject to this clause by law or something?

    anybody know much about these things and why it still exists?

    Foolishly people signed these leases during the boom and was common practice, and now that the economy nose dived.. they're caught in them.


  • #3
    FunnyStuff
    Closed Accounts Posts: 344 ✭✭FunnyStuff


    Any business that signed one of these leases, to be honest, needs their head examined.


  • #4
    gurramok
    Closed Accounts Posts: 13,992 ✭✭✭✭gurramok


    Hence Chartbusters went to the wall. If only landlords copped on that maintaining these reviews is killing retail and their tenants.


  • #5
    Slideshowbob
    Registered Users, Registered Users 2 Posts: 2,460 ✭✭✭Slideshowbob


    http://www.google.ie/#hl=en&source=hp&biw=596&bih=530&q=korkys+rent&aq=f&aqi=&aql=&oq=&gs_rfai=&fp=7b1d31a7ed8065cf

    i think a case was due to go to court in the last year or so which would have been a test case to dispute upward only rent reviews

    but i think it got stalled as would have scuppered NAMA's raison d'etre !!!


  • #6
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    There was some talk about the law being changed to ban upward only reviews. I'm not sure if this has been done but even if it has, it only applies to new contracts.

    Even though both parties entered into a contract stipulating upward only review, any contract is open to renegotiation if it is no longer in the interest of either party to maintain it. If both landlord and tenant want to reduce the rent there is nothing stopping them. The landlord is only bound by the clause if the tenant chooses to hold him to it.

    Therefore the real problem is likely to be deeper than a superficial contractual issue. Most likely it is that the landlord is bound up in various debts and is holding out for some sort of pick up in the economy. Lowering rents, though it might make sense in the long term, in the immediate short term might bring about insolvency.


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  • #7
    sollar
    Closed Accounts Posts: 2,007 ✭✭✭sollar


    It would really need to be changed. But are the government likely upset the big boys and get rid of it. I doubt it.


  • #8
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    sollar wrote: »
    It would really need to be changed. But are the government likely upset the big boys and get rid of it. I doubt it.
    But let us say the law was changed so that the upward only clause was abolished in all existing rental contracts. When it comes to the next rent review why would the landlord now wish to lower rents when previously he did not?


  • #9
    sollar
    Closed Accounts Posts: 2,007 ✭✭✭sollar


    I'd say alot of them would hide behind the upward only clause in negotiations, but if the company shows thm the books and says we are in trouble and can't afford the high rents some of the landlords will have to be realistic and renegotiate if the clause was gone.


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