Commercial lease break – pre-emptive strike!

admin Fresh News, Legal updates

Real Estate legal experts Taylor Wessing report on Royal Mail's request for guidance on a forthcoming lease break and its importance;-

In light of the recent Court decisions on break clauses that have gone against tenants (please see TW's article on the M&S break litigation),  another FTSE 100 tenant, Royal Mail, has now decided to take a pre-emptive strike (Royal Mail Group Ltd v Airport Industrial GP Ltd and another). In November 2003 Royal Mail took a lease of the London Air Mail Unit at London Heathrow Airport, which provided for a conditional tenant's option to terminate the lease on 25 February 2015, the tenth anniversary of the rent commencement date. Royal Mail decided to exercise this break right and served a break notice on its landlords on 23 April 2014. Royal Mail has applied to Court for guidance as to the requirements of its lease where it is in dispute with the landlord over the exact requirements of the break option, and the break date has not yet arrived.

Royal Mail is seeking a number of declarations from the High Court, including:

the sum it must pay as a condition of the break;

whether payment can be made ahead of time or must be "on the break date";

whether reinstatement and vacant possession are preconditions; and

whether a full quarter's rent of £461,865 plus VAT, due on 1 January 2015, must be paid in full to break the lease.

Royal Mail has taken the unusual step of making a pre-emptive application to the Court before the break date – rather than afterwards. Whilst the requirements of the lease will be unique to this case, it is a sign of the recent times that a tenant has taken this course of action, and it will also give useful guidance as to how the Court is likely to treat such applications and such clauses.

Taylor Wessing are expecting to report on the outcome of the case later this year.

Written By

Admin

This is just test data. This is just test data. This is just test data. This is just test data. This is just test data. This is just test data. This is just test data. This is just test data.

You May Also Like..

Letting at Prestigious Yeoman Gate Business Park Announced

Brierley & Coe have let Building E2 at the Yeoman Gate Business Park in Worthing.
This 3,000 sq ft two storey office built in 2007 was fully refurbished to a high standard and let prior to a full marketing campaign to waiting applicants.
As a result, our Landlord client had a zero void between the previous tenant vacating and the new one starting.

E2 Yeoman Gate Worthing… read the rest of “Letting at Prestigious Yeoman Gate Business Park Announced”

Ford Business Park- Letting Success

Following a successful marketing campaign Brierley & Coe have announced the letting of Unit 20 at the Ford Lane Business Park, Ford.
This impressive office and storage unit totals 3,300 sq ft over two floors and has been let for a period until 2021… read the rest of “Ford Business Park- Letting Success”

Prime Retail Unit Worthing – To Let

6-8 Warwick Street, Worthing

Brierley & Coe have launched the marketing of a prime shop in the heart of Worthing. The former Jessops store is located at the top end of Warwick Street. In all, 2303 sq ft including upper parts. Details on our website.… read the rest of “Prime Retail Unit Worthing - To Let”

Leave a Reply

Your email address will not be published. Required fields are marked *