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Landlords need to avoid pop-up pitfalls

With nearly 1 in 10 shops across the country empty, landlords are increasingly turning to pop-up retailers for a temporary solution – especially when looking to reduce their empty rates liability.

However, they must not lose sight of the bigger picture, particularly when deciding what sort of agreement to make with a pop-up.

Landlords may consider using a licence, lease, tenancy at will or even a hire agreement. As the agreement is to regulate a relatively short period of time, a landlord may assume that a licence to occupy or a tenancy at will may be the best way forward.

However, the landlord should remember that these documents can be fickle and can sometimes afford the tenant security of tenure if not used properly. Our preference is to use a short-form lease that is excluded from security of tenure under the Landlord and Tenant Act 1954.

In this context, it is likely to be very important that the tenant doesn't gain security of tenure because the lease will probably contain various tenant-friendly terms which the landlord would not want to be tied to in a long term lease.

Pop-ups can be a useful tool in combatting rates liability and bringing more vibrancy to shopping pitches, but it’s very important to get the structure right.

 

 

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240 Blackfriars Road
London
SE1 8NW
DX 53 Chancery Lane

Telephone: +44 (0)20 7629 7411
Fax: +44 (0)20 7629 2621
Email: bh@boodlehatfield.com

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