Opportunity for lessee to have current market rent determined early
36 Opportunity for lessee to have current market rent determined early
A retail shop lease that provides an option to renew or extend the lease at current market rent is taken to include provision to the following effect:
the lessee is entitled to request a determination of the current market rent within the period that begins six months before and ends two months before the last day on which the option may be exercised under the lease, but may not make such a request if the lessor and the lessee have already agreed as to what the actual amount of that rent is to be;
the lessee makes a request by giving notice in writing of the request to the lessor;
if the lessee makes a request, the amount of the current market rent is to be determined (as at the time of the request) in accordance with the provisions of section 35, and the period within which the lessee must exercise the option is varied so that the last day on which the option may be exercised is
21 days after the determination of rent is made and notified to the lessee in writing or the last day of the term of the lease, whichever is the earlier;
the parties agree that the amount of rent determined under paragraph (c) is the current market rent for the purposes of the exercise of the option (even though it may be a determination of the current market rent as at some earlier time);
the parties to the lease are to pay the costs of the determination of current market rent in equal shares unless the lessee decides not to exercise the option to renew the lease in which case the lessee is liable to reimburse the lessor for the lessor's share of the costs (ie the lessee must bear the costs in their entirety).
If the term of the lease is 12 months or less, the periods of six months and two months in this section are shortened to three months and 30 days respectively.
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