Exchange Place 1, Edinburgh
As a precursor to larger rent reviews within the property, our challenge was to ensure a good outcome to the first review in the building, this involving one of the smallest suites with the highest passing rent. With the existing rent a headline rent set on first letting, there was no evidence of net rents above that level.
Forensic analysis of the lease was key to success as the drafting of the review clause indicated to us that a headline rather then net rent should apply at review. Whilst challenged by the tenants, we won the legal debate.
Despite counter arguments from the tenant that a lease with rent reviews to headline is an onerous lease, and that a discount for such onerosity would result in a discount back to something less than the passing rent, we negotiated an increase in rent to almost £31.00 per sq ft exclusive of parking at £3,000 per space. Following the sale of the building we have since been retained by the purchaser to continue with the remaining rent reviews.