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Shop Lease Agreement

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Solicitor-approved shop lease agreement: easy to use template for a short-term lease. Download now.

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Available Formats

Valid in England, Wales
Price: £44.40
Page Length: 17
File Type: Microsoft Word
File Size: 105 KB

This Shop Lease Agreement, in a “Download Now” Word format, is a commercial lease between landlord and tenant for the letting of a shop on a short-term basis.

Drafted by solicitors for straightforward completion, the agreement is in Word format and is available to download instantly after purchase.

This shop lease template can be used when the term of the lease is relatively short. It's easy to use, includes expert guidance notes on how to fill it in and can be simply adapted to meet your needs.

In an instant, our Shop Lease Agreement ensures that you meet the requirements of tenancy law and includes wording in the lease designed to stop the tenant from getting security of tenure under the Landlord & Tenant Act 1954, together with guidance notes on the related formalities.

Clauses included in the Shop Lease Agreement

This document has 19 clauses outlining:

  • The landlord and tenant's rights under the terms of the commercial lease
  • Rent and interest
  • Repair and decoration of the shop
  • The landlord and tenant's legal obligations under the terms of the lease
  • Alterations of the commercial premises
  • Insurance
  • Subletting
  • Indemnity
  • The tenant's use of the shop
  • Returning the shop to the landlord at the end of the commercial lease
  • And much, much more...

For further details of the terms included in this legal form, see the ‘Contents’ tab above.

Note: This Shop Lease Agreement is supplied by and is one of a range of commercial lease agreements we provide.

More information

Contents of Shop Lease Agreement

This lease agreement template is intended for use of a short term shop lease where assignment and sub-letting isn't permitted. 

It's assumed that this shop lease agreement will be contracted out of the Landlord and Tenant Act 1954 and that it will be a head lease or, if an under lease, that the lease complies with the requirements of the head lease. It has been drafted so as to comply with the relevant recommendations of the Code of Practice for Commercial Leases (second edition, April 2002).

Landlord and tenant law is a complex area of law and specialist legal advice is always recommended before entering into a commercial lease, whether you are a landlord or a tenant.

Specific clauses

1. Definitions

There are a number of details to be completed here, including:

  • The address of the building and details of the premises
  • The interest rate on any late payment of rent 
  • The term (i.e. duration) of the workshop lease
  • The rent: normally an annual sum
  • Permitted use

2. Grant

The lease is granted for a fixed term. No title guarantee is given. The grant is made subject to the matters affecting the landlord's title at the date of the agreement.

The rent, together with VAT on it, and all other sums due under the lease agreement are all reserved as rent.

3. Rights

This section describes the rights granted to the tenant and the rights reserved to the landlord, together with other rights to which the lease agreement is subject. Reference is made to the rights and reservations in the transfer under which the landlord holds the freehold of the premises. This clause expressly excludes any rights over any adjoining property (other than any rights which may be specifically granted in the lease). 

This clause also excludes the provisions of section 62 of the Law of Property Act 1925 in the absence of which the commercial lease would confer on the tenant all easements, rights and advantages enjoyed by the premises at the date of the lease.

4. Rent and other payments

This section lists payments the tenant must make, including rent and all outgoings in respect of the premises (including VAT). This section does not include a rent review clause. 

5. Insurance

The landlord must insure the building (other than plate or window glass) and the tenant refund a fair proportion of the premium. 

6. No assignment, subletting or dealings

This section includes an absolute prohibition on dealings, i.e. transferring the shop lease to someone else or subletting.

7. Repair and decoration

This isn't intended to be a full repairing and insuring commercial lease. There are three specific obligations on the tenant:

  1. To keep the premises clean and tidy and to keep the windows clean.
  2. To replace broken or damaged glass.
  3. To redecorate and replace the floor coverings at the end of the term. 

There is then a general repairing obligation on the tenant. On the assumption that the shop lease isn't a full repairing lease, this section of the agreement includes wording limiting the repairing obligation by reference to a schedule of condition. It may not be worth the time and expense of preparing a schedule of condition for a short term commercial lease and, from the tenant's point of view, it would be better to delete the obligation all together.

If the tenant retains structural parts, the tenant may require a repairing obligation on the landlord.

8. Alterations and signs

This section allows the tenant to put up and remove non-structural, de-mountable shop fittings. Re-instatement is required at the end of the term of the lease agreement, only if this is reasonable.

Otherwise, the tenant may not carry out any alterations including alterations to service media. 

9. Tenant to remedy breaches

The landlord has a right to enter the premises to carry out repairs, if the tenant fails to do so.

10. Use

The permitted use is as a shop for sale of specified items. The description of the specified items in the lease agreement should be wide enough to cover the tenant's proposed business over the term of the lease.

11. Legal obligations

This section sets out the tenant's obligations to comply with all lawful requirements in respect of the premises.

12. Returning the premises to the landlord

This section sets out the tenant's obligations at the end of the commercial lease to remove all stock, fixtures and fittings.

13. Indemnity

There is a broad obligation on the tenant to indemnify the landlord, both for breach of covenant and for the tenant's acts or omissions. Acts or omissions are not limited to negligent acts or omissions and a tenant will need to check that they have appropriate insurance cover or seek to amend the provisions in this section.

14. Landlord's covenant for quiet enjoyment 

The landlord covenants with the tenant that, so long as the tenants pays the rents reserved by and complies with its obligations in the shop lease agreement, the tenant shall have quiet enjoyment of the premises without any lawful interruption by the landlord or any person claiming under the landlord.

15. Condition for re-entry

The landlord may re-enter the shop at any time if the tenant doesn't pay the rent for 21 days or breaches any condition or tenant covenant of the lease agreement.

16. Liability

The obligations of the tenant are owed to the landlord and the obligations of the landlord are owed to the tenant.

17. Notices

This lease agreement template includes a short form notice clause. Notices must be in writing (except in case of emergency or if the agreement states otherwise) and writing includes faxes, but doesn't include email.

18. Entire agreement and exclusion of representations

The purpose of an entire agreement clause is to set the limits of contractual obligations and to prevent the party relying on the clause from being liable for representations made before the shop lease is entered into. 

In this clause the landlord seeks to exclude liability for pre-contractual (mis)representation. This will only be valid if it's reasonable and the issue of reasonableness will be looked at in the context of each particular case.

19. Miscellaneous

Landlord and Tenant Act 1954

It's assumed that this commercial lease will be excluded from the security of tenure provisions of the Landlord and Tenant Act 1954. 

Under the Landlord and Tenant Act 1954, a business tenant is entitled to have their lease renewed at the end of the term, except in certain circumstances; in particular, when the landlord wants to redevelop the site. It's, however, possible to exclude the provisions of the Act so that the tenant doesn't have any protection. There are now three specific requirements if the tenant isn't to obtain security of tenure at the end of the term:

  1. The landlord must give a notice to the tenant in a prescribed form at least 14 days before the tenant enters into the tenancy or becomes contractually bound to do so. The form of notice which contains a 'health warning' is attached to this Shop Lease Agreement template.
  2. The tenant must sign a declaration in front of a solicitor or commissioner for oaths confirming that they have received the landlord's notice. 
  3. The agreement must refer to the above procedures as having being complied with and confirm that the landlord and tenant agree to exclude the security of tenure provisions in Sections 24 to 28 of the Landlord & Tenant Act 1954.

Contracts (Rights of Third Parties) Act 1999

This clause also excludes the operation of the Contracts (Rights of Third Parties) Act, which might give certain third parties the benefit of provisions in the lease agreement.

Landlord and Tenant (Covenants) Act 1995

It's common practice to include a statement that the commercial lease is a new tenancy for the purposes of the Landlord and Tenant (Covenants) Act 1995 (i.e. one granted after 1 January 1996) so that the status of the agreement is clear.

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