Commercial leases in the UK regions: Business as Usual?

Research output: Contribution to journalArticle

Abstract

AbstractPurpose: This paper analyses the changing nature of commercial leases with specificreference to the landlord and tenant relationship, lease lengths and incentivisation in the postrecessionary UK property market.Design/methodology/approach: The research applies data analysis utilising the EstatesGazette Interactive database coupled with survey analysis conducted across three UK cities toinvestigate and compare the changing nature of the commercial property leasing market andthe landlord and tenant relationship.Findings: The empirical analysis highlights that recessionary conditions prevalent in themarket from the 2007 global crisis has caused a reassessment of lease structures leading toshorter lease terms and increased use of incentives, as tenants have been empowered tonegotiate more flexible leases due to their stronger market position.Originality/value: This paper builds upon previous research conducted back in 2005investigating commercial leases in the market up-cycle. The recent volatility in thecommercial property sector requires fresh insights and in-depth analysis of lease patterns,length and covenant strength, which is fundamental for investor decision-making. In addition,past research has tended to consider solely landlord or occupier perspectives, this researchoffers new insight into the landlord tenant lease negotiation process.
LanguageEnglish
Pages227-253
Number of pages28
JournalJournal of Corporate Real Estate
Volume18
Issue number4
DOIs
Publication statusPublished - Apr 2016

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Lease
Data base
Negotiation process
Design methodology
Global crisis
Covenant
Property market
Incentives
Empirical analysis
Leasing
Market position
Investor decision making

Keywords

  • Commercial leases
  • Landlord
  • Tenant
  • Incentives
  • Lease Length

Cite this

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title = "Commercial leases in the UK regions: Business as Usual?",
abstract = "AbstractPurpose: This paper analyses the changing nature of commercial leases with specificreference to the landlord and tenant relationship, lease lengths and incentivisation in the postrecessionary UK property market.Design/methodology/approach: The research applies data analysis utilising the EstatesGazette Interactive database coupled with survey analysis conducted across three UK cities toinvestigate and compare the changing nature of the commercial property leasing market andthe landlord and tenant relationship.Findings: The empirical analysis highlights that recessionary conditions prevalent in themarket from the 2007 global crisis has caused a reassessment of lease structures leading toshorter lease terms and increased use of incentives, as tenants have been empowered tonegotiate more flexible leases due to their stronger market position.Originality/value: This paper builds upon previous research conducted back in 2005investigating commercial leases in the market up-cycle. The recent volatility in thecommercial property sector requires fresh insights and in-depth analysis of lease patterns,length and covenant strength, which is fundamental for investor decision-making. In addition,past research has tended to consider solely landlord or occupier perspectives, this researchoffers new insight into the landlord tenant lease negotiation process.",
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Commercial leases in the UK regions: Business as Usual? / McCluskey, Danielle; Lim, Jasmine Lay-Cheng; McCord, Michael; Davis, Peadar.

Vol. 18, No. 4, 04.2016, p. 227-253.

Research output: Contribution to journalArticle

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AB - AbstractPurpose: This paper analyses the changing nature of commercial leases with specificreference to the landlord and tenant relationship, lease lengths and incentivisation in the postrecessionary UK property market.Design/methodology/approach: The research applies data analysis utilising the EstatesGazette Interactive database coupled with survey analysis conducted across three UK cities toinvestigate and compare the changing nature of the commercial property leasing market andthe landlord and tenant relationship.Findings: The empirical analysis highlights that recessionary conditions prevalent in themarket from the 2007 global crisis has caused a reassessment of lease structures leading toshorter lease terms and increased use of incentives, as tenants have been empowered tonegotiate more flexible leases due to their stronger market position.Originality/value: This paper builds upon previous research conducted back in 2005investigating commercial leases in the market up-cycle. The recent volatility in thecommercial property sector requires fresh insights and in-depth analysis of lease patterns,length and covenant strength, which is fundamental for investor decision-making. In addition,past research has tended to consider solely landlord or occupier perspectives, this researchoffers new insight into the landlord tenant lease negotiation process.

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