What could a ban on Upward Only Rent Reviews mean for commercial leasing?

The government has introduced a bill proposing a ban on Upward Only Rent Reviews (UORRs) in new commercial leases.

The English Devolution and Community Empowerment Bill, announced on 10 July 2025, proposes reforms that would represent a significant shift in the landscape of commercial leasing. Our real estate experts explore the proposed ban on Upward Only Rent Reviews, its implications for landlords and tenants, and what it could mean for the future of commercial leases in England.

Overview of the Devolution and Community Empowerment Bill

The wider bill seeks to strengthen local communities, support small businesses, and enhance local decision-making through a number of reforms. You can read the bill here.

One of the bills’ surprise provisions was the proposed ban on Upward Only Rent Review clauses in commercial leases completed on or after the bill’s enactment. Although the bill is still under parliamentary review and subject to change, the proposed changes represent a landmark development in commercial property law.

How are UORRs currently used?

UORRs are commonly included in commercial leases and are generally regarded as standard practice by lawyers and property professionals alike. Rent reviews are typically based on the open market value of comparable properties in the same area. If similar properties command higher rents, landlords may increase rent accordingly. However, if the market value declines, landlords are not obligated to reduce rent in order to reflect this, and instead, can keep the rental value the same.

This structure provides landlords with income stability but could disadvantage tenants, who may face unchanged or increasing rent despite actual market conditions. The proposed ban would allow rental values to fluctuate in both directions, aligning more closely with the nature of the market.

What would the change in legislation mean for tenants and their rights?

Under the government’s proposed bill, tenants would gain a new legal right to initiate rent reviews, without solely relying on landlord action.

What would this mean for stepped rent and are there any potential workarounds?

The bill does not prohibit fixed rent increases, commonly known as stepped rent. Landlords may still include predefined rent increases in lease agreements, provided these are clearly specified from the outset. This ensures transparency and predictability for tenants.

Although the proposed ban on Upward Only Rent Reviews cannot be opted out of, the bill allows for future regulations to introduce exceptions. However, the nature of these exceptions remains a discussion point for parliament.

What would the ban on Upward Only Rent Reviews mean for landlords and tenants?

The proposed ban on Upward Only Rent Reviews represents a significant shift in commercial leasing practice. By encouraging greater flexibility, the proposed bill aims to better balance the interests of landlords and tenants.

As the bill progresses through parliament, those with an interest should stay informed and consider how they may be impacted by these changes.

For further guidance on how these changes may affect your business, please contact our expert real estate team.

Acting for local, national and global clients, our Legal 500 and Chambers-rated real estate team has outstanding technical expertise to advise on a huge range of property transactions and non-contentious construction issues.