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Legal Property Experts

COMMERCIAL LEASES: UNDERSTANDING A TENANCY AT WILL
When entering into a commercial lease arrangement, clarity and security are essential for both landlords and tenants. However, not all occupancy arrangements are based on long-term, formal leases. One flexible option is a tenancy at will. This type of agreement offers short-term convenience but also carries specific risks.
A tenancy at will is an agreement that allows a tenant to occupy a commercial property without a fixed term. Either the landlord or the tenant can terminate the arrangement at any time, with no notice (i.e. ‘at will’). While the agreement can be made in writing, it may also arise informally through the conduct of the parties. Tenancies at will are commonly used to allow early access to premises while lease negotiations are ongoing or when a temporary, flexible arrangement is needed.
The defining feature of a tenancy at will is its lack of a fixed duration. This means the arrangement continues only for as long as both parties are willing to maintain it. Once either party decides to end it, the tenancy comes to an end immediately.
There are several advantages for commercial tenants in using a tenancy at will. It allows immediate access to a property, which can be particularly useful during periods of business transition or while waiting for a formal lease to be completed. It is also ideal for temporary or seasonal use, such as pop-up shops or short-term projects. The absence of a long-term commitment offers tenants flexibility, especially when future space needs are uncertain.
However, a tenancy at will also involves significant risks - in particular the lack of security. The landlord can terminate the agreement at any time, so the tenant may be asked to vacate the premises with no warning. In addition, a tenancy at will does not offer the statutory protections provided by the Landlord and Tenant Act 1954, which means tenants have no right to remain in the property once notice is given. From a landlord’s perspective, care needs to be taken when drawing up a tenancy at will so that it does not unintentionally take effect as a periodic tenancy – which may then come within the protections afforded by the 1954 Act.
Legal advice should be sought before entering into such an arrangement, particularly to ensure that it suits the parties’ business objectives.
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