UK OCCUPIER SATISFACTION INDEX 2009 PROPERTY INDUSTRY ALLIANCE
AND CORENET GLOBAL UK
Home : Qualitative findings : Summary by question

How do you rate your level of satisfaction with the flexibility of leases within the UK, in terms of the ability to assign and sub-let?

Some occupiers believe that in the current market landlords are becoming more flexible about assigning and subletting, but many would like even more flexibility, and a more empathetic approach

There is a perception that the economic downturn has forced landlords to be more flexible 'Flexibility is changing because there is now more supply than demand. Landlords can no longer dictate as they did before.'

'This has improved due to the economic climate. Property owners are thinking that a bird in the hand is better than nothing.'
But the current economic conditions are making it harder to assign and sub-let 'Our problem is that we can't find anyone to assign our leases to. The economic situation has definitely had an impact on this.'

'You can assign if you want to but you need to find someone to take the space. It's always a struggle and it falls on the shoulders of the tenant.'
Many are dissatisfied with their ability to assign and sub-let, and feel that the landlord has the upper hand 'Leases are still way too onerous for the tenant, it's very hard to assign or sub-let.'

'The system is really designed, only for the landlord. Tenants are second class citizens in the equation. They have been slightly more flexible in the last 12 months, but as soon as the recession is over that will change again.'
Landlords are perceived to be unhelpful 'I think that the landlords' are very defensive and unhelpful when coming to sign our leases and very much stick to their legal stance. They are very inflexible and want the market rate.'

'Landlords now insist on authorised guarantees in order to sublet and this makes it harder for us to find the appropriate occupiers.'
Requirements on passing rent are perceived to be restrictive 'Landlords need to be more flexible about sub-letting at less than the passing rent. They need to face the market reality.'
Covenant strength can be an impediment 'We have a good covenant so this means that trying to assign to someone else is quite difficult.'

'I think this will get worse as landlords get even more paranoid about covenants and more awkward about who you can assign to.'
The process is frustrating, timely and costly 'We have to jump through so many hoops. Lawyers and third parties make it difficult.'

'We actively looked to sub-let our factory unit, but because of constraints from the landlord, costs and all the paperwork, we were unable to do it.'