AZ Property Limited owns the freehold of a small shopping centre comprising 4 units, which are all subject to leases.  The centre has not been performing well in recent years and AZ Property is considering redeveloping it when the leases of the 4 units come to an end

  • Unit 1:
  •   The tenant has been using this unit as a restaurant since the lease was granted to them 4 years ago.  The lease expires on 24 December 2017 and contains a clause stating that the provisions of sections 24 to 28 of the Landlord and Tenant Act 1954 are excluded in relation to the tenancy.  AZ Property’s solicitor has confirmed that they are holding the original statutory declaration with the deeds and that the contracting out procedure has been completed correctly.  
    1. Unit 2:
      There is a lease in place for Unit 2 which expires on 19 December 2017.  The lease does not include wording excluding sections 24 to 28 of the 1954 Act and the solicitor has confirmed they do not have a statutory declaration in respect of this lease. The premises were used as a toy shop when they were first let but the unit has been empty since June 2016.  
    1. Unit 3:
      Unit 3 was also vacated in September 2016.  AZ Property found a new tenant and granted them a lease in October 2016 for 5 months, with no right to renew at the end of the initial term.  The property is being used as a shoe shop.  
    1. Unit 4:
      Unit 4 is let to a local business owner who is using the property to store stock for his clothes shop located a few roads away from the centre.  The lease expires on 14 December 2017 and does not include wording excluding sections 24 to 28 of the 1954 Act.  The solicitor has confirmed they are not holding a statutory declaration in respect of this lease.  
    1. Unit 5:
      Unit 5 has been empty since July 2016 and AZ Property is keen to achieve some income for the unit before the planned redevelopment.   Advise AZ Property:
    1. Whether any of the leases for Unit 1 to 4 have security of tenure under the Landlord and Tenant Act 1954
     
    1. What procedure AZ Property will have to use to end any tenancy that has security of tenure, and whether they are entitled to do so
     
    1. What steps AZ property should take in respect of Unit 5
    You should make reference to statute and case law as appropriate in support of your advice.  

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