Factors Influencing the Commercial Real Estate Development and Regeneration in London Free Essay Example, 3000 words

In the 1990s many changes were seen in the UK standard institutional leases. The lease normally had the lengthy-term, ranging from 20-25 years or more; the landlord had more control over the disposal of the lease by the tenant, lease payments were subjected to upward revisions on a periodic basis depending on how the open market rents moved. Earlier responsibilities vested with the landlord were transferred to tenants either in physical form or via monetary charges. These included insurance, repairs, and maintenance, or any other replacements. These changing trends led to larger developments in the area. But today, the trends are largely changing modern businesses no more have huge planning horizons, in fact, these have shortened to three to five years. Thus, the increase in lease terms for twenty to twenty-five years brings in huge costs and ties the business for a very long time and brings in larger inflexibility. This nature of lease diverts attention from the main business oper ations and the clause for one direction (only upwards) was in favor of landlord whereas, the tenant was devoid of taking any advantage in times of falling market prices; highly affecting the business profitability. We will write a custom essay sample on Factors Influencing the Commercial Real Estate Development and Regeneration in London or any topic specifically for you Only $17.96 $11.86/page The three office buildings, retail space and car parking at Canary Wharf were structured from this huge financing.