If a Tenant has an option to renew a lease for a period of time, the Landlord cannot refuse the extension, if it is written into the lease. In most cases the lease stipulates that the Tenant has the option to renew the lease at the Market Rate, at the expiry date of the initial lease. The market rate can be determined by arbitration. Very few Landlords will stipulate a rental for the option period. However Tenants can insist that the rental for the option period not exceed a certain percentage. Say 10% or 15% higher than rental at the expiry of the initial lease. This would obligate the Landlord to a rental for the option period, if Tenant gives the correct notice to Landlord of his intention to take up the option.
Jun 21, 2014