Gemma Cook
- Knowledge Director
- Real Estate
Quarterly in Advance: Commercial Real Estate – What is on the Horizon?
In this edition of Quarterly in Advance, our Knowledge Director, Gemma Cook, consolidates the significant announcements made by the Government in recent weeks into a handy summary and highlights what may be next. If any of the matters raised in this summary affect your investment, occupation or development strategy, please speak to your usual contact in the team.
Ban on upwards-only rent reviews: Act receives Royal Assent, but the commencement date is yet to be confirmed
The Government has implemented the surprise ban on upwards-only rent reviews (“UORRs”) in commercial leases that was tucked away in a bill that mostly concerned matters of devolution. On 29 April 2026, the English Devolution and Community Empowerment Act 2026 (“Act”) received Royal Assent.
The relevant provisions are yet to be brought into force. The industry suspects the date will be in 2028 but, the industry also did not expect the Act to be passed so quickly.
Once in force, there will be a statutory ban on UORRs in commercial leases (whether within the security of tenure provisions of the 1954 Act or not). This means that a rent review mechanism which would have sought to prevent rent from falling will have the “upward‑only” element disapplied. It must be possible for the revised rent to move upwards and downwards or be ascertained at the commencement of the lease (i.e. a stepped rent).
The Act also has a knock-on effect for alienation drafting. Where an existing lease requires a sublease to contain an upwards‑only rent review, that requirement will be ineffective once the relevant provisions are in force.
Whilst in most cases leases granted or agreements for lease entered into before the commencement date may still include and operate UORRs, there is an element of retrospectivity for renewal options and renewal arrangements with existing tenants. Where a renewal option or contractual renewal arrangement was entered into on or after 17 March 2026, the ban will apply to the renewal lease once it is granted and the ban has come into force. This was introduced into the Act as an anti-avoidance mechanism and does leave us with timing uncertainty while we wait for the commencement date.
Practical takeaway: landlords and tenants may wish to explore alternative rent structures early (particularly where future renewals are contemplated).
New register of contractual controls edges closer
Part 11 of the Levelling-up and Regeneration Act 2023 (“LURA“) sets out the framework for a new regime designed to improve transparency regarding land ownership and control of land. That regime moved a step closer in March as the Government published a draft set of regulations fleshing out the detail of the new regime.
Once the regulations are made, there will be a duty to register information about options, pre-emptions and conditional contracts where those agreements give a person the ability to control how land is used or developed. There are certain exemptions, such as short-term rights of control for less than 18 months.
The register will be a new separate public register managed by the Land Registry. The detail about how to submit applications and how to search the new register are not yet published. Often these types of agreements are registrable at the Land Registry in any event so there will need to be two submissions. The Land Registry may not deal with the usual Land Registry applications if the contractual control information has not also been registered.
The regulations are expected to be made shortly and come into force on 6 April 2027. Transitional arrangements will apply to those agreements entered into after the regulations are made but before 6 April 2027. For those agreements, the required information must be submitted by 6 October 2027. After 6 April 2027, the information must be submitted within sixty calendar days.
The register is being set up to help deliver the three purposes under LURA:
- Beneficial ownership (England and Wales): information that appears to the Secretary of State to be useful for identifying individuals who are beneficial owners of land in England or Wales.
- Contractual control (England and Wales): information that appears to the Secretary of State to be useful for understanding relevant contractual rights (including who holds them, why they exist and the circumstances in which they were created or acquired).
- National security (UK-wide): disclosure justified in the interests of national security in relation to land where the location, or anything situated or done on it, gives rise to a threat to national security.
Practical takeaway: for development land and strategic acquisitions, expect contractual control agreements to become a visible compliance item. The new register relates to the ‘contractual control purpose’ of LURA. There will be more to come in line with the other two purposes of LURA.
Building safety
Wales and building safety
The Building Safety (Wales) Bill received Royal Assent on 27 April 2026 and is now known as the Building Safety (Wales) Act 2026 (“BSWA“). The substantive provisions of the BSWA will be brought into force on a day to be appointed by the Welsh Government.
The BSWA is broader in scope than the English equivalent as the definition of a higher-risk building in Wales only requires one residential unit rather than two. The 18m height or seven storey criteria remain aligned with England.
Residential Personal Emergency Evacuation Plans (“RPEEPs”) in England
From 6 April 2026 a key recommendation of the Grenfell Tower Inquiry came into effect. New rules now require carefully thought-out evacuation plans for residents who may need help to escape in a fire. The ‘responsible person’ of:
- A high-rise building (18 metres high and/or seven or more storeys); or
- A medium-rise building (11 metres and above) that has a simultaneous evacuation strategy in place;
that contains two or more sets of domestic premises, must, amongst other things, identify residents who may need help to get out in a fire, carry out a personal assessment and provide a written emergency evacuation statement. When buying or selling a multi-residential let or a mixed-use building, these will become an important due diligence consideration.
The ‘responsible person’ in this context could be a different person to the ‘accountable person’ for the purposes of the Building Safety Act. The responsible person, broadly speaking, is the person who has control of the premises (as occupier or otherwise), so typically the building owner or the building manager.
Practical takeaway: owners and developers should confirm early who the ‘responsible person’ is and ensure building information and resident engagement processes can support compliant assessments and statements.
Energy: Minimum Energy Efficiency Standards (“MEES”) for commercial properties
The Department for Energy Security and Net Zero (“DESNZ“) has updated guidance on MEES for non-domestic private rented property to highlight a new service for landlords in England and Wales. Users can now search the register for exemptions and penalties related to MEES, including properties with registered exemptions or penalties. Commercial properties requiring an energy performance certificate (“EPC“) must have an EPC rating of E or above or a valid exemption. There is still no clarity on any revised EPC rating requirements for commercial properties. The 2020 Energy White Paper suggested a future trajectory for MEES of EPC B by 2030, but that has not yet been implemented.
Practical takeaway: landlord and tenants should factor upgrade capex and letting/occupational strategy into programmes and valuations.
Business rates
From 1 April 2026, new rateable values under the 2026 business rates revaluation apply to non-domestic properties in England and Wales. Rateable value changes will not automatically translate into the same level of increase (or decrease) in rates payable, as councils apply the relevant multiplier(s) and any reliefs, but this revaluation will be an important budgeting and valuation consideration for owners and occupiers alike. Those with assets under development or refurbishment should also keep a close eye on the property details and assumptions underpinning the valuation and consider whether any mitigation is available through reliefs or transitional arrangements.
Practical takeaway: investors, developers and occupiers should review 2026 list valuations as part of budgeting and transaction due diligence, and sanity-check the property facts/assumptions used to derive the rateable value.
Renters’ Rights Act 2025
The first phase of measures under the Renters’ Rights Act 2025 came into force on 1 May 2026. The Government has announced its intention to legislate to ensure that tenants are not brought into scope of SDLT on rent as a result of the changes introduced.
The second phase (likely from late 2026) is expected to introduce a new database of private rented sector properties and establish a Landlord Ombudsman to improve dispute resolution.
Practical takeaway: for landlords and investors with residential exposure (including mixed-use schemes), expect increased transparency and enforcement risk.
Still to come
Whilst many of the headline areas of reform are now a little more certain given the list above, there are still other areas of reform that we are yet to hear more on. These are:
| Theme | Legal Point | Commentary |
| The King’s Speech May 13 2026 | The Government’s proposed policies and legislation for new Parliamentary session include:
|
A confirmation of the Government’s desire to reform the leasehold system (including the capping of ground rents) by way of the Commonhold and Leasehold Reform Bill. This Bill is at pre-legislative scrutiny stage.
The Remediation Bill is the Government’s way of speeding up remediation for people living in homes with unsafe cladding. The proposal is a new legal duty to remediate defective cladding together with another new register for mid-rise buildings (11–18 metres) in England requiring remediation. Meanwhile, the industry is still grappling with the regimes established by the Building Safety Act 2022 and the BSWA. |
| Commercial leasehold reform
|
Business tenancies and the right to renew | Part Two of the Government’s consultation on the Landlord and Tenant Act 1954 (“1954 Act“) which is due to focus on improving the exclusion process under the 1954 Act was due in Spring 2026. |
| The consultation on permitted insurance fees | The consultation closed in July 2025 and indicated widespread leaseholder concerns. This is also interesting given the awaited hearing for London Trocadero (2015) LLP v Picturehouse Cinemas Ltd (See below). | |
| Landlord and Tenant (Covenants) Act 1995 and rights of first refusal under the Landlord and Tenant Act 1987 (as they apply to commercial premises) | Further detail and timings are yet to be confirmed. Watch this space for further intel as and when we know it. | |
| Project on maintenance, repair and upgrading of leased commercial buildings | ||
| Telecommunications works | Changes to works for mobile masts and fibre-optic cabling installation within HRBs
|
A new consultation was launched on 27 January 2026 by the Ministry of Housing, Communities, and Local Government (“MHCLG“) as the current procedural process for these types of building work in HRBs involves Gateway 2 which is considered, by some, to be disproportionate to the level of risk involved. The consolation closed on 24 March 2026. |
| Chancel repair | The project aims ensure that chancel repair liability does not bind purchasers of land unless it is registered. | The consultation closed on 15 November 2025. |
Dates on the horizon
As a handy aide-mémoire, we list below the known dates for some key decisions that the industry awaits:
| Theme | Commentary | Key date |
| Building Safety | The Building Safety Levy | Takes effect on 1 October 2026. |
| Almacantar Centre Point Nominee No.1 Ltd v De Valk
Service charges and unsafe cladding under the Building Safety Act 2022 and whether the protections in paragraph 8 of Schedule 8 apply regardless of when the cladding was installed and are not limited to ‘relevant defects’. |
The Court of Appeal is due to hear the appeal on 15 October 2026. | |
| Adriatic Land 5 Ltd v Long Leaseholders at Hippersley Point
Whether paragraph 9 of Schedule 8 prevents recovery of service charges associated with legal and professional costs related to safety defect liabilities under qualifying leases for liabilities incurred before 28 June 2022. |
The Supreme Court granted permission to appeal in part on 6 November 2025. Date of hearing is unknown. | |
| Triathlon Homes LLP v Stratford Village Development Partnership
Whether the Court of Appeal is wrong to conclude that a remediation contribution order under s124 Building Safety Act 2022 can be made in respect of costs incurred before that provision came into force on 28 June 2022. |
The Supreme Court granted permission to appeal in part on 6 November 2025. Date of hearing is unknown. | |
| Insurance and landlord commissions
|
London Trocadero (2015) LLP v Picturehouse Cinemas Ltd
Whether the landlord of commercial premises had been significantly overcharging its tenant insurance rent by taking a commission as part of the insurance premium. |
The Court of Appeal is due to hear the appeal on 3 June 2026. |
To close
2026 is already the year of substantial change for the commercial real estate industry. Wedlake Bell will continue to monitor developments and keep you informed. If you would like to discuss how any of these issues may impact your portfolio or activities, please get in touch.
This article is for general information purposes only and does not constitute legal advice or a comprehensive statement of the law. Specific legal advice should always be sought in relation to individual circumstances.
This article is for general information purposes only and does not constitute legal advice or a comprehensive statement of the law. Specific legal advice should always be sought in relation to individual circumstances.
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