Code of Practice for Leases is non-starter

Tenants are still hesitant to sign up agreements under the new Code of Practice for Commercial Leases, according to figures released by Land Securities

Between 1 November 2002 and 31 January 2003, only 2 per cent of leases signed up by Land Securities were under the code.

Of the 179 leases signed in the period, just four were agreed under the new lease code that was implemented last April. However, of the 179, half fell outside the scope of the code and another 60 opted for a traditional lease.

Although only four leases were signed under the code itself, another 25 tenants opted for a flexible pricing alternative offered by Land Securities.

SJ Berwin partner Jon Vivian said: “The large property companies and institutions are offering differently priced alternatives, but it [the code] does need people to take that up.”

He added that some smaller companies were not yet offering flexible alternatives to the same extent that their larger counterparts are.