Your office lease costs may have spiked by 5% or more over the last year because of a rent review, rising market rents, changes to business rates, service charges or other costs passed on under the lease.
When this price increase comes in, it is essential to double check your initial lease and see if a price increase is permitted – since this is a legally binding agreement that your landlord must uphold.
If you are unhappy with this increase, you can challenge your landlord and follow options such as negotiating, break the clause or surrendering early.
Key takeaways:
- Check why costs have increased: Rent reviews, service charges, insurance and business rates can all increase the overall cost of occupying an office.
- Review your lease before accepting an increase: The landlord must follow the terms of the lease, and some increases may be open to challenge if the correct process has not been followed.
- Know your options: If costs become unaffordable, you may be able to negotiate, use a break clause, assign or sublet the lease, or agree an early surrender with the landlord.
How much do office leases increase year on year?
In many UK regional markets, office rents are currently expected to increase by around 1% to 5% a year. However, some areas are seeing much larger increases.
For example, prime office rents in the City of London increased by 12% in one year in 2026. In Mayfair and St James’s, rents increased by around 18% over the same period.
Why do lease costs increase or stay the same?
Office lease costs do not always rise simply because the landlord decides to charge more. Your lease will normally explain when and how rent can be reviewed.
Some leases include fixed annual increases, while others use rent reviews linked to market values or inflation. Service charges can also increase when the cost of maintaining a building, providing security, cleaning, insurance or other services rises.
Business rates are another important factor. Although business rates are separate from rent, they form part of the overall cost of occupying an office. The 2026 revaluation is based on property rental values from 1 April 2024.
Market conditions can also have an effect. RICS reported in 2026 that prime office rents were expected to grow by around 2% over the following 12 months, with London expected to see growth of around 2.5%.
It is legal to increase lease costs for an office?
It can be legal to increase your office lease costs, but the landlord must follow the terms of your lease.
A commercial lease is a legally binding agreement. If it contains a rent review clause, the landlord may have a contractual right to increase the rent when the review date arrives.
However, the landlord cannot normally ignore the agreed process and simply impose any increase they choose. The wording of the lease matters, including how rent is calculated, when it can change and whether there are limits on increases.
You should also check whether the increase is actually rent. A higher invoice could include service charges, insurance, business rates or other recoverable costs.
What can I do if my lease costs increase?
Start by checking your lease and comparing the latest invoice with previous ones. Identify exactly which part of the cost has increased.
Ask the landlord or managing agent for a clear breakdown if the reason is not obvious. If the increase relates to a rent review, check the review date and the calculation used.
If business rates are responsible, check your property’s current rateable value. The 2026 Business Rates revaluation applies from 1 April 2026 and new values will generally be used until 31 March 2029.
It may also be worth speaking to a commercial property solicitor or surveyor. They can review the lease and advise whether the increase appears to follow the agreed terms.
Can I challenge an increase in my office lease cost?
Yes, in some circumstances, you may be able to challenge an increase.
The first question is whether the landlord has followed the lease correctly. A rent review carried out using the wrong date, calculation or procedure could potentially be disputed.
You may also be able to challenge a business rates assessment if you believe the property’s rateable value is incorrect. The Valuation Office provides a process for checking and challenging rateable values.
Negotiation is another option. Even where an increase is allowed under the lease, you may be able to agree different terms, particularly if you are a reliable tenant and the landlord wants to avoid the cost and uncertainty of finding someone new.
What are my options if I want to get out of an office lease?
If the increased cost makes the office unaffordable, check whether your lease contains a break clause. This may allow you to end the office lease on a specified date, provided you meet the conditions.
You may also be able to assign the lease to another business or sublet the premises, although landlord consent may be required.
In some cases, negotiating an early surrender with the landlord may be possible. The landlord may agree to release you from the lease in return for an agreed payment or other conditions.
Do not simply stop paying rent or leave the property without advice. Commercial leases can create significant liabilities, and leaving without following the correct process could leave your business responsible for rent and other costs.
With office occupation costs changing, the best approach is to understand exactly why your costs have increased, whether the increase is permitted by your lease, and what options you have before agreeing to pay more.
