Press release: 1st December 2009

 
DTZ Sherry FitzGerald have today criticised the decision by Minister Dermot Ahern to enact the draft legislation banning upward only rent reviews. Section 132 of the Land and Conveyancing Law Reform Act is due to come into operation on 28th February 2010. DTZ Consultancy Director, Peter Waller, said that the enforcing of this new legislation will do nothing to help occupiers in the retail, industrial or office markets in coping with high levels of rents they are currently paying. Market forces had already corrected this practice in new leases and Mr Waller went on to say that “many leases that have been signed in 2009 contain mechanisms other than upward only rent review clauses”. Mr Waller went on to say, “the market will now be split into two where upward only leases will be virtually impossible to assign as the legislation cannot be retrospective”. 


While a ban on upward only rent reviews may benefit certain occupiers signing new leases, the implementation of this provision is likely to have a significant negative impact on investment values for future development. Together with the recently announced Windfall Tax, this ban will further reduce the value of properties transferring to NAMA.


For further information contact:

Peter Waller

Email: peter.waller@dtz.ie

Direct Tel: +353 1 639 93 22

Direct Fax: +353 1 639 93 99