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Commercial Leases for SQE1

Part of our SQE1 Property Practice guide → View the full SQE1 Property Practice guide

03 Apr 2026

Commercial leases are a substantial part of the SQE1 Property Practice syllabus. You need to understand the key terms of a commercial lease, the statutory prote

Commercial Leases

Property Practice > Commercial Leases

What is Commercial Leases?

Candidates often lose marks on SQE1 by confusing the requirements for commercial lease terms with residential conveyancing — a distinction examiners test repeatedly.

Key Principles for SQE1

When tackling Commercial Leases as part of Property Practice, remember:

  • Know the procedural steps and their correct sequence
  • Understand the legal effect and consequences of each stage
  • Be familiar with the standard documentation and processes
  • Apply the rules to practical client scenarios

Understanding commercial leases is key to the pre-contract stage where you'll investigate title and advise the client on lease terms.

Exam Tip

Pay close attention to the order of steps in conveyancing scenarios. Exam questions often include answer options that describe correct actions at the wrong point in the transaction.

How This Appears in SQE1 Questions

SQE1 questions on this topic use transactional scenarios asking you to:

  • Identify the correct next step in the process
  • Select the appropriate document or search
  • Recognize the legal consequences of events
  • Advise on party obligations and timings

This is a classic SQE1 trap where examiners test whether you understand the unique requirements of commercial leases versus other property transactions.

Key patterns to watch for:

  • Questions that test whether you know the correct sequence
  • Scenarios involving both buyer and seller (or buyer and lender) obligations
  • Time-sensitive requirements and deadlines
  • Different procedures for different property types

Common Mistakes Students Make

Students often struggle with:

  • Confusing the order of steps in the conveyancing timeline
  • Applying rules from different stages to the wrong scenario
  • Overlooking procedural requirements
  • Forgetting time limits and deadlines

Quick Summary

  • Commercial Leases requires understanding both the law and the practical steps involved.
  • Work systematically through the procedural timeline and practise applying the rules to realistic scenarios.

Want to test this now? Try a few SQE1-style questions below before moving on.

Test Yourself

Test yourself

Quick check questions based on this article.

Question 1

Scenario

A solicitor is acting for a tenant who wishes to assign a 10-year commercial lease of restaurant premises. The lease was granted on 1 February 2018 and contains a fully qualified alienation covenant. The lease also contains a condition, agreed at the time of the grant pursuant to section 19(1A) of the Landlord and Tenant Act 1927, that the landlord may refuse consent to an assignment if the proposed assignee does not provide a rent deposit equal to six months' rent. The proposed assignee is willing to provide references and a personal guarantee from its director, but has refused to provide a rent deposit. The tenant's solicitor wrote to the landlord requesting consent to the assignment on 1 March. The landlord has not responded to the request for consent. It is now 1 May. The tenant has asked the solicitor to advise on the position. The proposed assignee has been trading successfully in the restaurant business for eight years. The rent under the lease is £60,000 per annum. The landlord's managing agent has informally indicated that the landlord is not opposed to the assignment in principle but is concerned about the absence of a rent deposit. The tenant is keen to complete the assignment as quickly as possible because the proposed assignee has threatened to withdraw if the matter is not resolved within the next month.

Which of the following best describes the position regarding the landlord's failure to respond?

Question 2

Scenario

A tenant occupies commercial premises under a five-year lease that was granted in 2020. The lease is protected by Part II of the Landlord and Tenant Act 1954. The lease is due to expire by effluxion of time on 30 September 2025. The landlord wishes to oppose the grant of a new tenancy. The landlord served a section 25 notice on the tenant on 1 March 2025, specifying a termination date of 30 September 2025 and stating that the landlord would oppose any application for a new tenancy on the ground that the landlord intends to demolish or reconstruct the premises. The landlord has obtained planning permission for a substantial redevelopment of the building and has entered into a building contract with a reputable construction company. The construction works are scheduled to begin on 15 October 2025. The tenant served a counter-notice within the required time period, indicating that the tenant is unwilling to give up possession. The tenant has now applied to the court for the grant of a new tenancy. The tenant argues that the landlord cannot satisfy the ground of opposition because the works could be carried out without the tenant giving up possession, as the tenant occupies only the ground floor and the works primarily affect the upper floors. The landlord argues that access through the ground floor is essential for the construction works. The tenant has been an exemplary tenant throughout the term, paying rent punctually and maintaining the premises to a high standard.

On what basis is the court most likely to determine whether the landlord can successfully oppose the grant of a new tenancy?

Question 3

Scenario

A solicitor acts for a tenant taking a new 15-year lease of a commercial warehouse. The landlord's solicitor has sent a draft lease for approval. The draft lease contains a full repairing and insuring covenant requiring the tenant to keep the premises in good and substantial repair and condition throughout the term. The solicitor inspects the premises with the tenant and notes that the roof has some visible wear and the external brickwork shows signs of age-related deterioration. The premises are approximately 30 years old. The tenant is concerned about being required to carry out extensive repairs to the roof and external walls that pre-date the commencement of the lease. The solicitor considers what steps can be taken to protect the tenant. The landlord has indicated that the rent has been set at a level reflecting the current condition of the premises. The tenant is a medium-sized logistics company with a turnover of £8 million per annum. The tenant asks the solicitor whether there is a way to limit the repairing obligation to the current state of the property rather than requiring it to be put into a better condition.

What is the most appropriate step the solicitor should recommend to protect the tenant from liability for pre-existing disrepair?

Practice with full exam-style questions

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Practise Commercial Leases Questions for SQE1

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