The new English Devolution and Community Empowerment Act 2026 (EDCEA 2026) (“the Act”) received Royal Assent on 29 April 2026 and will bring with it significant changes to commercial rent reviews provisions.

The Act will ban upwards-only rent reviews, which are currently and historically a standard provision in commercial leases. These, provide that rent will either stay the same or increase on review, but rent would not under any circumstances decrease, even if comparable market rents had fallen significantly. The ban will apply to new commercial leases and renewal leases in England and Wales across all sectors, from the high street, offices to industrial buildings and more.

While the Act is not in force yet, it is intended to come into effect around 2027. Until then, traditional upwards-only rent reviews can still be incorporated and will be enforceable throughout the term of the lease.

The Act may also impact existing tenancies. If a “tenancy renewal agreement” (“TRA”) is entered into on or after 17 March 2026, a future renewal lease completed on the basis of that agreement could still be caught by the Act even if the original tenancy started before the Act came into force. A TRA refers to agreements under which:

• A tenant can require the grant of a future tenancy, or
• A landlord can call upon the tenant to enter into a future tenancy.

Extension rights, options to renew, reversionary leases, and put and call option arrangements are potentially some of the things which can fall into the scope of a “tenancy renewal agreement”.

Existing leases will generally be protected as the Act does not interfere with existing rent review provisions, however you should exercise caution and take formal advice where an existing lease contains an option to renew, or extension rights are being exercised.

If you are a landlord, you should consider reviewing your standard leases, consider the implications of the rent review model you would like to use and then check whether you may require an alternative rent review provision going forward. You may need to exercise caution when it comes to long income investments or pre-lets.

If you are a tenant, you should carefully review your existing renewal rights and consider any current lease negotiations you might have ongoing, again taking legal advice if you are in any doubt. If you are currently negotiating a lease, you may want to challenge new long-term upwards-only structures which may shortly become commercially outdated.

For advice on lease structuring, rent review mechanisms in light of the upwards-only rent review ban, please contact Kira Luka-Langley at kira.luka-langley@maxengel.co.uk or Alice Truelove at alice.truelove@maxengel.co.uk, who are both in our Commercial Property department.

For any queries on contentious relationships with a landlord/tenant or a dispute you may have surrounding a lease, please contact Chloe May at chloe.may@maxengel.co.uk or Tiana Boanca at tiana.boanca@maxengel.co.uk, who are both in our Litigation department.

Our team is highly experienced in advising on lease structuring and landlord and tenant disputes and has handled numerous claims successfully.