BCO panel calls for offices to be exempt from upward-only rent review ban

A British Council for Offices (BCO) panel has called on the government to exempt offices from the ban on upward-only rent reviews, arguing the measure puts overseas investment in UK offices at risk.

The panel, hosted by Savills, brought together Geoff Scodie, head of City asset management at British Land, Will Densham, partner and head of real estate litigation at Eversheds Sutherland, and Tom Whalley, director of lease consultancy at Savills, with BCO chief executive Samantha McClary.

According to the BCO, the ban sits in the English Devolution and Community Empowerment Act 2026, which has Royal Assent but is not yet in force. A consultation on caps and collars, and the secondary legislation needed to bring the ban into effect, are still to come.

Geoff Scodie, head of City asset management at British Land, said: "The ban was something everyone panicked about for about four weeks and then started ignoring."

The legislation

The Ministry of Housing, Communities and Local Government announced on 29 April 2026 that the Bill had received Royal Assent. The government said the Act bans upward-only rent review (UORR) clauses in new and renewal commercial leases.

The Bill was introduced to Parliament on 10 July 2025. At the time the government said UORR clauses pit landlords against businesses, and that banning them would help keep small businesses running and boost local economies and job opportunities.

Section 100 of the Act inserts a new section 54A into the Landlord and Tenant Act 1954, with Schedule 7A making provision about rent reviews. Schedule 37 inserts the new Schedules 7A and 7B into the 1954 Act.

The BCO reported differing views on when the caps-and-collars consultation will arrive: some expect it next summer, while others think it will be pushed back to 2028.

Investor impact

Densham told the panel that too many people still assume the ban will never happen, describing it as a "matter of when, not if". He said he did not expect a collar to be agreed, even alongside a cap, because government would see it as a restriction on downward movement by another name.

Stephen Down, chairman of central London & international investment at Savills, who has spent more than 40 years in the market, told the panel he was frustrated at how little push back there had been. He relayed a meeting with investors planning substantial investment in London offices who told him they would likely invest less if downward reviews arrive.

Scodie offered a different experience, according to the BCO. He said German funders, regarded as among the most risk-averse in the market, seemed relatively relaxed and were still writing five-year refinancings on office assets.

Headline and net-effective rents

The panel agreed that large incentives create a gap of about 20% between headline and net-effective rents, and that in the City 24 months rent-free on a 10-year term is not unusual. A review that can go down, it said, risks resetting rents to that discounted level even in a rising market.

Whalley is working with clients on a mechanism that measures the net-effective rent at the start of the lease and again at review, then applies the percentage change to the passing rent.

The BCO said the market is already adapting to the threat that agreements for renewal leases entered into after 17 March 2026 can be caught retrospectively by the ban. Whalley described landlords seeking indexation in agreements for lease, projecting about 20% growth over five years, with deals reaching stalemate and being rescued only by restructuring to sit outside the retrospective rules.

After the ban, the panel expects more stepped rents and indexation on larger deals, shorter leases on smaller space, and leases sitting outside the 1954 Act.

Its practical advice was to draft leases as if the Act were already in force. The group unanimously believed offices should be exempt.

Wider industry position

The British Property Federation (BPF) has told government it does not support the blanket ban, in a policy blog by its director of policy Ion Fletcher dated 12 December 2025. The BPF argues that pension funds and insurance companies need predictable long-term income streams to pay long-term liabilities, and that the ban makes that income less predictable.

Melanie Leech, the BPF's chief executive, said in September 2025 that the measure would not affect many retail leases but would instead affect sectors such as offices and logistics, and the ability of long-term investors to invest in modern workplaces. She said the way the announcement was made, without warning or consultation, had spooked investors.

Call for evidence

The BCO has launched a call for evidence from occupiers, investors, developers and advisers on the impact of applying the ban to office deals.

Those wishing to contribute should email mail@bco.org.uk with the subject line UORR.