Can I Walk Away from a Commercial Lease?
Walking away from a commercial lease isn’t as simple as handing back the keys. A lease is a legally binding contract, and if you leave early without following the right steps, there could be serious legal and financial consequences.
In most cases, you can’t simply walk away without consequences. Unless your lease includes a break clause – or your landlord has failed to meet their obligations – leaving before the end date could be considered a breach of contract.
Even if you vacate the property, you may still be liable for rent, service charges and other costs until the lease officially ends. Your landlord could also take legal action or pursue any guarantors named in the agreement.
That said, there are lawful ways to exit early. Whether your lease contains the right clauses, your landlord is open to negotiation, or you’ve experienced a breach on their part – it all comes down to what’s written in the agreement and how you approach things. We’ll walk you through your main options next.
How GloverPriest Can Help
Whether you’re under financial pressure, relocating, or dealing with a dispute, we’re here to help you explore your options. Our Commercial Lease Solicitors can review your agreement, explain your rights, and support you in finding a solution that protects your business.
Your Options for Ending a Commercial Lease Early
While you can’t simply walk away from a commercial lease, there are several legitimate ways to end it early (which largely depends on your lease terms and your landlord’s position). Here are the main options you could consider and/or discuss with a solicitor:
Break Clauses
A break clause is a provision in your lease that allows either you or your landlord to end the agreement early – usually at a specific point in the term. For example, a five-year lease might include a break at year three. If your lease contains one, this is often the most straightforward way to exit legally.
However, break clauses can still be complex and must be exercised correctly. That usually means giving formal written notice within a set timeframe, and making sure all conditions are met – such as being up to date with rent. If you miss a key deadline or fail to meet a condition, you could lose the right to break the lease altogether.
Surrendering the Lease (by Mutual Agreement)
If there’s no break clause or the timing doesn’t work, your landlord might agree to end the lease early by mutual consent. This is known as ‘surrendering’ the lease.
You’ll usually need to formalise this with legal documents that confirm both parties agree to end the lease. In some cases, your landlord might ask for a surrender premium or want you to cover their legal costs. However, if they're aware your business is closing or struggling, they may prefer to find a new tenant quickly and avoid potentially costly disputes.
Assignment or Subletting
If your lease allows it, you might be able to pass the lease on to someone else (assignment), or rent out part or all of the space to another business (subletting). These options can help you exit or reduce your obligations without breaching the lease - however it does depend entirely on your existing lease conditions.
Most leases require the landlord’s permission for either route. They may also impose conditions – such as providing a guarantor or proving the new tenant is financially stable. Importantly, even after assigning the lease, you could remain liable if the new tenant fails to meet their obligations.
What If the Landlord Breaches the Lease?
There are some situations where your landlord’s actions - or inaction - could give you a legal reason to end the lease. But even if they’ve broken the terms of the agreement, that doesn’t automatically mean you can walk away without consequence.
For example, if your landlord hasn’t carried out essential repairs, is interfering with how you use the premises, or has made changes without your consent, you may be within your rights to challenge the lease. In more serious cases, that could include asking to end it early.
That said, there’s a process involved. You’ll usually need to show that the breach is significant, give your landlord the chance to put things right, and take legal advice before making any decisions. Ending the lease too soon - or without warning - could still leave you on the hook for rent or other liabilities.
If you're unsure whether your landlord’s behaviour gives you grounds to leave, it’s worth speaking to a solicitor first. Every lease is different, and a conversation with a Commercial Lease specialist could help you avoid unnecessary risk.
What Happens If You Walk Away From a Commercial Lease Without Agreement?
If you leave a commercial lease without a valid reason or the landlord’s agreement, the risks can stack up quickly. Even if you’ve moved out, you’re still legally responsible for the rent, service charges and any other costs set out in the lease - until the term ends or a new agreement is reached.
In most cases, the landlord has every right to recover what’s owed. If there’s a personal guarantee in place, they could also come after you directly - not just the business. And if the lease includes a forfeiture clause, they might be able to reclaim the property and still pursue unpaid rent or losses.
There’s the reputational side to think about, too. Walking away from a lease without agreement could make things harder if you need to rent another premises or apply for business finance later on.
If you're finding it hard to stay on top of your lease or considering leaving early, it’s always worth getting advice first. There may be more options than you realise - and having someone in your corner can make all the difference.
What Happens at the End of a Fixed-Term Lease?
If your lease runs for a fixed term – such as five or ten years – it will usually come to an end when that period expires. What happens next depends on the lease terms and whether either party takes formal steps to renew or end the agreement.
If you’re planning to leave when the lease expires, you’ll usually need to give your landlord notice. In most cases, tenants are expected to give at least three months’ notice, while landlords must give six - though this can vary depending on the terms of your lease.
If you intend to renew the lease, and your agreement is protected by the Landlord and Tenant Act 1954, you can serve a Section 26 notice to request a new tenancy. This must be done between 6 and 12 months before the lease ends, and it formally notifies your landlord that you’d like to stay on under a new lease.
According to the UK government’s guide to “Terminating a commercial property lease early”, landlords can only refuse a renewal when leases are covered by the Landlord and Tenant Act 1954 in specific situations, including:
- you’ve failed to repair or maintain the property as set out in the lease
- you’ve repeatedly failed to pay rent on time
- you owe unpaid rent
- the landlord can provide another suitable property for your business
- you’re renting part of the property and the landlord wants to rent out the whole property
- the landlord wants to demolish or redevelop the property
- the landlord wants to live in the property or use it for business purposes
- you’ve broken any other part of the lease agreement
Your lease should say whether this protection applies - if not, our commercial lease solicitors can review your existing lease and check for you.
If neither party gives notice and you stay in the property, the lease may continue automatically under the same terms. This is known as a periodic tenancy. You’ll still be responsible for rent, service charges and all original conditions unless a new agreement is drawn up.
There are also rare cases of implied surrender, where both parties act as though the lease has ended – for example, you hand back the keys and the landlord takes over the space. But this can be legally tricky to prove, so it’s always safer to put everything in writing.
Final Thoughts
Walking away from a commercial lease isn’t something to take lightly - but that doesn’t mean you’re stuck with no way out. The key is understanding your rights, checking what’s in your lease, and getting advice before making any decisions.
Whether you’re coming to the end of your term, considering a break clause, or facing unexpected challenges, there may be more options than you realise. Sometimes a conversation with your landlord can open doors. Other times, it takes a more formal route to protect your position.
Either way, you don’t have to navigate it alone.
How GloverPriest Can Help
We understand how stressful it can be when a lease no longer works for your business. Whether you're looking to exit early, resolve a dispute with your landlord, or explore options like subletting or assignment, we’ll take the time to walk you through it all.
Our commercial property solicitors can review your lease, explain where you stand, and help you take the right steps - so you can move forward with confidence.
Ready to talk? Get in touch with a specialist commercial lease solicitor today:
FAQs
Can I walk away from my lease if my business is struggling?
If your business is under pressure, you might feel like you have no choice but to walk away – but the lease doesn’t just end because things have become difficult. You’re still legally bound by the terms unless your agreement includes a break clause or your landlord agrees to end it early.
That said, many landlords are open to discussion, especially if it helps them avoid a long vacancy. It’s always worth checking the terms of your lease and speaking to a solicitor first. There may be a way forward that avoids unnecessary cost or risk.
What happens if I stop paying rent and leave?
Leaving the property without an agreement doesn’t release you from the lease. You’ll likely still be responsible for rent, service charges, and any other costs until the lease ends or a new arrangement is made.
In most cases, your landlord can take legal steps to recover what’s owed. And if you’ve signed a personal guarantee – which many tenants do – they could pursue you directly. It’s a risky move, especially when there may be safer, more practical options available with the right advice.
What’s the difference between assigning and subletting a lease?
Assignment and subletting both involve bringing someone else into the picture, but they work in different ways. Assignment means transferring the lease to another business entirely – they take over your responsibilities, with the landlord’s consent. Subletting means you remain the main tenant, but you rent out all or part of the property to someone else.
Most leases set out whether these options are allowed, and in both cases, you’ll usually need the landlord’s permission. Even if they agree, you might still carry some responsibility if the new tenant falls behind on rent or breaches the terms.
How do I know if I have a break clause?
Break clauses are usually written into the lease, but they don’t always jump off the page. They set out when you - or your landlord - can end the lease early, and often include conditions like giving notice within a set timeframe or being up to date with rent.
If you’re unsure whether your lease includes one, it’s a good idea to have it reviewed. A solicitor can check the wording and explain exactly what your rights and options are.
What is implied surrender?
Implied surrender is when both you and your landlord act in a way that suggests the lease has come to an end – for example, if you return the keys and they re-let or start using the property themselves.
It’s not always straightforward, though. Without a clear written agreement, proving that the lease has legally ended can be difficult. If you think there’s been an implied surrender, it’s important to get legal advice before making any assumptions.
This article is for general information only and does not constitute legal advice. For guidance tailored to your specific situation, please speak to a qualified solicitor.