The commercial lease renewal process can be engaged in two ways:
By the landlord serving notice on the tenant under Section 25 of the Act to bring the existing tenancy to an end and propose terms for a renewal lease; or
By the tenant serving notice on the landlord under Section 26 of the Act to bring the existing tenancy to an end and propose terms for a renewal lease.
Whether the renewal is at the request of the landlord or the tenant, the requisite notice must be in the prescribed form and provide the appropriate statutory notice period. Moreover, if the contractual term of the existing lease has not yet expired (therefore the tenancy is not “holding over” under Section 24), the end date within either party’s notice cannot be before the expiry of the contractual term. These considerations can become the pitfalls of the unwary party and can invalidate their notice.
Usually, the parties will use the statutory notice period to negotiate the terms of the renewal lease. However, if a new lease is not agreed upon and entered into by the expiration of the notice period, the tenancy will come to an end and the tenant will lose their rights of occupation unless an extension to the statutory notice period is formally agreed in writing between the parties or one of the parties (usually the tenant, on the basis that key terms such as rent and term of the renewal lease cannot be agreed) issues a claim to request a new tenancy from the Court.