A lease is a commercial contract creating an interest in a building, property, or in land, as well as imposing obligations and liabilities upon the parties. By definition, a lease will be for a fixed term (a specified time), and the lease will terminate at the end of its contractual term. When the lease comes to an end in the natural way, i.e., at the end of the term, this is known as ‘determination by ‘effluxion of time’, subject to any agreement (or statutory right under the Landlord and Tenant Act 1954) to renew or extend the lease term. Should a tenant wish to terminate the lease before the term has expired, they would need to do so by agreement with the landlord (which may be at the price of a premium and other conditions), by exercising a break right (in accordance with a tenant’s break clause in the lease), or by assigning (transferring) or subletting their interest in the property, to a new tenant.
You can find out further information about terminating a commercial lease in our recent article.