A structural shift, not a technical tweak
From a legal perspective, the ban is tightly defined. It targets rent review mechanisms where the reviewed rent is not known or capable of being determined at the date the lease is granted. In practice, that means traditional open market and index-linked upwards only reviews will fall away, while fixed or stepped rents, and genuinely upwards and downwards market reviews, are expected to remain compliant.
That distinction matters, but it should not obscure the wider point, the old upward only market rent review model will no longer exist.
Why today’s renewal terms could shape tomorrow’s rent
A significant element of the legislation is a late amendment introducing limited retrospective effect.
Where a lease is granted pursuant to a “tenancy renewal arrangement” entered into on or after 17 March 2026, for example, an option to renew the lease, the new lease will be caught by the ban even if the renewal itself takes place after the implementation date. Importantly, the restriction bites not only on future rent reviews, but also on the initial rent payable on day one of the renewal lease.
This amendment effectively closes an anti-avoidance scheme, meaning landlords can not have the benefit of the pre-implementation date upward only system for renewal leases before the legislation comes into force.
What this means for landlords and investors
For landlords and investors, the conversation is shifting away from whether the ban is a good idea, and towards how income security is achieved in a world without UORR.
We are already seeing greater focus on:
- Shorter lease terms with more frequent fixed or stepped rent uplifts;
- Turnover based or hybrid rent models, particularly in retail and leisure; and
- Early interest in whether caps and collars may emerge as an acceptable compromise. The government has confirmed that it will consult on the use of rent caps and collars before implementation, but there is no certainty yet on how far these will be permitted.
From an asset management perspective, this is less about finding a one-for-one replacement for UORRs, and more about re‑evaluating and possibly stress-testing portfolio assumptions. There will not be an immediate re-basing of current rental income for landlords. But consideration will need to be given when considering future projections and modeling.
And for occupiers?
For tenants, the reform removes a long-standing structural imbalance, but it does not eliminate complexity. The detail of open market rent review drafting, trigger mechanisms and valuation assumptions will matter more, not less. In particular, tenants negotiating renewal options now should understand that open market review as a mechanism is still available, although it appears as though landlords will be keen to agree stepped rents where the headline rent on renewal will prescribe a stepped increase, even if market conditions would otherwise support a nil increase or a lower increase.
In short, bargaining power may change, but careful drafting remains critical.
Looking ahead
It would be a mistake to treat the UORR ban as a future compliance issue. The market is already adjusting, and those adjustments are happening lease by lease.
My advice to clients is simple:
- Understand which of your current negotiations may already be in scope;
- Revisit standard precedents, particularly around renewal mechanics; and
- Approach lease structuring strategically, rather than assuming historic models will continue to hold.
The ban on UORR is not just a legal change, it is another significant change in the commercial leasing landscape. Those who engage with it early will have far more control over the outcome than those who wait for commencement and react under pressure.