Reforms around Lease extension and freehold enfranchisement
The Government has recently reconfirmed its proposal to implement reforms in this regard in the current term of Parliament.
Legal Updates
Right To Manage
The Upper Tribunal (Lands Chamber) has provided clarification on the meaning of a “self-contained building” for the purposes of the right to manage (“RTM”) under the Commonhold and Leasehold Reform Act 2002 (“CLRA 2002”).
The decision is particularly significant in light of that expansion of the RTM regime. Since 3 March 2025, leaseholders in mixed-use buildings have been able to exercise the right to manage where the non-residential element comprises up to 50% of the building’s internal floor area, compared with the previous 25% threshold.
Landlords Beware
Landlords beware; commercial leaseholders may get round restrictions in their lease to achieve residential use which brings the potential right to forcibly acquire the freehold (enfranchisement).