L&T - Index Rent Reviews

Question 1

What is an RPI Index rent review?

Answer 1

• Rent increase based on the Retail Price Index is based on inflation
• And changes to the price of goods and service

Question 2

What is an RPI Index rent review process?

Answer 2

• Reviewed the lease to establish the RR calculation
• Identify the RR had a cap and collar
• Obtained the RPI figure from the office of national statistics
• Carried out my calculation for the missing years
• Sent report to my client
• Once approved sent my calculations to the tenant to ensure they agreed
• Once confirmed, I sent onto the solicitors to document
• Once the RR memo was signed, I completed my DI form to increased the rent on the system to allow me to raise the amended invoices and sent on to the tenant for payment

Question 3

What is a CPI rent review increase?

Answer 3

• Provides a set formula for how any increase (and occasionally decrease) is to be calculated.
• Fixed Increase

Question 4

Can you explain how you checked the provision in the lease for the RPI rent review?

Answer 4

I checked the provision in the lease for the RPI calculation by going through the lease agreement in depth, ensuring that the RPI index value used was current and checking that the calculation method mentioned in the lease was strictly adhered to.

Question 5

Was there a cap and collar during the RPI rent review?

Answer 5

Yes, the collar was no less than 3% and the cap no more than 4%.

Question 6

What is included in a rent review memorandum and what is it?

Answer 6

It legally records the amount of revised rent during a rent review. It includes tenant details, landlord details, the subject property, review date, the revised rent and signatures by both parties.