Restaurants and Cafes - What to think about when finding new premises

Finding premises for a new or existing restaurant or café will normally involve taking over an existing Lease or entering into a new Lease of premises. The process can seem daunting for any business. However, the right legal advice and guidance should ease the burden and make the process considerably easier. Some of the key issues which you should consider are set out below.

1. Heads Of Terms

The Landlord and the prospective Tenant will usually be assisted by an Agent who will have produced Heads of Terms identifying the key points of the proposed Lease, such as the rent, the review period and the length of the term (ie how long the lease will run).

2. Break Clause

Along with the term of the Lease, a Tenant should consider whether the Landlord will grant a Break Clause in the Lease.  This will enable the Tenant to end the Tenancy before the end of the actual term of the Lease.  The solicitor acting for the Tenant should be able to negotiate a Break Clause.  For example, it might be agreed that a Tenant can end the lease after a period of 2 years of a 5 year Lease.

The Tenant should however note that they will usually only be able to exercise the Break Clause provided that all payments under the Lease in respect of rent, rates and service charges are up to date and in addition, that there has not been any breach of the Covenants in the Lease.

3. Rent Review

A Tenant can sometimes obtain the advantage of a rent free period at the start of a Lease.  Again, this is something which can be negotiated by the Tenant’s solicitor.  The rent free period would facilitate, for example, a fit out of the premises to the specification required by the Tenant.  This should be reflected in the Heads of Terms referred to in paragraph 1 above.

A Lease may also include a rent review.  The frequency of the rent review will depend on the length of the Lease.  It is important that the rent review clause sets out when each review will take place and the method of review.  A common rent review clause and one which would be to the advantage of a Tenant requires an assumption that the property is being let on the open market on a particular date, for a specified duration and subject to specific terms and conditions.  Following a rent review, the rent reserved by the Lease will be increased or perhaps decreased.

4. The Premises

The description of the premises will be set out in the Heads of Terms.  A Tenant should always check to make sure that the description of the premises in any legal document is accurate.  It is always best to have a map to identify the premises.  The description of the premises should clearly define the premises to be the subject of the Lease.

A Tenant should also check carefully the Covenants which will affect the premises during the course of the Lease, for example, the extent to which the Tenant will be responsible for interior and external repairs.  A Landlord might seek to impose a restriction on carrying out even the most minor improvements or alterations such as hammering in a nail or hanging a fixture on a wall.  A Tenant must be satisfied with the provisions in a Lease with regards to improvements and alterations.

5. Planning Permission

The Tenant should also be satisfied that the premises has the necessary Planning Permission for the use anticipated under the terms of the Lease.  If this is not the case, the Tenant will have to apply for Planning Permission.

6. Fire Safety Certificate

Under the Fire Safety (NI) Order 2010, it is the responsibility of the new Tenant to obtain a Fire Certificate in their name and in the name of the business.  Specialist companies can carry out the fire risk assessment and provide the Fire Safety Certificate for a fee of approximately £200.

7. Food Business

Under current legislation, all food businesses must be registered.  Registration in the Belfast area is with Belfast City Council.  All new businesses must register the premises at least 28 days prior to opening.  Helpful advice in relation to the process is provided by Belfast City Council website link:

8. Food Hygiene Rating System

The Food Hygiene Rating Act (Northern Ireland) 2016 came into operation on 7 October 2016 and is designed to help customers make an informed choice by providing information regarding the hygiene standards in takeaway premises amongst others food businesses.  Food businesses are now required to display a sticker with a food hygiene rating between 0-5.  It is the responsibility of the Tenant when taking over a Lease of premises to contact the Local Authority and arrange a food hygiene inspection.

9. Tupe Regulations

The TUPE Regulations protect the current employees' working rights when a new Tenant is taking over a business, or part of one.  A new Tenant taking on an existing business must keep on the existing employees unless the previous Tenant has made provisions for their current employees and there is an understanding that the existing employees will not be transferring with the business.


If you have any queries or would like to seek advice about any aspect of commercial leases, please contact Celine Clarkin at our Belfast office.

Please note that this article is for information only and specific advice should be sought from a solicitor before any action is taken.

Coffee Cup

Back to News Headlines