Understanding Section 25 Notices

December 7, 2025

Landlord Initiating Lease Renewal

For commercial landlords and tenants, the end of a lease term can bring uncertainty. The Landlord and Tenant Act 1954 provides a structured framework for certain lease renewals, and the Section 25 Notice is often a critical component of this process. Understanding what this notice is, when it is used, and the steps involved is essential for both parties to protect their interests.

This guide explains the purpose of a Section 25 Notice where a landlord is initiating the renewal of a tenancy in England and Wales, outlining the key procedures, deadlines, and potential outcomes. Whether you are a landlord seeking to manage your property assets or a business tenant aiming to secure your premises, our team is here not only to advise you but also to understand your needs and provide support, helping you navigate the process with greater confidence. As experienced landlord and tenant solicitors in Gloucester, Cheltenham, and Stroud, we are here to provide the expert guidance you need.

What is a Section 25 Notice?

A Section 25 Notice is a formal notification served by a landlord on a tenant to end a commercial lease. The notice is governed by Part II of the Landlord and Tenant Act 1954. This legislation grants business tenants “security of tenure” with statutory rights to remain in occupation and renew their lease upon expiration of the fixed contractual term.

The Section 25 Notice is the landlord’s tool to terminate the existing tenancy formally and either propose terms for a new lease or state the grounds on which they oppose a renewal. This makes it a pivotal document in commercial property dealings.

When is a Section 25 Notice Used?

A landlord uses a Section 25 Notice when a protected commercial lease is at or approaching the end of its contractual term. It then serves two primary functions:

1. To Propose a New Tenancy: Often, a landlord is willing to offer the grant of a new lease but may wish to update the terms, such as increasing the rent to the current market rate. The notice will terminate the old lease and set out the landlord’s proposed terms for the new one.
2. To Oppose a Lease Renewal: In other circumstances, a landlord may not want to grant a new lease. The 1954 Act specifies limited grounds on which a landlord can oppose renewal, such as redevelopment of the property or its occupation for the landlord’s own purposes. If this is the case, the notice must clearly state the statutory grounds for opposition. We will explore landlords’ opposition to lease renewals in a separate article.

It is crucial to note that this process applies only to tenancies with security of tenure. Leases that have been “contracted out” of the 1954 Act do not have this protection, and the tenancy will end automatically at the expiry of the contractual term with no automatic right for the tenant to renew or continue to occupy the property.

Serving a Section 25 Notice

Serving the notice correctly is a strict legal requirement. Any errors can invalidate the notice, resulting in significant delays and potential financial losses.

Who is responsible for serving the notice?

To ensure the process is valid from the outset, the notice must be served on the tenant by the party legally recognized as the “competent landlord.” Our team can advise you on who this is and ensure all legal formalities are properly observed, providing you with reassurance every step of the way. This is usually the immediate landlord, but in complex ownership structures, it’s vital to identify the correct party.

When should it be served?

Timing is critical. The notice must be served no more than 12 months and no less than 6 months before the termination date specified in the notice. This termination date cannot precede the contractual end date of the lease.

What must it contain?

The notice must be in the prescribed legal form for initiation of a renewal and contain specific information, including:

• Details of the competent landlord and the tenant;
• The address or a description of the property;
• The specified termination date for the existing lease;
• Confirmation that the landlord is not opposed to granting the tenant a new lease; and
• The landlord’s proposed terms for the new lease.

Negotiating Renewal Terms

If the landlord’s notice proposes a new tenancy, it opens a negotiation period with a view to the parties entering into a renewal lease before the termination date specified in the notice. The tenant does not have to accept the landlord’s proposed terms. Both parties can discuss and agree key elements like rent, lease duration, rent reviews and break clauses.

Both the landlord and tenant should seek professional advice from surveyors and solicitors during this stage. A surveyor can provide a valuation to determine the current market rent where this cannot be resolved between the parties. At the same time, a solicitor can advise on the legal implications of the proposed terms.

What Happens When a Section 25 Notice Expires?

The termination date specified in the notice may be extended by mutual agreement between the parties where negotiations are still ongoing but suppose the landlord and tenant cannot agree on all the terms for a new lease by the final deadline. In that case, either party must apply to the court before the notice expires to protect their position.

• The landlord can apply for a court order to terminate the existing tenancy and for a renewal lease to be granted on its proposed terms.
• The tenant can ask for a lease renewal to be ordered by the court on terms they consider fair and the landlord will be bound to grant the renewal lease to the tenant.

Once an application is made, the existing tenancy does not automatically end and continues under its current terms until three months after the court proceedings are concluded. The court has the authority to order the grant of a new tenancy and will settle any outstanding terms the parties could not agree on, such as the rent and term length. However, the tenant may ask the court to revoke this order if it does not wish to take a new lease on the terms ordered by the court and no longer wants to proceed with the renewal.

Deadlines and Time Limits

The deadlines associated with a Section 25 Notice are strict and absolute. The most critical deadline is the termination date specified in the notice. If no final agreement has been reached on the renewal terms and neither party has applied to the court by this date, the existing lease comes to an end and the tenant loses their statutory right to renew the lease.

This means the tenant’s security of tenure is lost, and they will be required to vacate the property. Missing this deadline can have significant consequences for a tenant and their business, so it is vital to monitor timelines carefully.

The Importance of Seeking Legal Advice

The procedures under the Landlord and Tenant Act 1954 are complex and full of potential pitfalls. Simple administrative errors, such as serving the notice incorrectly or missing a deadline, can have severe consequences.

Whether you are a landlord or a tenant, obtaining legal advice from experienced Landlord & Tenant solicitors at the outset is the most effective way to safeguard your interests. A solicitor can ensure all legal formalities are correctly followed, advise you during negotiations, and represent you in court proceedings if an agreement cannot be reached. For businesses in Gloucester, Cheltenham, Stroud, and the surrounding areas, Tayntons Solicitors offers the strategic legal support needed to navigate these challenges.

Your Strategic Legal Partner

Successfully managing the conclusion of a commercial lease demands thorough planning and specialised legal expertise.

A Section 25 Notice is a powerful legal instrument, and its correct handling is fundamental to achieving a successful outcome. By understanding the process and acting within the strict timeframes, both landlords and tenants can protect their commercial interests.

Suppose you are approaching the end of a commercial lease and need expert guidance. In that case, our team of commercial property solicitors is here to help. Tayntons Solicitors provides tailored commercial legal solutions to landlords and tenants across Gloucester, Cheltenham, Stroud and surrounding areas. Please speak with our team today to ensure your position is protected.

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