Propertymark Level 3 Commercial Property Agency key terms

The transfer of a tenant's remaining leasehold interest to a new occupier, who then takes on the lease obligations. Usually requires the landlord's consent and is distinct from subletting.

The collective term for ways a tenant may transfer or share rights to occupy leased premises, such as assignment, subletting or charging. Leases commonly restrict alienation without landlord consent.

The grant by a tenant of a lesser lease of part or all of the premises to another party. The original tenant keeps its own lease and remains liable to the landlord.

The superior lease held from the freeholder or ground landlord, under which any subleases sit. The head lessee's obligations flow down to subtenants.

Outright ownership of land and buildings for an indefinite period, subject to law and any rights affecting the title. The owner, or freeholder, holds the superior interest.

A time-limited right to occupy and use property, granted by a lease and subject to its covenants and rent. It can be bought and sold during its term.

A contract granting exclusive possession of property for a fixed or periodic term, usually in return for rent. It binds both landlord and tenant to stated covenants.

Personal permission to use premises without exclusive possession. It falls short of a lease, is generally easier to end and does not create a transferable interest.

The right to control premises and exclude others, including the owner, from them. Its presence is a key indicator that an arrangement is a lease rather than a licence.

A flexible occupation with no fixed term that either party may end at any time. It creates no protected interest and is often used during negotiations or short-term arrangements.

A lease provision letting the landlord or tenant end the lease early on a specified date, usually after giving notice and meeting stated conditions.

A clause setting out when and how rent is reassessed during a lease, often at fixed intervals. It may be upward-only, open market or index-linked.

A sum paid by a tenant to the landlord as security against default, refundable on performance of obligations. Commercial deposits are not held under tenancy deposit protection rules.

A person or company promising to meet a tenant's obligations if the tenant fails. Guarantees are often required where the tenant's financial strength is limited.

A promise in a lease or contract to do, or not do, something. Common examples include paying rent, repairing the premises or using them only for stated purposes.

A lease term restricting the purposes for which the premises may be used. Changing the permitted use usually requires landlord consent and may need planning permission.

The duty in a lease setting out who must maintain and repair the premises and to what standard. It may be full repairing, internal only or limited by a schedule of condition.

A record of the property's state at the start of a lease, often with photographs. It can limit a tenant's repairing liability to the condition shown.

The repairs, reinstatement and related works a tenant owes under a lease at its end, or a claim for the cost of them. Often assessed against a terminal schedule.

Restoring premises to a specified condition, such as removing alterations or fitting out changes at lease end. It may also mean rebuilding after damage under an insurance obligation.

Physical changes made to leased premises, such as structural works or fitting out. Leases usually require landlord consent, and some changes are prohibited outright.

A payment by occupiers towards the cost of maintaining and insuring shared parts of a building or estate. It is usually estimated in advance and reconciled against actual costs.

Money collected through a service charge and set aside for future major works, such as roof replacement. It spreads large costs across the years benefiting from them.

Areas of a building or estate shared by occupiers, such as corridors, lifts and car parks. Their upkeep is typically funded through the service charge.

A sum a tenant pays towards the landlord's cost of insuring the building, recoverable under the lease. It is separate from the service charge.

Delivery of premises free of occupiers and their belongings, so the buyer or new tenant can take immediate control. It is often a condition of sale or lease completion.

The point at which buyer and seller become legally bound to a property transaction. Completion usually follows later, on a date fixed at exchange.

The final stage of a property transaction, when the price is paid, the transfer is effected and the buyer or tenant takes possession.

The investigations a buyer or tenant makes before committing, covering title, planning, environmental and building matters. It informs the decision to proceed and the price offered.

The legal right to own or hold an interest in property, evidenced by deeds or registered entries. Investigating title reveals rights, restrictions and encumbrances.

A right, restriction or charge affecting property that limits its use or transfer, such as an easement, covenant or mortgage. It should be identified in title investigations.

A right benefiting one piece of land over another, such as a right of way or for services to pass. It usually runs with the land and binds successive owners.

Formal consent from the local planning authority for a proposed development or change of use. Working without it, where required, can lead to enforcement action.

Moving premises or land from one planning use class to another, which may require planning permission. It is separate from any lease restriction on use.

An inspection of a property's condition and structure, commissioned by a buyer or tenant. It identifies defects and helps inform price, lease terms and repair liability.

The annual rental income from a property expressed as a percentage of its capital value or price. It is a core measure for comparing investment returns.

The open market worth of a property interest, usually expressed as a lump sum rather than a rent. It reflects income, condition, location and market conditions.

The periodic payment made by a tenant to a landlord for occupation of premises, as set out in the lease. It may be reviewed or adjusted under the lease terms.

An opinion of the value of a property interest at a stated date, prepared on a defined basis. It underpins lending, investment and transaction decisions.

The written description and images used to advertise a property, including its size, use and terms. They must be accurate and not misleading.

A false or misleading statement of fact that induces another party to enter a contract. It can give the affected party remedies, including damages or rescission.

The method used to calculate the floor area of commercial premises, stated in square metres or feet. Consistent bases allow occupiers and investors to compare space fairly.

An assessment of a prospective tenant's financial standing, including payment history and accounts. It supports decisions on rent, deposits and guarantees.

Funds held by an agent on behalf of a client, such as rents or deposits. It must be kept separately from the agent's own money, usually in a designated client account.

The written agreement setting out an agent's services, fees and responsibilities. It should be provided to the client before work begins.

The fee an agent earns for completing a transaction, usually calculated as a percentage of rent or price. The basis should be clear in the terms of business.