Transfer of the leased property: when the commercial premises change ownership

Transfer of the Leased Property: What Happens When a Commercial Premises Changes Ownership

A commercial lease agreement is often seen as a stable anchor. Yet buildings do sometimes change hands: a sale, donation, or other transfer of the leased property can raise questions for both tenant and landlord. Does the commercial lease continue to apply? Can the new owner evict the tenant, and if so, under which conditions? In this final contribution to our series on commercial leases, NOMA explains what the law provides when the leased property is transferred during the term of the lease, and how tenants and landlords can best prepare for this situation.

The Sale of the Property Does Not Automatically End the Commercial Lease

When the leased property is transferred, the new owner in principle steps into the rights and obligations of the original landlord. The commercial lease therefore remains in force, and the tenant may continue operating their business.

However, this protection is not absolute: whether the new owner can evict the tenant depends on the specific circumstances under which the commercial lease was concluded and performed.

Long-Term Commercial Leases: When Is the Tenant Protected?

In the case of long-term commercial leases, the tenant enjoys the strongest protection when the lease agreement has a fixed date, for example through registration, or when the tenant has effectively occupied the premises for at least six months.

If one of these conditions is met, the new owner cannot simply evict the tenant, and the commercial lease remains enforceable against the new owner.

Without a fixed date and without six months of effective use, the new owner may evict the tenant without conditions.

Eviction by the New Owner: Only Under Strict Conditions

Even where the tenant is protected, a new owner may in exceptional cases still proceed with eviction. This is only possible if all of the following conditions are met:

• the lease agreement expressly provides for eviction through an eviction clause;
• the new owner terminates the lease within three months of the transfer, with a notice period of at least one year;
• the new owner invokes a legitimate legal ground, such as personal use of the property or substantial renovation works.
• In many cases, the new owner is also required to pay the tenant an eviction indemnity equivalent to one to three years’ rent.

The Original Landlord Remains Bound

Even after the transfer of the property, the original landlord remains obliged to guarantee the tenant’s peaceful enjoyment of the leased premises. This means the landlord must ensure that the tenant does not lose their contractual protection as a result of the transfer.

In practice, this is achieved by explicitly informing the new owner of the existing commercial lease and contractually binding them to respect it, for example through a lease-respect clause included in the deed of transfer.

Short-Term Commercial Leases - For short-term commercial leases of up to one year — for example pop-up stores — a simplified regime applies. If the lease agreement is registered, the new owner cannot evict the tenant. Without registration, this protection does not apply.

NOMA, Your Legal Sparring Partner for Commercial Leases

The transfer of a leased property is not a marginal event, but a realistic scenario in the life cycle of a building. A well-drafted commercial lease agreement provides clarity when ownership changes and helps prevent unpleasant surprises.

Do you have questions about the consequences of a sale or transfer of leased property? Or would you like your commercial lease agreement drafted by experienced lawyers? NOMA provides in-depth advice so that you know exactly where you stand as a tenant or landlord. Get in touch.

On 5 March, NOMA is organising a live seminar on commercial leases in Bruges. Leave your details here and we will be happy to keep you informed.