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A leasehold agreement or lease is usually a longer-term contractual arrangement, anything between 10-25 years. You commit to paying the landlord rent for this whole period and normally the amount of rent you pay will also be reviewed every 3-5 years. Leases are generally protected by the Landlord & Tenant Act meaning that you can renew when the term finishes but again it is important to check and make sure this is the case.

In a lease arrangement, the property owner or landlord will usually take more of a back seat and leave you to run the business providing you pay the rent on time. There are significantly more responsibilities under a lease for example ALL repairs and maintenance of the pub building including insurance, so you have more of the risk and costs compared to a tenancy agreement.

Whilst you can’t normally serve notice during a lease, you can usually, if you wish, sell the business to a new owner after a qualifying period, known as an assignment. The lease will normally contain the terms and conditions which need to be complied with in order to assign to someone else. With a lease, you are usually able to sell the ‘goodwill’ in the business, which means if your business is successful, and you have built it up you can potentially sell it for a premium.

Leases tend to suit experienced business owners looking for a long-term commitment where they can be rewarded for their hard work when they choose to end their agreement if they have a successful business to hand over.