Extending your Lease outside of the 1993 Act
Obviously it is always open to landlords and their leaseholders to negotiate privately without the need for going through the process prescribed by the legislation. This is more likely to be a ‘quick fix’ in that professional landlords will know they have the
upper hand whilst no Notice is served because they are not bound to reach any agreement that is not to their liking.
This affects the bargaining power of the leaseholder who is likely to be offered for example an increase back up to 99 years only at an increased ground rent. This allows the landlord to negotiate again on the basis of an enhanced calculation for loss of future yield and the premium he can charge is likely to be disproportionate to the number of years granted.
There may be value in this to leaseholders wanting to extend the lease term quickly prior to marketing the property for sale. However, as service of the Notice does not preclude parties from negotiating it is usually advantageous to leaseholders to serve Notice in any event.