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Should a company shareholder/director guarantee the rental?

Posted in: Commercial Property

In many circumstances a Landlord will require a guarantee from the shareholders of a company Tenant. In what circumstances can a Tenant negotiate a lease without providing such guarantees or is it possible to have the guarantee limited to, say, three months' rental? Does the guarantee continue even if the lease is assigned to a third party or if the lease is renewed by a future tenant? When is a guarantee likely to be held to be invalid? These are important issues which require negotiation and we can help with advice on what is currently acceptable in the marketplace.

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