For a business, the office or warehouse is often its largest fixed cost. When a landlord proposes a significant rent increase, it can threaten the very viability of the company. In Dubai, commercial rent increases are not arbitrary; they are regulated to ensure market stability.
The 90-Day Rule and RERA Index
The most critical protection for commercial tenants is the 90-day notice period. Any amendment to a lease agreement—including a rent hike—must be communicated in writing at least 90 days before the contract expires. If your landlord notifies you only 30 days before renewal, the increase is legally invalid, and the lease should technically renew under the same terms.
Furthermore, the RERA Rental Price Index acts as the benchmark. If your current rent is within 10% of the average market rate for similar properties in that area, the landlord is not permitted to increase the rent at all.
Negotiating Commercial Terms
Unlike residential properties, commercial leases often involve “Fit-out periods” and specific “Use Clauses.” When a landlord seeks an increase, businesses should evaluate:
- The Valuation Certificate: If the landlord claims the RERA index is outdated, they must obtain a formal Rent Valuation Certificate from the Dubai Land Department.
- Operating Costs: Are service charges included? If the rent goes up, ensure the landlord’s maintenance obligations are also being met.
How DY Legal Consultants Will Help
Commercial leases are significantly more complex than residential ones, often containing “Ratchet Clauses” or specific indexation formulas.
DY Legal Consultants protects your bottom line by:
- Lease Auditing: We review your current contract to identify if the proposed increase violates the RERA cap or the 90-day notification window.
- Market Benchmarking: We assist in obtaining official valuation certificates to counter unreasonable landlord demands.
Dispute Mediation: We represent your business in front of the RDC, arguing your case to maintain a fair market rent and ensuring your business operations are not disrupted by unfair overhead increases.
