Assuming no referral is made in relation to the proposed terms, following the expiry of the 14 day period – the terms are now in an agreed form, and the negotiation period is ongoing. If a referral is lodged, the negotiation period is effectively on hold pending the conclusion of this referral.
The negotiation period is defined as 56 days from the receipt of the MRO offer.
During this phase the TPT is able to discuss the proposal with the POB. Bear in mind the MRO offer is proposed in addition to the already proposed tied offer in most cases, so generally both can be discussed alongside one another – keeping all options open.
To date most of the MRO rental offers received that we’ve analysed have proposed MRO rentals above our own valuation. We advise seeking professional advice regarding an independent rental valuation – once again something with which we can assist.
Generally this will result in a counter-proposal to the POB to facilitate discussions. It’s vital to ensure that you understand the market rental of your pub, as the review cycle will likely be for a period of 5 years – so there’s a great deal riding on the outcome.
If something can be agreed during this part of the process, the MRO process will come to an end. If the parties are unable to agree, the next step is to refer the MRO rental to an Independent Assessor (IA). This can be done at any time from 28 days following receipt of the offer, up until 7 following from the expiry of the negotiation period. If no referral is made within this time frame – assuming no agreement is reached, the MRO offer will lapse.
<-LEASE TERMS REVIEW | INDEPENDENT ASSESSOR (IA) ->