London Eye - Landlord wants to increase rent

[Poppy]

The landlord (South Bank Centre) renting out land for part of the London Eye structure wants to increase the rent, by reportedly 1500%.

Do you think they are cutting their nose off (or maybe their eye)?

Do you honestly think the SBC would prefer to have no tenant than accept a lower rent increase?

[Paul_f]

The answer is that it is not the precentage increase that is the crux but if it reflects a "market" rent. If others are paying a similar amount as that in the review then that will take precedence. The best guide is comparisons with adjacent property.

[daveyjp]

Without knowing the detail of the rent review clause it's a bit difficult to comment on whether it's a fair increase or not. It may be based on the amount of money taken by the London Eye operators. An MP has said its only a tiny bit of land - so what without this land the Eye wouldn't make the money it does!

[Tax Accountant]

I believe that the landlords, South Bank Centre, are owned by the government themselves. On the other hand, the tenant company is a private enterprise, I believe owned by British Airways, making a neat bundle ever since they started this business. This has obviously been helped by paying a low rent. Market value has obviously shot up along the River Thames bank area and if the lease allows an increase on a rent review date, why should this not be allowed? Is this not what a private investor would do? Percentages sometimes give misleading vibes.

Both parties would obviously take account of the impact the rent review would have on future profits and affordability, and, I am sure, come to a sensible compromise. At the moment, both parties are simply setting their stalls for bargaining positions.