Answers · CPI vs fixed vs market rent reviews
What's the difference between CPI, fixed and market rent reviews?
Direct answer
A CPI review moves rent in line with the Consumer Price Index; a fixed (or fixed-percentage) review increases it by a set amount agreed at signing, regardless of markets or inflation; a market review resets rent to what the premises would command if leased today, based on comparable evidence. Each shifts risk differently between landlord and tenant.
Fixed reviews are the simplest to plan around — both parties know the exact rent for the whole term at signing, which suits tenants who value budgeting certainty over market alignment. CPI reviews aim to preserve the real value of rent by tracking inflation, so they can rise sharply in high-inflation years and barely move in low-inflation ones — more variable than fixed, but tied to a transparent public index rather than negotiation.
Market reviews are the least predictable but the most accurate reflection of true value: rent is reassessed against comparable lettings, so it can move up or down with the market (subject to any ratchet clause preventing a fall). They're common at longer intervals — often every three to five years, or at the start of an option period — rather than annually.
Many leases blend the three: annual fixed or CPI increases between periodic market reviews, giving predictability in most years with a periodic reset to keep rent broadly aligned to market. When comparing lease offers, look at the whole review structure over the term, not just the headline starting rent — the review mechanism often matters more to total cost than the opening figure.
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