Common Mistakes Landlords Make with Commercial Property (and How to Avoid Them)

Introduction: Commercial Property is Profitable, If Managed Right

Commercial property remains one of the most rewarding forms of investment. With longer leases, higher rents, and stable tenants compared to residential, it’s no surprise that many landlords are diversifying into offices, retail units, and industrial spaces.

But the reality is this: the difference between success and struggle often comes down to avoiding common mistakes. Poorly structured leases, weak tenant vetting, or compliance oversights can erode income and damage asset value.

At Ravi Seth, we work with landlords to spot and fix these risks before they cause lasting harm. Here are the 7 most common mistakes landlords make in commercial property, and how you can avoid them.

Mistake 1: Weak Tenant Vetting

Securing “any tenant” just to end a void can feel tempting. But rushing tenant selection is the fastest way to end up with arrears or disputes.

Risks:

• Businesses with poor financial health collapse mid-lease.

• Start-ups without proper security default quickly.

• Arrears escalate, leaving landlords chasing unpaid rent through costly legal action.

How to avoid it:

• Conduct full credit checks and analyse company accounts.

• Request directors’ guarantees or rent deposits for start-ups.

• Use covenant strength assessments to understand risk.

💡 Case study: A retail unit landlord accepted a new tenant based on a friendly handshake. Within 6 months, arrears totalled £18,000. After engaging us, thorough vetting secured a national covenant tenant with stable income.

Mistake 2: Poorly Drafted Lease Agreements

A weak lease is a weak investment. Vague terms or missing clauses lead to confusion, disputes, and lost income.

Risks:

• Ambiguous repair responsibilities trigger disputes at dilapidations.

• Missing rent review clauses prevent income growth.

• Inadequate break clauses allow tenants to walk away too easily.

How to avoid it:

• Use experienced commercial property solicitors.

• Review every clause carefully: repairing obligations, alienation, rent reviews, and service charges.

Mistake 3: Ignoring Rent Reviews

Rent reviews are one of the most powerful tools to grow income and asset value. But too many landlords either forget them or handle them reactively.

Risks:

• Rental income lags behind market rates.

• Asset value declines at refinancing or sale.

• Lost opportunities compound over multiple review cycles.

How to avoid it:

• Diary all lease events at least 12 months in advance.

• Instruct a RICS surveyor for professional valuation evidence.

Mistake 4: Neglecting Compliance

Commercial property comes with stringent compliance obligations, and failing to meet them can invalidate insurance and lead to heavy fines.

Key compliance areas:

• EPC & MEES regulations (properties must meet minimum energy efficiency standards).

• Fire safety (alarms, risk assessments, escape routes).

• Electrical testing (EICR), gas safety, asbestos management.

• Equality Act accessibility requirements.

How to avoid it:

• Maintain a compliance calendar.

• Document inspections and certificates.

• Conduct annual compliance audits with a property manager.

💡 Tip: Buyers and lenders increasingly scrutinise compliance. Staying ahead protects not only income but also future resale value.

Mistake 5: Underestimating Maintenance Needs

Small issues ignored today become big costs tomorrow. Many landlords take a “reactive only” approach, leading to spiralling repair bills.

Risks:

• Roof leaks turning into structural damage.

• Neglected HVAC reducing tenant satisfaction.

• Poor maintenance reducing re-letting potential.

How to avoid it:

• Implement a planned preventive maintenance (PPM) schedule.

• Budget realistically for lifecycle works.

• Use trusted contractors for efficiency and reliability.

Mistake 6: Poor Communication with Tenants

Commercial tenants expect professionalism. Silence or delays frustrate occupiers and can trigger lease breaks or non-renewals.

Risks:

• Tenants feel undervalued and relocate.

• Small issues escalate into disputes.

• Renewals are harder to negotiate.

How to avoid it:

• Appoint a dedicated contact for tenant queries.

• Use clear SLAs (service-level agreements) for response times.

• Maintain regular landlord-tenant meetings for multi-let assets.

Mistake 7: Trying to Self-Manage Without Expertise

Many landlords try to save money by self-managing, but commercial property is complex. The cost of mistakes often outweighs management fees.

Risks:

• Missed rent reviews.

• Compliance breaches.

• Poor tenant retention.

• Legal disputes.

How to avoid it:

• Engage professional commercial property management.

• If self-managing, build strong processes for compliance, finance, and lease events.

• Seek expert advice before disputes arise.

Landlord Tips: Best Practices for Success

1. Always value tenant covenant strength over headline rent.

2. Diarise lease events (reviews, breaks, expiries) and act early.

3. Keep compliance documents organised and audit-ready.

4. Plan maintenance in advance to reduce reactive spend.

5. Communicate proactively — tenants who feel valued are more likely to stay.

Case Example: Avoiding a Costly Mistake

A Midlands landlord with three industrial units ignored a rent review in 2020. By 2023, market rents had risen by 12%, costing them over £50,000 in missed income. After instructing Ravi Seth, future lease events were diarised, arrears reduced, and compliance gaps closed.

Conclusion: Mistakes Are Expensive, But Avoidable

Commercial property can be a powerful wealth-building tool, but only if landlords avoid common pitfalls. From weak tenant vetting to neglected compliance, the same mistakes appear time and again — and they cost landlords thousands.

With expert support from Ravi Seth, you can stay ahead of risks, secure stable tenants, and maximise long-term returns.

Want to avoid costly mistakes in your commercial property portfolio? Contact Ravi Seth today for expert advice and tailored landlord support.