Small businesses are increasingly signing shorter lease deals to dodge rent reviews, an independent analysis suggests.

Average lease lengths fell by more than ten months to just five years in 2010, according to the BPF/IPD Annual Lease Review of 91,000 tenancies.

The review shows that 81 per cent of leases are signed for five years or fewer and therefore unlikely to face a rent review.

By comparison, just over 3 per cent of small businesses have a lease of over ten years.

Liz Peace, chief executive of the British Property Federation, says: ‘For small businesses, shorter leases are probably a good thing, with the pace of business change so fast these days it makes little sense for most small and medium sized businesses (SMEs) to tie themselves into the obligations of a long lease.’

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