Tenants urged to think long-term on rent reviews

Tenant farmers are being urged to prepare before upcoming rent reviews due in February and March.

The NFU warns that tenants need to think about the long-term future before agreeing to any updated terms.

Succession is one key issue which requires careful planning but it is slurry storage which justifies most urgent attention for farmers in Nitrate Vunerable Zones.

Establishing exactly who is liable for improvements to farm infrastructure is key here, warns the Tenant Farmers’ Association.

“Livestock producers within NVZs need to have at least six month’s holding capacity for slurry and our initial research suggests that only 40%-50% currently meet that requirement,” said the TFA’s George Dunn.

“But tenants need to be aware who is liable for these upgrades.”

Agreements drawn up before 1995 generally require the landlord to provide, maintain and update fixed equipment, he advises. However Farm Business Tenancies set up after this date typically put the onus on the tenant.

Often there is a requirement within these agreements that the holding remains as a dairy/livestock holding. Consequently if the tenant is unable to comply with current legislation as a result of a lack of suitable infrastructure he may not be able to fulfil these conditions. This can then be used as a point of negotiation for rent reviews.

Another point to consider is the end date of tenancy agreements.

“Landlords generally have to give 12 month’s notice for a rent review,” explains Mr Dunn.

“However if it is in dispute it does not necessarily need to be settled by this date. The landlord must apply for arbitration and negotiations can continue right up until this point.”