According to research from the Strutt & Parker/IPD Lease Events Review (LER) the proportion of retail industrial tenants entering liquidation or receivership has fallen below 1% in 2007.

The LER is based on over 40,000 tenancy records and provides evidence on the frequency with which different events interrupt cash flow in commercial real estate. Along with the retail industrial sector there was also good news for the office sector with the LER finding that liquidation and receivership continued to remain under 1% for the sixth year in a row.

There was less good news to report when the LER came to look at those tenants wishing to exercise the break clause in their lease. The study found that there was a 6% increase in 2007 with 43% of tenants exercising a break, which is the highest in the LER’s 10 year history. For those tenants who have reached the end of their lease there was also a fall in those renewing, in 2007 only 17% of tenancies were renewed.

Andy Martin, head of Strutt & Parker’s commercial division, said: “These headline figures will need greater examination to ascertain the course of these renewal figures. Some of which, for instance, will reflect an owner’s decision to take properties back for refurbishment/redevelopment.”