Ending Your Lease: What Are the Consequences?

● 15 May 2025

Lease termination? A smart decision starts with clear insight

● 15 May 2025

We previously wrote about the opportunities a lease contract offers as the expiry date approaches. Landlords are often pleased when a tenant considers extending the lease and may offer incentives, such as a rent-free period. But what are your rights and obligations when you decide to end the lease? And what should you pay attention to when searching for a new office space to rent?

You Terminate the Lease

When you terminate the lease, the agreement ends on the expiry date. You are then required to vacate and hand back the property on time. Some companies choose to terminate the lease early as a precaution, to avoid missing the deadline.

Although this may seem strategic, it can work against you. You lose negotiation leverage and the landlord can immediately point you to the exit. Only terminate the lease when you are certain you want to leave.

It is wise to explore alternative locations well before the termination deadline. There is plenty of office space available, but finding the right space that meets your needs and fits your budget can take time. Rising rental prices increasingly play a role in this process. Rental costs can also increase significantly due to rent indexation, which is based on the Dutch Consumer Price Index (CPI)

The Landlord Terminates the Lease

If the landlord terminates the lease, the agreement also ends on the expiry date. However, by law you are entitled to a two-month eviction protection period. This means you are only required to vacate the property two months after the expiry date.

During this period you can submit a request to the subdistrict court to extend the term by up to one year, and then twice more for another year. Once you submit the request, you automatically remain protected until the judge issues a decision.
Keep in mind that eviction protection does not release you from paying rent or from the responsibility to actively search for a new location. This can be a valuable moment to review which office spaces are available and which options best match your future accommodation strategy.

It is also important to check whether the building complies with sustainability requirements. Since 1st of January 2023, office buildings larger than 100 square metres must have at least energy label C. If the building does not meet this requirement, this may have consequences not only for the landlord but also for you as the tenant. At the end of the lease, this can affect delivery obligations and may lead to additional costs for adjustments.

Case Law on Rent Indexation

In 2023, more clarity emerged regarding the application of rent indexation for commercial space. On 19th of June 2023, the preliminary relief judge of the District Court of The Hague ruled that a high indexation figure does not automatically justify amending the lease on the basis of unforeseen circumstances.
This underscores the importance of carefully analysing the indexation clauses in your contract before terminating the lease. A substantial increase in rent can significantly affect total housing costs and your financial planning.

Pro Forma Termination: Does It Exist?

No, a lease is either officially terminated or not. This must be done according to the formal requirements stated in the lease contract. A so-called pro forma termination, where you indicate that you are considering ending the lease, is not considered an official termination. This means the landlord can simply hold you to the agreement.

What If You Forget to Terminate the Lease?

If you fail to terminate the lease on time, the agreement is automatically renewed for a new lease term. This can cause problems if you were already planning to move to another office space.
In some situations, for example where both parties had drafted but not signed a termination document, discussions may arise about the intent behind the renewal.

Important Tips

To avoid unpleasant surprises, keep the following in mind:

Know when your lease expires and which notice period applies. Also check whether the landlord can terminate the lease themselves.
Start determining your future accommodation strategy six to twelve months in advance. Do you still have enough space? Does your current office meet your needs? Which alternatives are available?
Only terminate the lease if you are certain you want to leave or if it is truly necessary, for example to avoid automatic renewal.
Has the landlord terminated the lease? Make use of your eviction protection unless the lease legally expires without protection.
Pay close attention to the formal requirements for termination, such as the notice period and the correct method of submission, for example sending a registered letter to both the landlord and the property manager.
By taking the right steps in time and paying close attention to the office space available for rent, you can ensure a smooth relocation and avoid unnecessary costs or legal complications.

More Information

Are you considering terminating your lease? We would be happy to review all options with you, as you may want to weigh different scenarios. The choice is of course yours. Our priority is helping you make well-informed decisions. If you would like to know more about our process, you can read more here.

Erik Tijsma

Partner & Strategic Advisor

[email protected]

+31 (0)6 5155 5504

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