We recently bought a property in Abu Dhabi which has an existing lease agreement. We were told by the developer that the lease was due to terminate in 2016, however, the tenant (a large company) is contesting this stating they have a clause for a further lease. We have tried to negotiate but they are being very aggressive. We wish to live in the property, that is why we bought it. The original lease was signed between the developer and the tenant in September 2012 for a term of four years. Now the tenant is sending us a lease agreement to sign as we are the new owners, but they are insisting on a further lease. The rent they insist on is half the market value and all of these terms are apparently per the clauses of the original agreement. Furthermore they have edited the new lease agreement but are insisting we have no rights to make any amendments. There is a clause at the end of the lease that states that any applicable law passed after the lease was signed will supersede any specific clauses. We cannot afford to pay a mortgage and rent a property to live in which means we will lose everything, our home, our money and our jobs. That is a terrifying prospect. KK, Abu Dhabi
My understanding is that the current tenant’s lease expires in September next year. For you to gain possession, you have to put your intentions in writing 60 days before the expiration of the lease. By buying a property with a resident tenant you will automatically take over the rental lease terms. Neither landlord or tenant can make any changes to the contract unless there is this 60-day notice and an agreement to these changes are in place. With reference to the rent, this is now up to the landlord as the Abu Dhabi government scrapped the 5 per cent rental cap nearly two years ago. Remember, though, that both parties have to give the 60 days’ notice to effect any change to the contract.
I am a tenant of a villa in Dubai. The landlord sent me a request for a rental increase two months before the expiry date and I refused it because the required notice of 90 days was not given. Now the landlord says I will have to vacate the apartment on expiry since I haven't communicated to him my wish to renew the contract with 90 days' notice. He goes on to claim that the contract says that "renewal of tenancy is at the discretion of the landlord". What kind of communication do I need to give him to renew the contract and what notice period? Is the clause in the contract legal and valid? MG, Dubai
The 90-day notice is there to effect any changes to the contract. This could mean the number of cheques, the rental amount or any other changes to the terms and conditions. If neither party gets in touch with the other, then the contract automatically renews under the same terms and conditions. Therefore it's fair to say that the onus is generally more on the landlord to communicate with his tenant during this 90-day window. Your landlord's demands that you must now vacate only because you did not communicate with him during this time is not valid. I do agree, however, that it is only good manners to inform the landlord that you wish to stay on and renew.
We have sent a 12-month eviction notice to our tenant twice and the tenant refuses to acknowledge it. Kindly advise what our course of action should be. HF, Dubai
Your best course of action would be to take out a classified advert in the newspaper, confirming the 12 months’ notice. Keep a copy of the advert and receipt of the registered notices sent. After the expiry of the 12 months, if your tenant has not vacated, you can file a case at the rental committee armed with the evidence that you did all you could to inform your tenant(s) of the notice. Please remember, however, that any 12-month notice to vacate has to be accompanied with a valid reason for eviction.
Mario Volpi is a real estate professional who has worked within the industry for the past 31 years in London and Dubai. The opinions expressed in this article are those of the author and they do not reflect in any way those of the institutions to which he is affiliated.
It does not constitute legal advice and is provided for information only. Please send any questions to mariovolpi64@gmail.com.
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