BERMUDA Law and Practice Contributed by: E Scott Swainson, Katrina Dickson and Erik Gotfredsen, Wakefield Quin Limited
that any temporary arrangements do not exceed the term that might have been allowed without a licence. It is also important that a foreign inves - tor does not secure the ability to profit from an unlicensed activity, should the relevant licence to do business in Bermuda not be received. If in doubt, the Department of Immigration may be consulted and licences in principle are sought in some cases. 6.2 Types of Commercial Leases Commercial Leases There is no typical commercial lease. A landlord of a multi-unit building may have a preferred form. Standalone leases tend to vary according to the law firm drafting the lease. Condominium Leases These are often very similar in appearance, and will include a landlord covenant to ensure the same core terms are imposed in all future grants for the relevant estate. Residential Leases These tend to be prepared informally, by the landlord or their rental agent. 6.3 Regulation of Rents or Lease Terms Commercial and Residential Rents There are no limitations on the recovery of com - mercial rents, including due to the impact of a pandemic. The same can be said of residential premises, except those that are subject to rent control. Rent Control Where rent control applies, the rent cannot be increased above the “lawful rent” , except with the consent of the Rent Commissioner. There are limited circumstances where a tenant may agree an increase but they cannot be a new/incoming
tenant. Should a landlord charge in excess of a lawful rent, the tenant may recover the excess for a period not exceeding two years, and a land - lord may not recover possession whilst sums are owed. 6.4 Typical Terms of a Lease Typical Length Most commercial leases of new buildings (grade A space typically rented to international busi - ness enterprises and their service providers) are for terms of five, ten or 15 years. Such leases will often include contractual rights of renewal (contingent upon advance notice, strict compli - ance with covenants and a rent review). Other commercial leases tend to be for a minimum term of two years. Limitations on Length of Term Companies may rent property for business pur - poses for up to 50 years. They may also rent property to house employees for up to 21 years. Longer leases and leases for non-business uses require government approval. Non-Bermudian individuals require a licence to acquire land by lease for terms in excess of five years. Many condominium managers will only approve subleases that are for more than six months (to avoid vacation rentals) but do not exceed two years. Maintenance Many office and retail leases are granted on full repairing and insuring terms that allow the land - lord to recover all servicing costs in addition to the rent. Lower grade and older premises are more likely to specify an all-in rent.
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