Long-term commercial lease agreements may soon be terminable by landlords in order to obtain a higher rental return. In this blog, we discuss what this could mean for entrepreneurs and what they should pay attention to when entering into new contracts.
Anyone operating a shop, hospitality business or other company with a direct retail outlet rents under the regime for Section 290 business premises (Article 7:290 Dutch Civil Code). Examples include supermarkets, hair salons and cafés. Tenants of Section 290 business premises enjoy security of tenure: a landlord may only terminate the lease on the limited statutory grounds for termination (Article 7:296 DCC). These include, for example, urgent own use or, after the expiry of 10 years, if the landlord’s interests in termination outweigh those of the tenant (and any subtenant) in continuation of the lease.
However, the opinion of Advocate General Van Peursem of 24 October 2025 (ECLI:NL:PHR:2025:1141) may put that protection under pressure. The central question in this case is whether a landlord, after all fixed terms of the lease have expired and the lease has become one for an indefinite period, may terminate the agreement with the sole interest of achieving a higher rent. Although this case concerned a situation where the lease had become indefinite, it touches on the broader application of Article 7:296(3) DCC. That provision requires the court to carry out a balancing of interests also when termination is sought after an extension pursuant to Article 7:292(2) DCC. The outcome of this case may have major implications for tenants who have been operating at the same location for decades.
In 1989, the heirs of a private landlord entered into a lease with Ahold Delhaize for a supermarket location. The lease ran for thirty years (10 years + four extensions of 5 years), after which it continued on an indefinite basis from 2019 onwards. The landlords wanted to terminate the agreement in order to lease the premises to another supermarket willing to pay EUR 775,000 per year, compared to the current rent of approximately EUR 488,000 per year. Ahold refused, but did offer to have the rent determined through the statutory rent review mechanism of Article 7:303 DCC. The landlords rejected that option: they sought termination of the lease on the basis of the balancing of interests under Article 7:296(3) DCC, with the sole interest of achieving a higher return.
Both the Subdistrict Court and the Court of Appeal dismissed the landlords’ claim. In their view, the statutory system of rent protection does not allow a rent increase to be pursued via termination: Article 7:303 DCC is the designated route for that. A purely economic interest in obtaining a higher return does not outweigh Ahold’s interest in continuing its operations at the location.
In his opinion, Van Peursem takes a strikingly nuanced approach. He acknowledges that the statutory system was designed to exclude termination for the purpose of obtaining a higher rent. However, he considers that in exceptional situations—such as here, after more than thirty years and after the expiry of all fixed terms—termination should not be considered impossible in advance.
According to Van Peursem, the law does allow scope, in cases where leases have been “over-extended” beyond thirty years and are continuing for an indefinite period, to apply a balancing of interests in which the landlord’s interest in a higher return may play a role. He argues that it would be unreasonable for a landlord to remain fully bound by tenant protection even after more than thirty years, particularly where the market rent has risen substantially.
The Advocate General therefore concludes that the landlords’ complaints are well-founded: the Court of Appeal should not have dismissed the balancing of interests on the assumption that an interest in a higher rent can never be a legitimate factor. In his view, the Supreme Court should leave the door slightly ajar for this category of long-term leases.
The Advocate General’s opinion is not yet a judgment, but it does open the door to a more flexible application of the grounds for termination in the context of long-term leases. This may have far-reaching consequences for tenants. Rent protection is not immediately weakened, but in long-running leases (for an indefinite period) the court may attach greater weight to the landlord’s interest in freely disposing of the property and exploiting it more profitably.
For tenants of Section 290 business premises, this case is a wake-up call. In practice, it is both sensible and common to agree in the lease that termination on the basis of “urgent own use” or the balancing of interests under Article 7:296 DCC is excluded. This can prevent unpleasant surprises. We will be pleased to advise you on how best to incorporate such provisions into your lease agreement.
The Advocate General opts for a nuanced approach under which long-term leases may, in certain circumstances, still be terminated on the basis of the landlord’s interest in a higher return—but it is now up to the Supreme Court to take a final decision.
We will continue to monitor developments in this case. Once the Supreme Court has handed down its judgment and it becomes clear whether it follows the A-G’s opinion, we will publish a second blog in which we will set out the consequences for tenants and landlords in concrete terms.
Do you have questions about (the termination of) a commercial lease agreement or about entering into a new lease? We are happy to help. Please contact our Real Estate Team.
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