Commercial Rent Increases and Value Securing in Lower Saxony

When renting commercial space such as offices, medical practices, or logistics halls in Lower Saxony, the primary legal framework is the German Civil Code (Bürgerliches Gesetzbuch - BGB), which became effective on 1 January 1900. Unlike residential leases, there is no legal automatism for landlords to raise the rent to a local level. There is neither a qualified commercial rent index (Gewerbemietspiegel) nor a legally anchored possibility of adjusting to market values, unless this was explicitly agreed upon in the lease agreement under the principle of freedom of contract (§ 311 BGB).

Legal DisclaimerThis guide provides general legal information. Lease laws can change. Always consult a licensed notary or lawyer in this region.

1. Index and Value-Securing Clauses (The Absolute Norm)

In order to avoid the real return of the commercial property being eaten up by inflation over a long-term lease (usually 10 years or more), almost all professional commercial landlords agree on a price adjustment clause (often called an index clause). This links the net commercial rent to the development of the Consumer Price Index (CPI), which is newly determined every month by the Federal Statistical Office (Destatis).

Strict Requirements Under the Price Clause Act

For such a sliding-scale clause to be legally valid at all, it must comply with the strict requirements of the Price Clause Act (Preisklauselgesetz - PrKG):

• Long-term Commitment: Index clauses are usually only permissible in commercial law if the landlord guarantees the tenant the use of the area for at least 10 years (fixed minimum rental period or a basic rental period plus extension options for the tenant, which total 10 years) as stipulated by § 3 PrKG.
• If this 10-year perspective is missing, the value preservation clause may be void!

Types of Clauses

• True Sliding Clause (Wertsicherungsklausel): The rent automatically increases (or decreases!) in exactly the same percentage ratio as the consumer price index rises, as soon as a certain threshold value (e.g., "5% change since the last adjustment") is reached. Only a declaratory letter to the tenant is required.
• Reservation of Performance Clause (Leistungsvorbehaltsklausel): Landlord and tenant oblige themselves to renegotiate if an index changes significantly. (Risk: If they cannot agree, the contract may be subject to judicial adjustment).

2. Stepped Rent (Staffelmiete)

An alternative in commercial tenancy law in Lower Saxony is the stepped rent. While residential stepped rents are governed by § 557a BGB, commercial stepped rents rely on the general principle of freedom of contract (§ 311 BGB) and must satisfy AGB control (§ 307 BGB) to ensure transparency. Here, exactly in Euro amounts, it is negotiated at the time of contract conclusion at which points in time the basic rent (Kaltmiete) changes.

• Advantage: Highest predictability, no dependence on the inflation rate.
• There is no limitation of the term in commercial law; the steps can also be agreed upon over a 15-year period.

3. The Turnover Rent (Umsatzmiete)

Particularly in Lower Saxony's retail sector (e.g., shops in pedestrian zones in Hanover, Braunschweig, or Lüneburg) as well as in gastronomy, a combination of basic rent and turnover rent is popular:

• The tenant pays a low monthly fixed rent ("minimum rent").
• In addition, the tenant transfers a fixed percentage of their net turnover, provided this exceeds the fixed rent.
• This requires precise audit rights for the landlord, governed by the contract and the principle of good faith (§ 242 BGB).

4. Modernization Surcharges

In residential law, § 559 BGB allows modernization surcharges. However, this legal possibility is completely missing in commercial tenancy law. Any modernization costs must be explicitly and transparently anchored in the lease agreement (Formularvertrag) or negotiated in individual cases.

5. Jurisdiction and Legal Action

For disputes regarding commercial rent increases in Lower Saxony:

• Amtsgericht (District Court): Jurisdiction for disputes with a value up to 5,000 EUR (§ 23 No. 1 GVG).
• Landgericht (Regional Court): Jurisdiction for disputes exceeding 5,000 EUR (§ 71 GVG). Unlike residential cases, there is no exclusive jurisdiction for the District Court.

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