How to terminate the lease of a leaseback in a tourist residence

Notice: how to terminate a commercial lease

1 – Terminate the Lease: Sending the notice to the right people

When given by the lessor, the notice must be sent to the lessee, or to each of them if there are several. If the tenant decides to terminate, he or she must send the notice to the person having the status of lessor; if there are several lessors, the notice sent to one of them takes effect for all the others.

The involvement of a lawyer before this stage ensures that no irregularities are made. An irregular notice will force the owner-lessor to issue a new notice and once again respect the notice period stipulated in the commercial lease. In practice, the notice period specified in the commercial lease ranges from 6 to 12 months.

2 – Terminate the Lease: Sending notice at the right time

In principle, the tenant must send his notice at least six months before the expiry of each three-year period (i.e. at least six months before three years following the conclusion of the lease, then six years, then nine years). Both parties can send notice at the end of the contract, also giving at least six months’ notice.

However, in the case of a lease for a tourist residence, article L.145-7-1 of the French Commercial Code prohibits the tenant from giving notice at the end of a three-year period. In other words, when the operator of a the leaseback property (tourist residence) signs a contract with the lessor, he is committed for at least the first 9 years.

Where notice is given late, its effect is postponed until the last day of the following quarter. Example: the lease for the tourist residence was due to expire on 30/01/2019, and the tenant sent his notice on 15/11/2018; the notice will only take effect on June 31, the last day of the quarter.

If the notice is given too early, it will take effect on the expiry date of the lease or, if it is given during the course of the lease, on the expiry of the next three-year term.

3 – Taking care with the form and content of the notice

Notice of termination from the lessor

Articles L. 145-9 and L. 145-4 of the French Commercial Code require the lessor to deliver the notice to the lessee(s) by bailiff. The notice must contain the following elements :

• a clear and unambiguous notice to terminate the contract ;
• a statement that any tenant wishing to contest the notice must take the matter to court within two years of the date of notification;
• the reason why the lessor is giving notice.

The notice without eviction indemnity must refer to the serious and legitimate reasons already set out in a prior formal notice to the lessee (the operator of the leaseback or tourist residence).

Notice with eviction indemnity does not require a reasoned refusal to renew the commercial lease.

The specialized lawyer can supervise the bailiff’s work on behalf of the lessor to avoid drafting errors (e.g.: notice without eviction indemnity with an erroneous mention such as “sale”).

Notice of termination from the tenant

The operator of a tourist residence who gives notice of termination at the end of the contract (or during tacit extension) can only do so by bailiff’s writ. He is not required to explain the reason for his notice.

Do not hesitate to contact us to ask us your questions via the contact form at the bottom of the homepage.