What Landlords Should Know Before Refusing Renewal of a French Leaseback "Bail Commercial"
Published on :
15/11/2025
15
November
Nov
11
2025
In leaseback résidences de tourisme, owners lease their property to a management company under a commercial lease.
As the 9-year term approaches, many landlords consider refusing renewal—often due to low rent, poor maintenance, or a desire to regain control of the property.
Before doing so, it is essential to understand the legal framework and the practical risks.
1. NON-RENEWAL AUTOMATICALLY TRIGGERS THE QUESTION OF EVICTION PENALTY
Under the French Commercial Code, the operator has a statutory right to renew the lease. If the landlord refuses, an eviction penalty (indemnité d’éviction) may be due, unless the operator is in serious breach of its obligations. This penalty compensates the operator for the impact on its business.
2. NON-RENEWAL IS A COMPLEX LEGAL PROCESS
Non-renewal is not a simple letter. It requires:
- a strictly drafted non-renewal notice (“congé”),
- served by a huissier within mandatory deadlines.
3. MANAGEMENT COMPANIES OFTEN OVERSTATE EVICTION PENALTY CLAIMS
Operators frequently pressure landlords by asserting that non-renewal will result in very high compensation. In practice, even when an eviction penalty is owed, the amounts finally paid are usually far lower than the operator’s initial claims.
4. NON-RENEWAL CAN STILL BE A VIABLE AND STRATEGIC CHOICE
Even considering the potential cost of an eviction penalty, non-renewal may be justified when: the management company performs poorly ; rent payments are irregular ;the owner wants to recover personal use of the property,
5. BEFORE NON-RENEWAL, LANDLORDS SHOULD SEEK LEGAL ADVICE
Before refusing renewal, landlords should:
- assess possible operator breaches,
- evaluate realistic exposure to compensation,
- and plan a negotiation strategy.
For more information contact us
History
-
How French divorce handles financial compensation and division of matrimonial assets
Published on : 15/11/2025 15 November Nov 11 2025Firm newsFirm news / INTERNATIONAL FAMILY LAW IN FRANCE
How French divorce handles financial compensation “prestation compensatoire" and division of matrimonial assets, including real estate and bank accounts located abroad. Divor... -
What Landlords Should Know Before Refusing Renewal of a French Leaseback "Bail Commercial"
Published on : 15/11/2025 15 November Nov 11 2025Firm newsFirm news / INTERNATIONAL REAL PROPERTY DISPUTES IN FRANCE
In leaseback résidences de tourisme, owners lease their property to a management company under a commercial lease. As the 9-year term approaches, many landlords consider refu...
-
Can You Adopt Your Partner’s Child in France? Adoption in France explained by an English-speaking family lawyer.
Published on : 06/10/2025 06 October Oct 10 2025Firm newsFirm news / INTERNATIONAL FAMILY LAW IN FRANCE
Blended families are more common than ever, and many stepparents develop strong, loving bonds with their partner’s child. At a certain point, some may consider legal adoption to... -
What Are Developers' Obligations When Property Delivery Is Delayed?
Published on : 02/09/2025 02 September Sep 09 2025Firm newsFirm news / INTERNATIONAL REAL PROPERTY DISPUTES IN FRANCE
In the world of new-build real estate, timely delivery of a property is not just a matter of convenience—it marks the completion of the buyer’s investment. When buying off-plan... -
Can a Child’s Stability Abroad Prevent Their Return After International Child Abduction to France? A French Supreme Court Decision Says No.
Published on : 02/09/2025 02 September Sep 09 2025Firm newsFirm news / INTERNATIONAL FAMILY LAW IN FRANCE
In a recent ruling, the French Court de Cassation—France’s highest civil court—reaffirmed that a child wrongfully retained in another country must be returned under the Hague...
