Competition Is Not Enough: No Rent Revision Without Material Change in Market Conditions
Written by, Séphora Amsellem on October 25, 2018
In view of the fact that rents in tourist residences are often overestimated, operators frequently seek a judicial revision of the rent to align it with the actual rental value before the expiry of the lease. Such claims may only succeed where there is evidence of a material change in local market conditions.
The French Supreme Court ruled that the mere presence of competing tourist residences does not, in itself, constitute a material change in local market conditions. More specifically, the fact that competing operators succeeded in reducing the rents paid to co-owners, thereby enabling them to offer more competitive prices to tourists, was not considered sufficient to justify a judicial rent revision.