The Government’s recent announcement that it plans to ban upward only rent reviews as part of the Devolution Bill may appear, at face value, to support tenants. But – and it’s a big but – the unintended consequences of this move could be deeply damaging, particularly for cities like Birmingham.

Upward only rent reviews are a long-established and widely accepted part of UK commercial property leases. They give landlords and investors the income certainty they need to fund development projects, invest in regeneration and, crucially, keep cities competitive.

Birmingham is a prime example of how long-term investor confidence can reshape a city. Just look at the £1.2bn Paradise scheme, which has attracted a wide mix of occupiers, from PwC to high-quality leisure and hospitality brands, by offering best-in-class space in the heart of the city. Developments like this don’t happen without strong institutional backing, and that backing depends on stable, predictable rental income.

If upward only rent reviews are banned, we risk disrupting the business model that underpins such investment. That could mean fewer cranes on Birmingham’s skyline in the years to come.

Look at Northern Ireland, for example, where upward only rent reviews were banned in 2010 under the Business Tenancies (NI) Order 1996 (Amendment) Act. The intention was to create a fairer deal for tenants struggling after the financial crisis. However, the policy led to a marked decline in investment into the Northern Irish commercial property market. Investors, unable to forecast long-term returns with certainty, redirected capital to other UK regions where rental growth was more secure.

Even today, Northern Ireland struggles to attract the same level of institutional investment as cities like Birmingham, Manchester or Leeds. The policy had the opposite of its intended effect: rather than increasing vibrancy and opportunity for local businesses, it dampened development and restricted access to quality space for occupiers.

At Innes England, we work with both landlords and tenants. We’ve seen first-hand how commercial viability rests on long-term lease structures that give clarity to both sides. Upward only reviews are often balanced with incentives – rent-free periods, stepped rents, capital contributions – that help tenants move in, expand, and thrive.

Take the Knowledge Quarter near Aston University. Much of its success has come from private-sector investment into office and R&D space, driven by confidence in long-term asset performance. A policy shift that undermines income security could see that investment dry up just when Birmingham needs it most.

And let’s not forget the wider ripple effects. Pension funds are some of the largest investors in commercial property. If rental income becomes unpredictable, they may redirect capital elsewhere, away from Birmingham and away from UK cities altogether.

None of this is to say that tenants don’t deserve fairness and flexibility. They absolutely do. But that needs to come through open negotiation, not one-size-fits-all legislation. In practice, commercial leases are far more collaborative than they were 20 years ago. Landlords are already offering shorter, more flexible terms to attract occupiers, and that trend is likely to continue.

We should be supporting that evolution, not destabilising the framework that allows investment to flow into our cities.

If the Government is serious about empowering regions, it must engage directly with those of us on the ground. Birmingham’s business and property communities have worked tirelessly to build momentum in the wake of the Commonwealth Games, the promise (and eventual arrival) of HS2, and post-Covid recovery. We can’t afford a policy that puts that progress at risk.

Before taking a legislative sledgehammer to a tool that supports long-term development, the Government should stop and listen. Because if we want Birmingham to keep growing, we need policies that encourage investment, not ones that drive it away.