The Bank of England raised Bank Rate from 3.75% to 4% on 5 November 2026. It's the first increase since 2023, and the next decision is due on 17 December.
For most people, the headlines are about mortgages and savings. If your business is weighing up an office move or a refurbishment in the next year or two, it's worth a closer look.
No. Bank Rate doesn't set what you pay your landlord. Commercial rent is fixed by your lease and only changes at a rent review, which usually comes round every five years.
Most UK reviews go to open market rent or are linked to inflation through RPI or CPI, and many are upward-only. If your lease is inflation-linked, the reason for the rise matters more than the rise itself. The Bank acted because inflation is running higher than it wants.
Moving office means spending a large sum up front. You pay to fit out the new space and settle dilapidations on the old one. If that's funded by a loan or asset finance, it now costs more to borrow.
A refurbishment of your current space can be phased, floor by floor or zone by zone. Spending is spread over months and can often come from operating budgets rather than one large loan. The business also keeps running while the work happens.
Staying isn't automatically the right answer. A quarter of a percentage point is small on its own. It does tip the numbers a little further towards making better use of the space you already have.
Higher rates tend to put pressure on property values, which can make landlords keener to keep good tenants. If your lease event is coming up, you may have more room to negotiate than usual.
If you're staying, ask whether your landlord will contribute to a refurbishment as part of the renewal. If you're looking elsewhere, compare incentives like rent-free periods and capital contributions, not just the headline rent.
Either way, talk to your finance team and property adviser about how the new borrowing costs affect your plans before you commit.
Not directly. Your rent is set by your lease and only changes at a rent review.
It makes borrowing to pay for one more expensive. The cost of the work itself depends mostly on labour and materials, which were already rising.
It depends on your lease and how much you expect your business to grow. Higher borrowing costs favour options that spread spending, like a phased refurbishment. A well-negotiated move with strong landlord incentives can still make sense.
Thursday 17 December 2026.
Source: Bank of England raises Bank Rate to 4%, Sovereign Magazine, 6 November 2026.