Blog
Lease vs Licence to Occupy: What’s Right for Your Food Business?
September 3, 2025
3
Minutes

Lease vs Licence to Occupy: What’s Right for Your Food Business?

What is a Licence to Occupy?

A licence to occupy is a legal agreement that gives you permission to use a space without granting full legal possession. It’s typically short-term, flexible, and easier to exit than a lease. With a licence, the property owner retains control and can usually access the premises.

‍

Common Features of a Licence to Occupy:

  • Short notice periods (Up to 12 months, sometimes just 1 month)
  • Shared or non-exclusive use of space
  • Easier to terminate
  • No security of tenure (you don’t have the right to stay when it ends)

Perfect For:

  • Early-stage food brands
  • Ghost kitchens or dark kitchens
  • Pop-up restaurants, residencies and test kitchens
  • Businesses looking for low-commitment commercial kitchen space‍

‍

At Oya, most of our spaces are offered on a licence basis, giving food businesses the agility they need to grow fast and adapt quickly.

What is a Lease?

A lease is a formal, legal agreement that gives you exclusive possession of a property for a set period, usually with longer commitments (1+ years). It often comes with more obligations, such as; maintenance, insurance, and business rates and can be harder to exit early.

Common Features of a Lease:

  • Fixed term (e.g. 3 or 5 years+)
  • Exclusive use of the premises
  • More negotiation involved
  • Often a premium is paid, seperate from the annual rent.

Best For:

  • Established food businesses
  • Businesses with strong financial backing
  • Brands looking for long-term premises
  • Customised or highly specific kitchen setups

Key Differences: Licence vs Lease at a Glance

Feature Licence to Occupy Lease
Legal Status Permission to use space Legal right of possession
Term Length Short-term (monthly/rolling) Longer-term (1+ years)
Flexibility High Low to Medium
Exclusivity Sometimes shared Usually exclusive
Termination Easy, short notice Often difficult, long notice
Suited For Startups, dark kitchens Long-term, established businesses

‍

Why Food Businesses Often Choose a Licence to Occupy

Food businesses, especially in today’s dynamic market, need agility. With delivery trends, pop-ups, and changing customer preferences, committing to a long-term lease can be a risky move.

That’s why many operators are choosing licences to occupy. They offer:

  • Lower upfront costs
  • Greater flexibility to scale up/down
  • Faster move-in timelines
  • Access to ready-to-use commercial kitchens

Whether you’re testing a new concept, scaling a delivery brand, or simply don’t want the hassle of managing a full lease, a licence offers a smart alternative.

What to Consider Before Deciding

When choosing between a lease or licence, think about:

  • Your business model – Are you delivery-first, seasonal, or long-term?
  • Your growth plans – Do you need space for the next 3 months or 3 years?
  • Your budget and resources – Can you take on the cost and full build/maintenance obligations?

‍

Need help deciding? Oya works with hundreds of food businesses to match them with the right space on the right terms. Speak to our team to explore your options. Contact us.

Flexibility or Certainty - What’s Right for You?

There’s no one-size-fits-all when it comes to choosing between a lease and a licence to occupy. If you’re a fast-growing food business seeking flexibility, a licence may be the perfect fit. If you’re more established and want long-term control, a lease could be the better route.

Whatever your needs, Oya is here to support your next step. We offer a range of high-quality, ready-to-go kitchen spaces across the UK, helping food businesses thrive with minimal friction.

Ready to Find Your Next Space?

Explore our listings → HERE

Or speak to our team to get matched with a space that fits your needs and budget.

‍