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Index-linked commercial rent: what lies behind the figure
If your commercial rent is tied to the consumer price index (Verbraucherpreisindex, VPI), it does not rise (or fall) arbitrarily but according to a fixed calculation rule. The basis is a value-protection or index clause in your lease. In a commercial lease this clause is governed by the German Price Clause Act (Preisklauselgesetz, PrKG) – not by Section 557b BGB, which applies exclusively to residential space. The distinction matters: residential index-linked rent under Section 557b BGB follows its own, narrower rules; for commercial space, the requirements of the PrKG apply instead, and above all whatever your contract specifically agrees. 3,4
In principle, price clauses are prohibited in Germany (price clause prohibition, Section 1 PrKG) – with exceptions. For commercial leases, the exception for long-term contracts applies (Section 3 PrKG): an index clause is permissible, among other things, if the landlord waives their ordinary right of termination for at least ten years, the contract is concluded for at least ten years, or one party can extend the term to at least ten years. In addition, the clause must not unreasonably disadvantage either contracting party (Section 2 PrKG): a clause that provides only for increases but no reduction when prices fall is deemed unreasonable – the adjustment must in principle work in both directions. 4,5
Practical note for tenants
Even if a clause breaches the PrKG, it does not automatically become invalid from the outset. Under Section 8 PrKG it remains effective until a breach has been finally determined – and only then from that point on (ex nunc). Past payments therefore generally remain valid. 6
Which index applies – and how to read it
As a rule, the decisive index is the consumer price index for Germany (VPI) published by the Federal Statistical Office (Destatis). The VPI is published monthly; since the 2023 changeover, the base year 2020 = 100 applies. An index figure of, say, 125.0 therefore means: consumer prices are 25% above the average for the year 2020. 1
Important: check in the contract which index figure is precisely meant (which month serves as the starting value) and which base year the clause names. Older contracts sometimes refer to earlier base years (2015, 2010). You can find the current and historical figures updated daily at Destatis; do not rely on figures from secondary sources. 2
The formula
How to calculate
Percentage index change = (new index − old index) ÷ old index × 100. New rent = old rent × (new index ÷ old index). The "old index" is the figure at the starting point (start of the contract or last adjustment), the "new index" the figure at the current adjustment date. 1
Step-by-step worked example
The following index figures are illustrative example values – you read your real figures at Destatis. 2
| Item | Value (example) |
|---|---|
| Old net cold rent | €2,000.00 |
| Old index (last adjustment) | 116.5 |
| New index (today) | 125.0 |
| Index change in % | (125.0 − 116.5) ÷ 116.5 × 100 ≈ 7.30% |
| New net cold rent | €2,000 × (125.0 ÷ 116.5) ≈ €2,145.92 |
| Increase per month | ≈ €145.92 |
Example calculation with illustrative VPI values (base 2020 = 100).
- Check the index change: 125.0 − 116.5 = 8.5 points; that is 8.5 ÷ 116.5 = 7.30%.
- Check the threshold: many clauses only take effect from an adjustment threshold (e.g. "from a 5% index change"). 7.30% is above that – the adjustment can be triggered.
- New rent: €2,000 × 1.0730 = €2,145.92. 4
Full vs. partial adjustment, thresholds and timing
- Full adjustment: the rent changes by the entire percentage (in the example +7.30%).
- Partial adjustment: some clauses pass on only a portion, e.g. 80% → €145.92 × 0.80 = €116.74 increase.
- Adjustment threshold: only once the index has changed by the agreed percentage/point value may an adjustment be made.
- Timing & notification: check whether the adjustment takes effect automatically or only after written assertion (stating the old/new index figures and the calculation). 4
What you should specifically cross-check as a tenant
- Is the 10-year commitment (Section 3 PrKG) actually met?
- Does the clause work in both directions (reduction too)?
- Do the starting index and adjustment index match the contract?
- Was a threshold agreed – and has it been exceeded?
- Is the increase correctly announced and calculated? 2,4,5
An AI contract analysis such as Boomerent's reads exactly these parameters out of your contract and flags anomalies – before you accept a back payment.
Do you run a pharmacy? What the automated analysis of lease, index clauses and service charges delivers specifically for your sector is shown on lease & service charges for pharmacies.
This article is general information and does not replace individual legal advice.
Frequently asked questions
How often may the index-linked rent be adjusted?
In commercial leases this is governed primarily by your contract. Unlike residential index-linked rent (Section 557b BGB: unchanged for at least one year), there is no statutory annual period for commercial leases; contractual rules such as "once a year" or "when an index threshold is exceeded" are common. So check the specific clause.3
Which index applies?
As a rule, the consumer price index for Germany published by the Federal Statistical Office, currently with base year 2020 = 100. What matters, however, is the index named in the contract together with its base year – older contracts may refer to earlier base years.1,2
Must an index clause also allow rent decreases?
Yes – and it must be able to. Under Section 2 PrKG, a clause that permits only increases but no reductions when prices fall is unreasonable. So if the VPI falls, the rent can decrease under a correctly worded clause.5
Is my index clause automatically invalid if it is flawed?
No. Under Section 8 PrKG the clause remains effective until a breach has been finally determined – and only becomes invalid from that point on, not retroactively. So have any doubts checked early.6
Sources
- 1Consumer price index and inflation rate (base year 2020 = 100) — Federal Statistical Office (Destatis), accessed 2026-07-06
- 2Consumer price index overall (monthly index figures) — Federal Statistical Office (Destatis), accessed 2026-07-06
- 3Section 557b BGB – index-linked rent (residential) — Federal Ministry of Justice (gesetze-im-internet.de), accessed 2026-07-06
- 4Section 2 PrKG – exceptions to the price clause prohibition (including symmetry requirement) — Federal Ministry of Justice (gesetze-im-internet.de), accessed 2026-07-06
- 5Section 3 PrKG – long-term contracts (10-year requirements) — Federal Ministry of Justice (gesetze-im-internet.de), accessed 2026-07-06
- 6Section 8 PrKG – invalidity of the price clause (ex nunc from final determination) — Federal Ministry of Justice (gesetze-im-internet.de), accessed 2026-07-06
Co-founder, Boomerent
Co-founder of Boomerent, PhD (University of Tor Vergata, Rome) in artificial intelligence and machine learning. Over 10 years of experience in automation, AI and software, across business and research — at TH Wildau and as an AI consultant at adesso and Sixt; he has also founded startups such as notivo and markencheck.ai. At Boomerent he builds the AI that extracts and analyzes contracts, costs, and deadlines. Writes about what that analysis surfaces in real leases — service charges, clauses, and deadlines.