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Leasing FAQ’s

Does a commercial lease need to be registered?

Commercial Leases are usually registered on title by the equivalent of the land titles office in each state depending upon the term of the lease. The law does vary from state to state so we include easy to follow state specific registration instructions with each leasing kit.

I have several commercial properties; do I have to buy a document for each property?

Assuming the other properties are not retail shops then you can use the same template as often as you like. There is no need to pay for the same document again.

Can I edit the lease agreement to suit my own circumstances?

Of course, the agreement provides a complete foundation for your own lease. However, because it comes to you as a fully editable MS Word template you are free to edit the document by adding special requirements or deleting sections as you see fit. If you are unsure or have special requirements, our in-house lawyers will be happy to assist.

Why does it matter if my lease is a retail or commercial?

The Retail Leases Act in each state and territory sets out certain criteria that define a lease as commercial or retail. If your lease is a retail lease, then the tenants receive additional rights and protections. Conversely, landlords must meet certain obligations and if violated, may give the tenant the right to walk away from the lease or even seek compensation.

What is a Landlord’s disclosure statement

In short, it is a document that the Landlord must give to a potential tenant, usually about 7 days before entry into a retail lease. The document sets out the main points of the lease like a quick reference guide. It will include:-

  • The term of the lease and if there are any options to extend the term;
  • Who pays the outgoings and what are those costs (if any) are expected to be;
  • How much rent will you charge? How often will the tenant pay? How often it will be reviewed;
  • Fit out details and who is responsible for the costs.

You’ll find more information about disclosure statements here .

How do I know if my premises is a retail premises and not commercial?

The Retail Leases Act in your state or territory contains a very specific retail premises definition, however, as a general rule, if the premises:-

    • will be predominately used for the carrying on of a retail business; or
    • is involved in the sale or hire of goods, or the sale of services to the public; or
    • is located in a retail shopping centre;

then it will most likely come under the retail leases legislation.

My tenant wants to move in next week and sign the lease afterwards. Is there any reason we shouldn’t do this?

Don’t be tempted to give the tenant early possession until all Lease documents have been validly signed. A tenant obtains certain rights on taking possession, even if a formal Lease has not been signed, and this may cause potential problems down the track. These issues can be avoided by ensuring that negotiations are complete and the Lease documentation is in place before the tenant is allowed possession.

Can I include the options to renew in the lease document?

Yes, you can include options to extend the lease as you see fit. To take up an option, the lessee must notify the lessor in writing in accordance with the formal requirements set out in clause 9.

Can I include procedures to review the rent?

Yes, we provide a number of options depending upon whether you want to include a CPI increase, a set percentage increase each year or a market rent review. Simply choose the optional clause that suits your arrangement.

Do I need to say how the tenant can use the property?

A well worded permitted use definition allows you to maintain effective control over the premises and the way it will be used. If the permitted use clause is too broad, for example: “Any use permitted by law” or “industrial use”, then you may find yourself confronted with a use that you are not comfortable with. If the permitted use is too narrow, then the tenant may be placed in a disadvantageous business position and find it difficult to organically expand and grow their business. If the permitted use is specific and limited, the tenant will need to obtain your consent if it wishes to change or expand the permitted use. This gives the landlord control over what business activities are being conducted from the premises and how the premises are used.

What is the difference between a lease and a licence?

A licence is generally not as formal as a lease, and a licensee does not enjoy the same rights as a lessee. A lease grants the tenant a leasehold interest in the land a licence does not. See more .

Generally, a lease is created whenever one person gives another:-
•             the right of exclusive possession;
•             for a certain period being a certain term or if not certain, capable of being calculated;
•             with the intention to give the tenant an interest in the land rather than a personal privilege.

There are certain factors to consider when determining whether a licence has been created. The most important consideration is whether the right to possession is non-exclusive.

Non-exclusive possession of the premises points to a licence, whereas exclusive possession of a premises, or part of a premises, will usually be considered a lease.

Examples of licences

Following are some examples of where a licence may be appropriate:-