Knowing what to look for when entering into a lease, whether it be residential, retail or commercial, is sometimes confusing. To simplify we have outlined below the following things to consider.
Residential
- Tenants are required to give landlords 14 days’ notice to vacate prior to a fixed term expiry date
- Tenants are required to give landlords 21 days’ notice to vacate after a fixed term expiry date
- Tenants can give landlords 14 days’ notice to vacate during a fixed term expiry date if the landlord fails to notify intention to sell the property prior to entering into a lease.
- Landlords are required to give tenants 30 days’ notice to vacate prior to a fixed term expiry date
- Landlords are required to give tenants 90 days’notice to vacate after a fixed term expiry date
Retail
- Rent is charged per metre squared per annum and defined as Net Lettable Area
- As of 1 July 2017 there is no minimum term required for a retail lease
- The landlord cannot rescind an offer to lease upon the issue of a Lessors Disclosure statement, the tenant can (unless a lease is signed and given 7 days to cool off).
- If a Lessors Disclosure Statement has misleading information or is incomplete the tenant may terminate their lease within 6 months of commencement
- A landlord will typically consider a retailers former business success, financial stability, lease history and suitability to the existing tenancy mix prior to entering into a lease.
Commercial
- Rent is charged per metre squared per annum and defined as Net Lettable Area
- Various ways to charge the rent;
- Face Rent (advertised)
-
- Net Rent (Excluding building outgoings)
- Gross Rent (Including building outgoings)
- Effective Rent (Net of Incentives)
- Access is typically granted when a landlord receives;
- a signed lease
- 1 month’s rent in advance
- a bank guarantee
- a certificate of insurance
- A lease proposal (or Heads of Agreement) is a show of good faith and not a binding contract
- The tenant typically pays the Landlord’s and their own legal costs, except under RLA (Retail Leases Act)
Written by
James Maxwell
Senior Leasing Manager
james@roseandjones.com.au