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Commercial & Retail Lease Agreement  Commercial Lease Agreement

Commercial & Retail  Lease Agreement includes Lease (Commercial, General) which is a general commercial lease that can be adapted to most uses. Suitable for most general commercial properties.

Understanding a Commercial Lease. … A lease is a legally binding contract that gives you certain rights to a property for a set term. A commercial lease is used when leasing property used primarily for a business. You should never sign a lease without understanding all of its terms and conditions.

Commercial Lease & Retail Lease

Commercial Lease is the legal document which sets out the rights and responsibilities of both landlord and tenant of a commercial premises

There are two kinds of Commercial Leases:-

  • 1. Retail Commercial Lease:  wherever goods or services are being  sold to the public from the premises, and;
  • 2. Non-Retail Commercial Lease:  wherever the premises will not be used to sell goods or services to the public, but will still be used for business purposes (e.g. offices, warehouses).

Our Lease (Commercial, General) is 54 pages long and includes:-

  • Part 2      RENT AND OUTGOINGS\
  • Part 3      ABATEMENT
  • Part 5      USE OF PREMISES
  • Part 6      ASSIGNMENT
  • Part 8      Environmental Clauses
  • Part 11    OPTION TO RENEW
  • Part 14    ATTORNEY
  • Part 18    MISCELLANEOUS
  • Part 19    GUARANTORS
  • Part 20    BANK GUARANTEE
  • Part 23    TRUSTS

If this Commercial & Retail Lease Agreement is not what you are looking for please do not hesitate to contact us.


Important Changes to the Retail Leases Act

Author :  Eric Kalde

Answers to frequently asked questions Australian Government Website

What if the building is sold?

If the building is sold the obligations and rights under the lease generally transfer automatically to the new owner. There are a few personal rights that may need to be transferred (like security bonds) but this is usually dealt with in your lease.

By buying the building with notice of your lease (registration does this) the new owners generally become bound to you as though they were the original landlord. In some cases the landlord is bound in the same way even if they don’t have notice of your lease. Of course, it is always better if the new owner knows about the conditions in your lease. Most States and Territories allow leases to be registered by the Land Titles Office. This is one sure way of a new owner having notice of your lease. If your landlord won’t register the lease, in some States and Territories you can do it yourself. It is the most effective way to protect your interests.

Remember, depending on the term of your lease, it may be very important for your lease to be registered on the title to the land. See page 4 for more details.

What if the tenancy mix changes?

In most States/Territories your landlord is not required to protect you from competition or tell you about proposed tenancy mix changes unless you have a special written clause in your lease. This is why it is important to walk around and have a look at kiosks and tenancy mix before you sign the lease. If you are concerned and promises have been made, make sure that your lease includes these.

What if the landlord disrupts my business?

Retail landlords promise their tenants that they will have quiet possession of the retail space. Under your retail lease legislation you may be given additional rights if your landlord interrupts your business, for example, by creating disruption during refurbishment, putting up special displays on common property, or placing new temporary kiosks. Check your retail lease legislation.


Disruption of business by landlord

Adam’s shop is located within a shopping centre and has good visibility and good passing pedestrian traffic. The landlord allows for a small temporary kiosk selling lollies to open up out the front of the premises. The kiosk inhibits the visibility of Adam’s shop and has the effect of diverting pedestrian traffic around the front of the shop. Adam requests that the kiosk be moved or alternatively that he receive a reduction in rent whilst the kiosk is there. The lease does not say anything about this type of situation, however under the relevant retail legislation; Adam has rights to seek compensation from the landlord for a loss of quiet enjoyment of the premises. Adam would need to prove that his quiet enjoyment of the premises has been disrupted – this is likely to be difficult. It is not enough that the kiosk is affecting his business.

If there is a large space out the front of your premises that you rely on for good visibility of your shop, it will

be in your interest to ensure that the landlord does not do something within that space that negatively affects your shop. Although you normally can’t control who else leases shops within a centre, you may, within the lease document itself, be able to protect large open spaces from being filled with kiosks.

Can I mortgage my lease?

In some States/Territories you can mortgage your lease unless your lease says you cannot. Leases usually say you have to ask your landlord for permission. Your retail lease legislation may set out the steps you and the landlord have to follow when you want to mortgage, and what conditions the landlord can impose.

What if I want to sell my business or let someone else use part of my retail space?

This is often called ‘assignment’ or ‘subleasing’.

Leases usually say you have to ask your landlord for permission or consent if you want to assign or sublease your retail space (and you will usually have to pay the landlord’s costs for the landlord preparing a consent document that you, the new tenant and the landlord will sign). Your lease and the retail lease legislation may set out the steps you and the landlord have to follow, what conditions the landlord can impose and whether

or not you are released from future obligations under the lease after the sale of the business. If your retail lease legislation does not mention release then you are not released from your future obligations under the lease unless the landlord agrees to release you. Your guarantors may also remain liable unless you and they are fully released by agreement with your landlord. It is very important that you get expert advice on this.

What happens if I default under my retail lease?

Each lease can be quite different.

Your lease will tell you something about what happens in your situation. The law is complex so not many leases spell out in full either what is default or all of the consequences of default. It is very important that you get expert advice on what your lease says about default – particularly if you have been issued with a ‘breach notice’ by your landlord. Even a single default can have consequences years later (for example you may be liable for the legal costs of the landlord and future rent).

Most breaches are capable of being fixed, for example those like undertaking works without consent or not operating your business within the required hours.

If you are experiencing financial difficulties, it is important to talk to your landlord and try to come to some arrangement with your landlord before you go into default for non-payment of rent. Non-payment of rent or other monies under a lease is generally treated more seriously than other types of breaches.


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