Commercial or Retail Leasing

Each year, many Australians lease commercial or retail properties.

Lease is a type of legally binding contract which defines the rights and obligations held by the property owner (landlord) and the person or entity (tenant) who is renting said property.

The Tenant acquires exclusive possession rights to the land in exchange for rent and other promises made to the Landlord.

Entering a Lease

Most people enter into commercial or retail leases buy wat of “Letter of Intent” which sets out the fundamental terms relating to: start date; period of lease; estimated floor area; names of landlord and tenant; annual rent; lease period; option period; read escalation mechanisms; and guarantee requirements.

The Letter of Intent is generally presented as an offer by the prospective tenant to accept the lease on the stated terms. When then countersigned by the prospective landlord, the terms in the letter of intent become the terms of the formal lease. However, the signed letter of intent is not the final document used as a legally binding lease because many terms and obligations can’t be included in a mere letter of intent.

Terms of a Lease

Though leases are not required to specify a precise floor area unless the lease is going to be registered, most leases will still specify an accurate floor area. Some rents will be determined by square metre, so exact property size may be of great importance to the lease.

Most leases last for a period of three or five years and once a lease is entered into, the tenant is required to pay rent for the entire term regardless of whether they use the property for the full term.

Commercial Leases

Commercial Lease generally relates to property which is used as a warehouse, industrial site, or an office building with no retail activity. Because no buying or selling to the public take place on commercial property, commercial leases are not covered by retail legislation. In a commercial lease, tenant liability is determined by their ability to negotiate when forming contract terms.

Retail Leases

Retail Lease, on the other hand, generally relates to property upon which goods are bought and sold to the public and is usually located in a shopping center. These properties are covered by state-based retail acts which differ across the country. Some states have area-based or time-based exceptions to the retail lease rules, which is why it is imperative to seek legal advice in your state of residence if you have any lease related questions.

Three Key Distinctions Between Retail & Commercial Leases

  1. Disclosures of Information: In most states, landlords are obligated by retail lease legislation to provide their tenants with a disclosure document seven days or more before the lease is entered into. If the landlord fails to properly disclose information, a tenant will have the right to terminate the lease even after it has been officially entered into.
    • Disclosure Documents summarize the terms of the lease, all costs payable under the lease, and any additional information about the shopping center in which the leased property is located.
  2. Unconscionable Conduct & Misleading or Deceptive Conduct: Retail lease legislation also provides tenants with additional protection from landlord misconduct.
  3. Lease Preparation Fees: In most states, a landlord in a retail lease is not permitted to charge their tenant for lease preparation or mortgagee consent expenses. In a commercial lease, however, landlords and tenants typically negotiate these fees.

Disputes or Breaches?

Regardless of whether you find yourself a landlord or a tenant, disputes can arise for a number of reasons. Though potentially stressful and costly, there are ways to minimize the damage but it requires both parties to have a working understanding of the terms of the lease. This means that you will be best served by seeking legal expertise right away. Many breaches or contract disputes can be settled with a lawyer’s assistance before ever going to court, though a lawyer will be able to defend your rights at trial if other methods of resolution fail.

biglaw strathpine

Happy Clients

At Big Law we’re dedicated to providing excellent legal help delivered in a manner that our clients understand.

Why Choose Big Law Lawyers, Strathpine?

At Big Law, our key priority is providing people and businesses of the Strathpine and surrounding areas with the very best quality legal help. Our diverse practice areas mean that we can take care of your issues from the most simple to the most complex. We like to say that we provide the quality of legal help that you may expect from a large Brisbane CBD law firm.

We’re conveniently located in Strathpine with ample parking.

No Hidden Legal Fees

At Big Law, you can be guaranteed that you’ll never received unexpected legal bills in the mail. We offer transparent legal pricing for all matters.

Top Quality Legal Help

At Big Law, quality legal help is our focus. You can expect from us, the very best legal advice in the matters we specialise.

Conveniently Located

No need to head to Brisbane CBD to get great legal help. We purposely established Big Law in Strathpine for your convenience.

Things to Read

Things to Consider When Buying a Small Business

There are a lot of compelling reasons to buy an established small business. Existing customers, trained staff, good will and immediate cashflow can all make the purchase of an operating small business a sound investment.

What Your Business Needs to Know About Insolvency & COVID-19

While Australia’s collective efforts to limit the spread of coronavirus mean the country is gradually reopening and retuning to normal, the effect of shutdowns and border closures on the economy will last for some considerable time yet.

What are the Implications of Different Entities When it comes to Purchasing Commercial Property

Investment in a commercial property is a big financial decision but one that in the right economic environment – and in the right location – can be lucrative.

What You Need to Know About SMSF (Self-Managed Super Funds)

In Part One of this series of three podcast, Big Law Partner, Sylvia Lopez and Resource Accounting Queensland Director, Craig Bruce discuss…

Podcasts to Listen to

What Assets Actually Fall into Your Estate Plan?

In this podcast, Estate Planning Solicitor, Elise Jaques explains what assets actually fall into your estate plan. Elise Jaques Solicitor Make an appointment

When Should You Update Your Will?

In this podcast, Estate Planning Solicitor, Elise Jaques explains when should you update your Will.

What is Probate and How Do You Apply for it?

In this podcast, Estate Planning Solicitor, Elise Jaques explains what is a Probate and how you can apply for it.

How to Get the Most Out of Your Estate Planning Appointment

In this podcast, Strathpine Estate Planning Lawyer, Mahendra Mohan discusses a very important document that your executor needs to know about.