Landlords need to undertake checks of the prospective Tenant and any guarantor to the lease. The checklist of issues to be covered in the Lease and Disclosure Statement when drafting Commercial Leases and Retail Leases in Victoria should include:
Permitted use is in compliance with the planning permits
Breaches – the rights of the Landlord in the event of the Tenant’s breach of the lease
Landlord’s existing structures, fixtures, plant and equipment in the premises to be noted in the lease.
air conditioning
plastered walls
cool room
shop front
floor coverage
sink
grease tap
sprinklers
hot water service
suspended ceilings
lighting
telephone
mechanical exhaust
water supply
painted walls
waste
electrical distribution load (3 phase)
electrical distribution load (single phase)
separate utility meter-gas
separate utility meter-water
separate utility meter-electricity
Rates & Outgoings are fully disclosed
Renovations – any limitations on renovations or maintenance work that can be carried out, including whether the Landlord’s prior consent is required
Reinstatement – the state of the premises at the completion of the lease, and any obligations on the Tenant for reinstatement of the premises
Sublease – whether the Tenant is permitted to sublease part or all of the premises
Rent Reviews & Rent Determination – lease negotiations of when, and in what circumstances, rent reviews should take place including if and how GST and CPI increases are to be incorporated
Rent-free Periods – are any rent-free periods to be included in the lease?
Obtaining full company searches to check who are the correct parties, including any Guarantors
Assignment of Lease – Under what circumstances are you prepared to allow the Tenant to Assign the Lease?
Options or further terms – what, if any, is the Landlord prepared to grant the Tenant?
Trading hours permitted by the Landlord
Security Deposit – what Bond or Bank Guarantee will be required?
Car spaces provided and required in accordance with the Council Planning Permit
Floor plan and tenancy mix – especially in shopping centres
First Right of Refusal – if the Landlord is prepared to give the first right of refusal to the
Tenant to purchase the property if the Landlord decides to sell the building.
We can assist Landlords with the above checks.
If you would like to speak to our Commercial Tenancy Law Specialist, Jack Cyngler, of CKL Lawyers, about your commercial landlord rights, please do not hesitate to ring directly on +61 3 9500 1722 or email [email protected]
