Commercial Lease

A commercial lease is a legally binding contract that governs the relationship, rights and obligations of both landlord and tenant to ensure a smooth process. However, before engaging into a commercial lease, it is highly recommend to seek legal advice to avoid unpleasant surprises or financial loses.

Our retail and commercial lease at Duffy and Simon ranges from small startups right through to well-established large scale businesses and enterprises. We understand that entering into commercial lease agreement is a big decision and can assist with setting up and reviewing any retail or commercial lease agreement.

  • Draft commercial lease agreement
  • Negotiate commercial lease
  • Assist in commercial lease termination
  • Provide advice for commercial lease disputes

Our experienced lawyers have successfully represented landlords and tenants with their retail and commercial lease inquiries, call (03) 5941 1622 to discuss your needs.

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Frequently Asked Questions

Consent of the Landlord to the Transfer of Lease

During a sale of a business a landlord will often be approached to consent to the transfer of the lease from the current business owner to the purchaser of the business.

It is important that the landlord understands their rights and obligations in relation to any proposed transfer, and seeks legal advice throughout the process. The costs of that advice can be on-charged to the current tenant under both a retail and a commercial lease.

Where the lease is a retail lease, there are limited circumstances under which the landlord can withhold consent to a proposed transfer. These relate to the financial suitability of the proposed tenant or the failure of the proposed tenant to agree to reasonable assignment provisions. However as a landlord of a retail lease, care must be taken to deal with any request for a transfer of lease in a timely manner, as there exists deeming provisions where no response has been received within a specified time frame. Further, care must be taken to review the proposed transfer as against any current breaches of the leasing arrangements.

Where the lease is a commercial lease, the requirements of any proposed transfer will be set out within that document. Care must be taken to ensure that these provisions are followed and satisfied, in order to ensure the timely transfer of any lease.

What is a Retail Lease?

Generally speaking, there are two types of leases with respect to commercial property: retail leases and commercial leases. In Victoria, retail leases are governed by an Act known as the Retail Leases Act 2003 (Vic) (“the Act”).

A retail lease exists where the premises is used wholly or predominantly for the sale or hire of goods by retail or the retail provision of services. There are exceptions that
apply and the minister can also make determinations about types of premises that will or will not be a retail lease.

The primary difference between a retail lease and a commercial lease is that a commercial lease is not governed by particular legislation, whereas if you enter into a retail lease it must comply with the Act. The Act contains various protections for tenants and also certain prohibitions on landlords.

Some examples would be the extent of information that must be disclosed to a tenant, the way rent reviews are conducted, the minimum term the retail lease must proceed for and the types of outgoings in connection to the premises the landlord may recover from the tenant.

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