Commercial and Retail Leases
Updated: Oct 25, 2020
Recently I was asked by a colleague to review a draft lease document he had been provided by an owner of a Commercial property in Victoria, he was interested in leasing this property and required some practical advice on the terms offered within the document.
On a very quick perusal of this lease I realised that it was highly likely the landlord had downloaded this document from the internet – perhaps thinking he was on a winning streak and saving legal and other fees.
The lease provided was not a Commercial Lease under the jurisdiction of Victorian legislation. In fact the document was made up of General Conditions along with a Lease Schedule which set out the terms of the negotiated terms and conditions. The lease schedule and the general conditions did not match up and link together, basically the whole document did not make sense at all. My immediate advice to the client was to seek legal advice prior to considering any lease and to not proceed with this particular lease.
Leases on Commercial Property are generally a number of years with options for further annual terms so any lease document signed by a Landlord and a Tenant may bind the parties to onerous obligations for a long period of time. Aside from the risks of a lease document potentially providing false, misleading or just plain terms which don’t make sense and no one understands, the risks to both parties to the lease can be extremely high.
Any disputes over the lease or tenure of the property could lead to long and costly legal processes without any guarantee of a win-win for any of the parties to the lease.
Always seek legal advice from a legal practitioner who actually understands commercial and retail leasing prior to proceeding with any lease or other types of agreements on commercial property.