• Wendy Thomson

Hidden Commercial Investment Property Risks

As a bank guarantee or a security deposit is provided by a Tenant as a form of security for the Landlord in the event of any default during the term of the lease.


If security in the form of either a bank guarantee or security deposit are held under the terms of each lease, as a Landlord do you know where these are held. A Bank guarantee is as important as a property title! You can only draw on or cancel a bank guarantee if you have the original document.


If there is a cash security deposit held – do you know where and how the funds are held?


Under the Retail Leases Act 2003 security deposits in the form of cash are required to be held in trust in an interest bearing account.


If your commercial property is managed by a real estate agent or property consultant do they hold these types of securities – bank guarantees and cash security deposits in line with the required legislation? Have you checked to confirm where the funds are held?


I would strongly suggest that perhaps as part of your risk management as a Landlord and Commercial Property Investor moving into the 2017-2018 you seek confirmation and proof in writing to confirm the funds are correctly held in line with legislation.


 For expert practical Commercial Property Investment and Lease advice please contact Wendy Thomson by email  wendy@cpmscommercial.com.au for a confidential discussion.

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