Legal

Issue No. 58 - April/May 2011

New leasing laws will test landlords

by Lorenzo Mazzocchetti

Commercial landlords and commercial property managers need to exercise caution when entering into new retail shop leases or undertaking rent reviews of existing leases.

New regulations under the Retail and Commercial Leases Act will increase the number of commercial leases that are governed by the Act.

The Act previously applied only to leases with annual commencing rent of $250,000 or less. That amount will now be $400,000, meaning that many more leases will now be affected.

Where a commercial lease is not governed by the Act, the landlord has much more flexibility with the lease terms that they can agree with their tenant. But if a lease is subject to the Act, various standard terms are imposed. One of those relates to Land Tax. If a lease is subject to the Act, the landlord cannot recover land tax ...

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