Did you know that if you don't prepare your Retail Lease correctly, your tenant could terminate on you, or you could be subject to a fine of up to $5,000?
What do I need to do?
There are a couple of crucial steps that you need to go through if you are the landlord when preparing a Retail Lease, these include:
- Providing the tenant with a Lessor's Disclosure Statement
- Prior to offering to enter into, or offering to enter into a retail lease you must:
- have available, in your possession a physical copy of the proposed lease (this would include your agent having a copy)
- make available to any prospective lessee a copy of that lease
- make available to any prospective lessee a copy of the retail tenancy guide as prescribed by legislation
How do I do that?
A Lessor's Disclosure Statement is a very specific defined document, and if you provide a document that you think is an LDS but it doesn't meet the legislative requirements then, for all intents and purposes, you haven't provided the statement.
A Retail Lease is also itself a very specific defined document and must include certain information prescribed by legislation or, much like a contract for sale of land, it will be invalid. The retail tenancy guide is available online and can be printed from a government website.
When do I need to do it?
You need to provide the Lessor's Disclosure Statement at least 7 days before the lease is entered into.
You need to provide the proposed Retail Lease and the retail tenancy guide to the prospective tenant as soon as the person enters into any negotiations concerning the lease.
What if I didn't do it?
If you do not give a Lessor's Disclosure Statement, or you give an incomplete one, or it was false or misleading, the lessee can terminate the lease by notice in writing to the lessor any time within the first six months of the Lease. You are also guilty of an offence for failing to provide the statement and liable to a fine up to $5,500 and this fine would apply to the landlord or potentially the landlord's agent.
If you don't give every prospective tenant a copy of the proposed lease and the retail tenancy guide as soon as the person enters into any negotiations then you and your agent are liable for a $5,500 fine.
So, failure to meet both of these requirements could make you and your agent liable for $11,000 in fines, and out of pocket costs (loss of rent for example) while you find a new tenant.
Who do I speak to?
Bruce also has extensive experience in property matters, having acted during his career for many individuals purchasing or selling a house, applying to Council for various approvals, assisting clients who are the subject of a compulsory acquisition, or acting for lessors or lessees in relation to entering into leases or enforcing their rights. In addition to working for individual clients in private practice as a solicitor for all that time, he was a legal advisor to three local councils for many years, and has lectured in real estate law at university. He understands more than just your basic conveyance, and is well equipped to assist you with all aspects of your property transactions.