Retail commercial leasing can be a complex area. Here is a guide to help you understand the key factors that may affect you and your business when you sign a retail lease.
What is a Retail Lease?
A retail lease is a type of commercial lease that relates to retail premises. Retail leases in Victoria are in most cases governed by the Retail Leases Act 2003 (Vic) (“the Act”).
Is My Business Covered by the Act?
If your business mainly sells or hires goods or services to the public, then your premises will likely be considered ‘retail premises’ under the Act.
Some examples of ‘retail premises’ are:
1. Cafes and bars
2. Clothes shops
4. Beauty Salons
Some examples of businesses not caught by the Act:
1. If your business is primarily used for wholesaling, manufacturing or storage
2. If your cost of occupancy is more than $1m per year
3. If the term of the lease is less then one year (unless consecutively renewed)
4. You’re a listed corporation or a subsidiary of a listed corporation
5. Your business has been granted an exemption.
In all of these cases your premises are generally not considered ‘retail premises’ and therefore the Act will not apply to your business.
What Should The Landlord Give Me Before I Sign a Retail Lease?
The Act requires the landlord to give the tenant the following:
1. A copy of the proposed lease at least 7 days before you sign the lease
2. A copy of the Victorian Small Business Commissioner Information brochure on retail leases
3. A disclosure statement at lease 7 days before you sign the lease
Once you’ve signed the lease the landlord is required to provide you with a copy of the fully signed lease within 28 days.
Need legal advice?
If you’re thinking about signing a retail lease and would like a leasing expert to guide you through the process, you can get a Quick consult with experienced lawyers. With Quick Consult, you can check out in minutes and for a transparent, flat fee, the lawyers will call you back on the phone within 1-2 days to answer your questions and give you legal advice.
This article is written by Karen Finch and was first published on the Legally Yours website.
This article does not constitute legal advice or a legal opinion on any matter discussed and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and practice in this area. If you require any advice or information, please speak to practicing lawyer in your jurisdiction. No individual who is a member, partner, shareholder or consultant of, in or to any constituent part of Interstellar Group Pte. Ltd. accepts or assumes responsibility, or has any liability, to any person in respect of this article.