Frequently Asked Leasing Questions
Below, some frequently asked questions about leasing. For more information, contact Focus Legal.
Q: What is a lease?
A: A lease is a document granting one party the right to exclusive occupation of a property. A lease sets out the commercial agreement between the parties and usually contains the details of the property to be leased, the rent, rent reviews, outgoings, insurance requirements, bank guarantee or security deposit requirements and a number of other commercial terms.
Q: Why should I use a solicitor if I am a landlord?
A: Owning a commercial property is generally one of the largest financial commitments of your life. Commercial tenants tend to enter into leases for longer durations than residential tenants and when the property becomes vacant it tends to take much longer to secure a tenant.
Without a properly prepared lease you could be left in many unfortunate situations, including being unable to get rid of a delinquent tenant or unable to enforce a rent increase. The consequences of making a mistake can be costly and long lasting given the duration of most commercial leases.
By having an experienced property solicitor to prepare your lease, you can minimise the risks to your asset and income.
A solicitor has an in-depth understanding of the law concerning leasing, is required by law to carry professional indemnity insurance, and can offer you their experience on other matters related to your lease that may arise.
Q: Why should I use a solicitor if I am a tenant?
A: Leasing commercial premises is generally one of the largest financial commitments of a business. Tenants often are unaware of some of the hidden costs related to these leases such as the exact outgoings requirements, the specifics of market rent review clauses and the make good obligations at the end of the lease that can add thousands of dollars of expense at the end of a lease. In addition, tenants often believe landlords have obligations to the tenant under the lease that are not inserted into a lease by default.
Lease documents are generally complex documents and small changes in drafting of the documents can have significant effects on the tenant.
Without a properly reviewed and negotiated lease tailored to your requirements you could be left paying a lot more than you expected and without recourse in situations such as building leaks and renovations interrupting your business and without a right to get out of the lease in those circumstances.
By having an experienced property solicitor to review and negotiate your lease, you can minimise those risks.
A solicitor has an in-depth understanding of the law concerning leasing, is required by law to carry professional indemnity insurance, and can offer you their experience on other matters related to your lease that may arise.
Q: What is an outgoing?
A: Outgoings are amounts that the landlord spends in relation to the property such as Council and water rates, building maintenant, gardening, pest treatment and insurance. Depending on the agreement between the landlord and the tenant the lease can either be a gross lease (such that the rent specified includes all outgongs) or a net lease (such that the rent does not include outgoings and outgoings are separately payable by the tenant).
Contact us to arrange a consultation with an experienced property lawyer.