There have been recent changes to the Retail Shop Leases Act 1994 which will affect many of our clients. These changes are currently in force, and include the following:
For the Lessee (Tenant):
- If you are leasing a premises with a floor area of over 1,000 metres squared, the Act will no longer apply to you, unless you are a listed corporation or a listed corporation’s subsidiary as defined in the Act. ATM’s will also be specifically excluded for the act to resolve some previous uncertainty in retail shopping centre common area.
- Legal and financial advice reports are no longer required for major lessees.
- Multiple rent review mechanisms can now be commercially agreed with major lessee’s, provided the lessee gives notice to the lessor waiving the rent review provisions in the Act.
For the Lessor (Landlord):
- Lessor’s are no longer required to pay compensation under section 43 where the lessee is entitled to relocation/demolition compensation under section 46G or 46K.
- The lessee can waive the seven day disclosure period for receiving disclosure statements and draft leases from the lessor, however the disclosure statement will still need to be given before the lessee enters into the lease.
- Lessor’s must provide the lessee with a current disclosure statement within seven days of exercise of an option, unless the lessee waives the requirements. The lessee also has the option to withdraw the notice of exercise of option for any reason, within 14 days of receiving the current disclosure statement. Failure to provide the current disclosure statement will also give the lessee termination rights in the first six months of the option.
- If refurbishment is required under the lease, more specific details including of the nature, extent and timing of the refurbishment is required. Any provisions that do not meet these requirements will be void.
- If you recover promotion or marketing levies as a lessor, you must give the lessee an yearly marketing plan showing the details of the proposed amount of money being spent on promotion and advertising. This marketing plan must be provided at least one month prior to the start of each accounting period.
Kelly Lawyers have been incorporating these amendments since they were passed last year. If you have any concerns over these changes and how they will affect you, please contact our office on 07 3268 7199 or by email email@example.com to make an appointment or to speak with one of our solicitors.