Retail Shop Leases in Queensland
The Retail Shop Leases Act 1994 (Qld) introduces mandatory minimum standards for retail shop leases in Queensland.
A retail shop lease can be a major financial investment. It is common for landlords of retail shops to require personal guarantees for retail shop lease obligations, so a bad retail shop lease can often leave a tenant facing personal bankruptcy.
Under the landlord and tenant disclosure obligations under the Retail Shop Leases Act, a tenant must provide the landlord with an independent legal advice certificate.
Going beyond that requirement, there are a number of reasons why a prospective tenant of a retail shop should take legal advice. The Retail Shop Leases Act includes many protections for tenants, but if you are not properly advised you may miss out on some or all of the benefits of the act.
Some of the issues that we encounter when reviewing leases for our client are as follows:
- tenant not realising that the property they are leasing is covered by the Retail Shop Leases Act;
- lease not meeting the minimum standards of the Retail Shop Leases Act;
- landlord’s incorrectly charging fees or outgoings that are not recoverable;
- inappropriate rent review mechanisms; and
- tenants potentially missing an opportunity to terminate an unfavourable lease in the first 6 months for non-disclosure.
Landlords also need to take particular care when dealing with retail shop leases. If their leases are incorrectly drafted, they may find themselves with unfavourable outcomes on issues such as rent reviews, outgoings and costs or in extreme circumstances, may lose a tenant that would otherwise be contractually bound.
Hillhouse Burrough McKeown has extensive experience in retail shop leasing acting for both landlords and tenants and can advise you to ensure that you are in the best possible position you can be having regard to the provisions of the Retail Shop Leases Act.