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1300 COMLAW (266 529)

02 4704 9991

Suite 11, 354-360 High Street, Penrith NSW 2750
PO Box 1835 PENRITH NSW 2751

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Negotiating Your Lease

Whether you are a small or large business most people need to lease a premises for their shop, store or office.

This can be daunting as you might be a fantastic business person but lack of experience when it comes to negotiating the terms of a commercial lease.

You should always have a solicitor to provide you with advice before signing.

To assist in the process however you may need to negotiate some terms with the real estate agent or landlord before the Lease is prepared.

These are the things you should think about when negotiating:

  1. Term of the Lease
    This is usually expressed in years. Make sure you don’t over commit with the amount of years in the initial term as you will be locked into the Lease for this period.
  2. Option
    Some Leases will have an option for you to extend the Lease after the expiry of the initial term. If you want an option, you should negotiate this from the start.
  3. Rent
    Rent is usually payable monthly but expressed as a yearly amount. Make sure you check whether or not the proposed rent is inclusive of GST.
  4. Outgoings
    Sometimes you will need to pay money in addition to your rent for things like waters usage and cleaning. Make sure you are aware of these before you enter into your Lease.
  5. Rent Review
    A review of your rent will normally take place on each anniversary of the Lease. This will usually involve an increase to your rent in reference to the Consumer Price Index, current market rent or an increase by a fixed percentage.
  6. Bank Guarantee/Security Deposit
    You usually need to hand over a cheque or a bank guarantee that acts as a security bond. This is in addition to your rent is like a bond that you would pay in a normal residential tenancy agreement.
  7. Maintenance and Repair
    A lot of leases require you to perform maintenance and repair on things like air conditioning. You will usually also have to refurbish the premises at the end of your lease.

If you are a landlord you need a Lease prepared or a tenant who needs some advice on a Lease, contact one of our lawyers today to set up a meeting so we can assist you.