Reading time: 4 minutes

Broadly speaking, there are two types of commercial leases: 

  • commercial, and
  • retail.

Unlike commercial leases, retail leases are state specific. In other words, legislation in each state and territory sets out how retail leases operate, a lessor’s obligations and a tenant’s rights. Consequently, tenants who occupy commercial premises have less protection than their retail counterparts.

This article explores five key points a tenant should keep in mind when reviewing their commercial lease, in particular, the repair and maintenance clauses.

1. Check Whether the Retail Lease Legislation Applies

As noted above, tenants under a commercial lease have less legislative protection. The first step is then to determine whether your lease is a commercial or a retail lease. 

The definition of ‘retail premises’ differs from state to state. It’s possible that the landlord has provided you with a commercial lease, but your premises could fit the definition of a ‘retail premises’. If this is the case, additional leasing protections could apply.

2. Inspect the Premises

You should thoroughly inspect the premises before signing the lease to determine the condition of the property at the beginning of your tenancy.

The inspection should include matters such as:

  • Does all the equipment function appropriately? 
  • Does the premises need any repairs to the structure, services or overall condition? For example: 
    • Are the electrical connections working appropriately? 
    • Are the locks and doors in good condition? 
    • Are the drainage pipes clear?
    • Is there any evident water damage?

Ensure that your lease only requires you to return the premises to the condition it was in when you started. If the landlord or previous tenant has not freshly painted the property, but your lease requires you to repaint the premises at the end of your lease, that’s hardly fair.

3. Include Landlord or Agent Promises In the Lease

If you’ve inspected the premises and the landlord (or the landlord’s agent) has agreed to make particular repairs or works to the premises before or when the lease starts, ask the landlord to insert these representations in the lease.

This way, you can rely on the lease if the landlord does not undertake the repairs. You may also want to include clauses where the landlord guarantees that they will maintain particular aspects of the property, for example: 

  • connections for services like electricity, gas and telephone, and
  • the working condition of any equipment, such as an air conditioner.

4. Understand Each Parties’ Obligations

If retail lease legislation does not cover a lease, then the deed of lease will determine the parties’ obligations. This means if the lease does not cover the obligation to repair and maintain the premises either by the landlord or the tenant, the premises may not need to be maintained and can technically fall into disrepair.

It’s important that you check the repair and maintenance clause to determine the amount of assistance you can obtain from the landlord throughout the length of your tenancy.

5. Insurance

Most leases require the tenant to obtain certain insurances, for example: 

  • public liability insurance and plate glass insurance, or 
  • insurance for damage to your property or equipment at a minimum.

The landlord, however, will also likely have its own insurance obligations, such as building insurance. Check that you have the appropriate insurances in place, so you are covered when maintenance and repairs are needed. 

Key Takeaways

Entering into a commercial lease may seem like a straightforward process. However, each commercial lease differs as do the obligations of the tenant and the landlord. It forms the basis of your relationship with the landlord and determines the level of assistance and support you receive throughout the term of the lease. 

Accordingly, you should have a specialist leasing lawyer review the document and negotiate any amendments to ensure it is fair. If you have any questions or need assistance reviewing a commercial lease, get in touch on 1300 544 755.


Redundancies and Restructuring: Understanding Your Employer Obligations

Thursday 7 July | 11:00 - 11:45am

If you plan on making a role redundant, it is crucial that you understand your employer obligations. Our free webinar will explain.
Register Now

How to Sponsor Foreign Workers For Your Tech Business

Wednesday 13 July | 11:00 - 11:45am

Need web3 talent for your tech business? Consider sponsoring workers from overseas. Join our free webinar to learn more.
Register Now

Advertising 101: Social Media, Influencers and the Law

Thursday 21 July | 11:00 - 11:45am

Learn how to promote your business on social media without breaking the law. Register for our free webinar today.
Register Now

Structuring for Certainty in Uncertain Times

Tuesday 26 July | 12:00 - 12:45pm

Learn how to structure to weather storm and ensure you can take advantage of the “green shoots” opportunities arising on the other side of a recession.
Register Now

Playing for the Prize: How to Run Trade Promotions

Thursday 28 July | 11:00 - 11:45am

Running a promotion with a prize? Your business has specific trade promotion obligations. Join our free webinar to learn more.
Register Now

Web3 Essentials: Understanding SAFT Agreements

Tuesday 2 August | 11:00 - 11:45am

Learn how SAFT Agreements can help your Web3 business when raising capital. Register today for our free webinar.
Register Now

Understanding Your Annual Franchise Update Obligations

Wednesday 3 August | 11:00 - 11:45am

Franchisors must meet annual reporting obligations each October. Understand your legal requirements by registering for our free webinar today.
Register Now

Legal Essentials for Product Manufacturers

Thursday 11 August | 11:00 - 11:45am

As a product manufacturer, do you know your legal obligations if there is a product recall? Join our free webinar to learn more.
Register Now

About LegalVision: LegalVision is a commercial law firm that provides businesses with affordable and ongoing legal assistance through our industry-first membership.

By becoming a member, you'll have an experienced legal team ready to answer your questions, draft and review your contracts, and resolve your disputes. All the legal assistance your business needs, for a low monthly fee.

Learn more about our membership

Need Legal Help? Submit an Enquiry

If you would like to get in touch with our team and learn more about how our membership can help your business, fill out the form below.

Our Awards

  • 2020 Innovation Award 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice Award 2020 Employer of Choice Winner – Australasian Lawyer
  • 2020 Financial Times Award 2021 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review
  • 2021 Law Firm of the Year Award 2021 Law Firm of the Year - Australasian Law Awards
  • 2022 Law Firm of the Year Winner 2022 Law Firm of the Year - Australasian Law Awards