Part two: What to do before signing a Commercial or Retail Lease

Welcome to Part 2 of “What to do before signing a Commercial or Retail Lease“. You can find Part 1 here.
Legal Advice about Terms
It’s important to understand that upon signing the lease, both parties will be bound by its terms and conditions.
Consequently, you need to make sure the lease covers what was discussed and that compliance with the terms will not be an issue once you sign or take possession of the premises.
You should check what the lease terms say about outgoings and any repairs and maintenance requirements, such as for the fixtures or fittings of the property and the requirement for making good at the end of the lease.
Before signing a commercial lease, consider how each term will affect the business you’re running. For example, if there is a demolition or relocation clause, this means that you are signing the lease with some expectation that the landlord will end the lease before its expiry date and may wish to reconsider the premises.
Is an option term preferable?
Before you sign the lease, you and your accountant should try to punch in the numbers to work out how achievable profitability will be in the first term of the lease. This is important to know, as the landlord may choose not to renew the term, and you may not yet have made profit. With no lease, selling the business will be near impossible. Any opportunity to pay off remaining debt might be lost if the landlord does not renew the term.
Instead of signing for one term, you might want to have your leasing lawyer negotiate an option (or a number of options) to renew, as part of the terms in your commercial lease. This goes towards protecting your lease tenure and also your investment in the Premises by making the business more saleable.
Once the initial lease term ends, your landlord may offer you another term at much higher rent. If you operate in a shopping centre, additional fit-outs might also be required.
Conclusion
There are countless measures you can take to protect yourself before signing a commercial or retail lease. Speak to a professional leasing specialist about how they can assist you in the process leading up to the singing of the lease, as well during the lease itself.
If you want to speak with a commercial leasing lawyer about a lease you’re about to enter, contact LegalVision on 1300 544 755.
Redundancies and Restructuring: Understanding Your Employer Obligations
Thursday 7 July | 11:00 - 11:45am
Online
How to Sponsor Foreign Workers For Your Tech Business
Wednesday 13 July | 11:00 - 11:45am
Online
Advertising 101: Social Media, Influencers and the Law
Thursday 21 July | 11:00 - 11:45am
Online
Structuring for Certainty in Uncertain Times
Tuesday 26 July | 12:00 - 12:45pm
Online
Playing for the Prize: How to Run Trade Promotions
Thursday 28 July | 11:00 - 11:45am
Online
Web3 Essentials: Understanding SAFT Agreements
Tuesday 2 August | 11:00 - 11:45am
Online
Understanding Your Annual Franchise Update Obligations
Wednesday 3 August | 11:00 - 11:45am
Online
Legal Essentials for Product Manufacturers
Thursday 11 August | 11:00 - 11:45am
Online
Was this article helpful?
We appreciate your feedback – your submission has been successfully received.
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.
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.