Commercial Property Consultants
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CHANGES TO THE RETAIL LEASES ACTSunday 01st November 2020
On the 1st October 2020, the Victorian Parliament passed the Retail Leases Amendment Bill. This amended the standing Retail Leases Act of 2003 and the Building Act of 1993.
There were some significant changes that our retail landlords and tenants need to be aware of. To save you the hassle of finding (and trying to interpret) the information, we’ll break it down for you in two parts. Part I will be information for landlords, and part II will be information for tenants.
Essential Safety Measures: Landlords can now recover the cost of essential safety repairs or maintenance or an installation relating to the fit-out of premises (that the tenant agreed to pay for) onto the tenant. This includes Smoke detectors, Sprinkler systems, Fire extinguishers, Fire exit signs or Annual safety inspections.
Disclosure statements (for landlords):
▪You must give a tenant a disclosure statement and a copy of the proposed lease at least 14 days before entering into a lease agreement
▪This replaces the previous timeframe of only 7 days
▪Failure to do so will see the lease commencement date delayed until 14 days have passed
▪If the lease contains changes to the previous version and you haven’t told the tenant about the changes, you’ll face a fine of $41,305 (corporation) or $8,261 (individual)
Security deposits (for landlords):
▪You’re legally required to return a tenant’s security deposit within 30 days of the lease ending, replacing the previous wording of ‘as soon as practicable’
▪This is pending the tenant has performed all of their obligations under the lease
▪This applies to all retail premises leases entered into from 1 October 2020.
Renewal obligations: If the lease has an option to renew, the landlord, at least 3 months prior, must give the tenant:
▪The date by which the option to renew must be received
▪The amount of rent payable for the first 12 months of the renewed term
▪Information about early rent review and the cooling-off period
▪Any changes to the most recent disclosure statement
If you need further advice on the Retail Leasing Act, feel free to get in touch on 9417 7906 or emailing [email protected]