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How well are NSW retail tenants protected when renewing their lease under the Retail Leases Act?

Updated: Jun 18

Retail tenants are urged to ensure they know their rights if faced with a large increase in rent - or indeed ANY increase in rent! Retail rents can be negotiated down!

negotiating lease

Due to changes made in 2018 to the NSW Retail Leases Act 1994, if the landlord does not offer you a new lease between 12 and 6 months before your lease expires, you can request for your lease to be extended by a further six months!


In summary, this means the following:


· The retail landlord must notify tenants, in writing, between 6 and 12 months before the impending lease expiry, of their intention to renew the lease, or not (Section 44 (1 a). At that time, the tenant is allowed one month to decide whether to accept that offer – including rent. (Section 44(2)).


· If the landlord fails to give notice, the term is of the lease is extended for an additional six months (Section 44 (3)) providing the tenant makes their request in writing to their landlord before the existing lease expires.


Please note exclusions apply and also does not apply if there is a renewal option in place.

The above is for information only and retail tenants should refer to the whole clause Section 44 within the Act: http://classic.austlii.edu.au/au/legis/nsw/consol_act/rla1994135/s44.html


What's more, retail tenants are protected under the NSW Retail Leases Act 1994 and cannot include a "Ratchet Clause" in their lease, which essentially means that the rent can be negotiated downwards! This of course will depend on the retail rental market conditions at that time.


Lease Negotiation Services are here to help commercial and retail tenants when negotiating their new lease and is currently obtaining huge savings of up to a third of their rent for some tenants. Let us see what we can do for you! No savings No Fee!


Please call us on 0401 996 646 for a confidential discussion or visit https://www.leasenegotiationservices.com.au/

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