A Lease is a legal agreement that is binding upon you once entered into and it is extremely important your understand your rights and obligations within the Lease as it is a significant financial commitment.
Are you looking to rent a space to carry out your business?
Generally, you will be required to enter a Lease with the owner of the premises, the Landlord, following a negotiation surrounding the terms.
Before leasing a property, it is important to consider issues such as whether the premises are suitable for your business, whether it is in the right location for your business, and whether you will be able to afford the upfront and ongoing financial obligations for the duration of the Lease.
It is also imperative to ensure you obtain advice from the Local Council as to whether you can carry out your business usage within the leased premises. If you are planning to undertake work on the premises so it suits the requirements of carrying out your business, such as fit-outs and or structural alterations, you should also check with Council whether your intended works will require Council approval.
When you sign a Lease, you are making a commitment to pay rent, including any ongoing rent increases for the duration of the Lease. Your Landlord will not be required to reduce the rent payable or waive it if you are unable to make the payments as and when they are payable. Failing to pay your rent can result in the Landlord taking possession of the premises and, you can still be liable for the payment of rent and additional monies for breaching the terms of the Lease.
In addition to the rent, there are further outgoing costs to consider such as the payment of rates and taxes for the premises, as well as utilities and usage costs.
In commercial Leases, the Tenant will often be liable for the Lessor’s legal costs in the preparation and registration of the Lease.
It is extremely important you obtain legal advice before entering into a Lease as there are many aspects that require consideration before it is executed, and you create a legal obligation for yourself and your business.