Once you've decided to lease a premises, use our checklist on retail lease agreements to ensure you know the right questions to ask before you sign.
Best-practice behaviour
When leasing a retail or commercial space:
- Use the Victorian Small Business Commission's (VSBC) website as a resource.
- Contact your industry association for any lease negotiation assistance.
- Understand your and your landlord's obligations when you sign a lease.
- Know the lease requirements, commercial or retail, including the Retail Leases Act 2003
- Consult an adviser for any contract and legal questions you may have.
- Find out about zoning, permits and building requirements for your premises.
- Plan financial arrangements, payments, taxes and cash-flow.
How the VSBC can help with your lease?
A good starting point is VSBC, which offers support for both tenants and landlords. The VSBC website has information on:
- land tax
- assigning or ending a lease
- compensation
- maintenance and repairs
- outgoings
- renewals
- security deposits
- leasing rights and responsibilities.
Your right to a 5-year lease
In line with section 21 of the Retail Leases Act 2003, you're entitled to at least a 5-year lease. This includes the initial term, and any further term or terms provided for by any options for renewal.
What the landlord and tenant have to do
The tenant and landlord must follow certain steps for a transfer of the lease.
For a new retail lease, the landlord is legally required to give the tenant:
- a written lease with matters agreed to and signed off by both parties
- a copy of the proposed lease as soon as the lease negotiations start
- a disclosure statement
- the VSBC Information Brochure as soon as the lease negotiations start
For retail leases, the landlord must detail the outgoings the tenant has to pay.
VSBC has a copy of the landlord's disclosure statement that covers the types of outgoings the tenant may have to pay.
The Retail Leases Act 2003 covers the obligations for both the landlord and tenant. For example, the landlord must repair and maintain the premises in the same condition as at the start of the tenancy.
Fixing a lease dispute
1. Try to fix it yourself
Conflict and disputes between landlords and tenants are a fact of life. If you find yourself in a dispute, your first step should be to try to resolve the issue.
Speak directly and politely with the other party, and try to negotiate so both parties will be satisfied with the outcome. If possible, aim for a win/win rather than a win/lose outcome.
Visit our pages on resolving retail lease disputes for more information.
2. Contact the VSBC
If your first step fails, you should contact the VSBC which provides a speedy and low-cost dispute resolution process.
The VSBC aims to help you resolve a dispute before it becomes legal action by organising mediation sessions between tenants and landlords with independent mediators.
3. Contact the Victorian Civil and Administrative Tribunal
For a matter to proceed to the Victorian Civil and Administrative Tribunal (VCAT), the VSBC must issue a certificate stating that mediation was tried and failed.
VCAT will conduct a formal hearing and make a determination. It can order a party who refuses to take part in VSBC mediation to pay the costs of the other party.