NEW LESSOR DISCLOSURE IN RETAIL SHOP LEASING: WHAT YOU NEED TO KNOW

From 1 January 2011, owners of property which falls under the Retail Shop Leases Act 1994
(Qld) must provide proposed tenants with the new lessor disclosure statement at least 7
days before a tenant enters into a retail shop lease. The new statement is almost identical
to the lessor disclosure statements already used by owners of retail property in both New
South Wales and Victoria. The introduction of the new lessor disclosure statement in
Queensland is an attempt to achieve a harmonised approach to the disclosure by landlords
as required under each state’s respective legislation.

What are the benefits for landlords and tenants?

Along with achieving a uniform approach to lessor disclosure throughout Queensland, New
South Wales and Victoria, the main benefit to landlords is there will be less administrative
and managerial responsibilities for landlords who own retail property in multiple states. The
main benefit to tenants is that the new lessor disclosure statements will require the
disclosure of more comprehensive and detailed information by the landlord regarding the
premises subject to the proposed lease.

What are the key changes?

Amongst other things, the key changes in the new disclosure statement are the introduction
of the following requirements:

1. The landlord must disclose all details relating to any incentives being offered to the
tenant by the landlord;

2. The landlord must disclose whether there is any casual mall licensing for common
areas;

3. The landlord must disclose whether there are any legal proceedings on foot against
the landlord;

4. The landlord must inform the tenant that it is the tenant's responsibility to ensure
that the use of the premises will comply with the appropriate relevant planning laws;

5. The landlord must disclose the expiry date of the leases of any anchor tenants in the
complex;

6. The landlord must disclose the date by which a tenant is to exercise any option
under the lease;

7. The landlord must disclose how rental payments are to be made;

8. The landlord must attach a plan of the premises (if available) to the disclosure
statement.

What should you do?

All landlords of retail shop space should ensure that all of their information is up to date and
that the new lessor disclosure statement is used for all future retail shop leasing matters.

The advice contained in this newsletter is general in nature. If you require specific advice on
your rights in relation to your lease, please contact us on (07) 3852 5055 or
lucas@redchip.com.au.

Lucas Hewlett
Associate
lucas@redchip.com.au

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