Leasing retail shops is a significant financial decision. In addition to the initial capital investment for either the landlord or the tenant, there are costs in operating a business of any kind. It makes good financial sense for landlords and tenants to get advice from qualified professionals about the terms and conditions of a retail shop lease.
Tenants should seek advice about the retail business they intend to operate to ensure that the intended business is viable. Leasing is a substantial commitment resulting in thousands of dollars in rent and other expenses.
There are several things Bottom Line Control recommend taking into consideration when leasing a premises:
- Once a lease is signed, the tenant is responsible for meeting all the costs of the lease until the lease expires.
- Tenants also need to undertake market research and preliminary business planning. Assistance with business planning and research can be obtained online at www.smartsmallbusiness.qld.gov.au.
- Tenants are required by the Act to seek both legal and financial advice before they sign a retail shop lease.
- Tenants who lease less than five retail businesses in Australia must obtain a legal advice report and a financial advice report, and provide these completed reports to the landlord before entering into a retail shop lease or an assignment of a lease.
- The tenant must meet with a lawyer for advice about the legal meaning and effect of certain terms and conditions of the proposed lease.
- The tenant must meet with a qualified accountant for advice about the financial rights and obligations of the tenant under the lease.