Landlords of retail premises in Queensland will shortly be required to provide new tenants with a new form of disclosure statement.
Current Position
Currently, the form of disclosure statement required to be given by landlords of retail premises varies from State to State. For example, a Landlord of retail premises in Queensland is required to disclose different information about the retail premises (and the shopping centre as a whole) to a landlord of retail premises in Victoria.
Why the change?
It is anticipated that the nationally harmonised form of disclosure statement will have benefits for both landlords and tenants.
Landlords will benefit from a reduced regulatory burden, particularly those landlords who own and operate shopping centres in multiple States.
Tenants will benefit from the increased disclosure by landlords regarding certain provisions in the retail shop lease so that they are better informed of their rights and obligations under the lease, and may therefore make better decisions about their business.
When is the change taking place?
It was anticipated that the nationally harmonised form of disclosure statement will come into effect from 1 September 2010. However it is now anticipated that these changes will commence on 1 January 2011. It is understood the necessary regulations in each State will be gazetted soon.
What has changed?
There are a number of items in the nationally harmonised form of disclosure statement which add to and/or expand on the information provided under the current Lessor Disclosure Statement provided under the Retail Shop Leases Act 1994 (Qld). A few points to note in the new form of landlord disclosure statement are:
- whether the landlord intends conducting a survey of the premises;
- expanding the list of existing items in the premises which will be provided by the landlord (excluding any landlord works, tenant’s fitout and refurbishment works);
- a warning to the tenant that it should investigate whether the proposed use of the premises is lawful under relevant planning laws;
- whether the tenure for the Shopping Centre is granted under a Head Lease or Crown Lease;
- whether the landlord is providing any “fitout contribution” to the tenant;
- detailing the landlord’s requirements (if any) as to the quality and standard of shop front and fitout;
- in addition to rent free periods, whether there is any “outgoings free period”;
- whether the tenant is permitted to access the Shopping Centre and the premises outside the core trading hours of the Shopping Centre;
- breaking down the annual estimated turnover of the Shopping Centre into certain categories;
- requiring the landlord to give (or not give) assurances to the tenant as to the current tenancy mix of the Shopping Centre;
- confirmation of whether the landlord has adopted the Shopping Centre Council of Australia’s Casual Mall Licensing Code of Practice; and
- disclosure by the landlord of any current legal proceedings regarding the lawful use of the Shopping Centre or the premises.
Where to next?
There is nothing for retail landlords to put into action straight away. We will keep you updated as to the likely commencement of the new harmonised form of landlord disclosure statement.
If you have any questions around landlord disclosure statements, please do not hesitate to contact a member of our Property Team:
Brisbane
Matthew Rollason | Partner
T +61 7 3100 5041
Heath Gleig-Scott | Lawyer
T +61 7 3100 5152
Sydney
Bill Burrough | Partner
T +61 2 8233 9711
