Landlords and tenants of commercial premises both have an interest in ensuring that an appropriate binding commercial lease governs their relationship. The success or failure of the business may depend on the lease containing appropriate terms in a number of aspects. 

17 Tips to Avoid Catastrophes when Taking a Commercial Lease

  1. Compare rents in the surrounding premises;

  2. Understand what is included in “The premises” e.g. storage, outdoor needs, parking etc;

  3. Get all promises from the landlord and agent in writing;

  4. Know the difference between “outgoings” and “services” and who pays/is responsible for the costs;

  5. Know whether the Family House is at risk under the personal Guarantor clauses and consider alterations to the lease/letter;

  6. Understand what you need to do about option clauses;

  7. Check cleaning and relocation clauses!

  8. Know how the rent review clause will work and whether they are fair;

  9. Check the history on maintenance and repairs of the building;

  10. Have a DA before you are committed to a lease;

  11. Think about whether the description of permitted use is appropriate for any changes you are planning for your business;

  12. Think about whether you wish to sublet;

  13. Check for reasonable notice in termination clauses etc reasonableness in heavy clauses;

  14. Negotiable proper easement to sewerage;

  15. Ask neighbouring businesses and look into your rights under parking;

  16. Ask about Fit out allowance and rent free period;

  17. Check the make goods clause.

The landlord is of course interested in obtaining a good return on his investment in the property. This will be achieved by having a good long-term tenant with a stable business. The tenant's interests are focused on the need for appropriate premises for the tenant's business.