Why You Need a Landlord Disclosure Statement for Your Retail Lease

Landlords are required to provide their prospective retail tenants with a Disclosure Statement which gives an overview of the key terms of the lease.

What is the purpose of a Disclosure Statement?

When a landlord enters negotiations with a potential tenant they are required to commit to writing all the aspects of the lease that could impact on the tenant’s occupation.

The Disclosure Statement should include, among other things, the amount of the rent payable, the lease term, outgoings that the tenant would be responsible for, fitout requirements, renewal options and information about the shopping centre where applicable.

Its purpose is so that the tenant can make an informed decision about the leasing arrangements on offer.

What are the consequences of failing to provide an accurate Disclosure Statement?

The Disclosure Statement should be provided as soon as negotiations begin (at least 7 days before a new retail lease). If the landlord does not issue the statement or provides one that is materially false, misleading or incomplete, the tenant may terminate the lease within the first 6 months and will have a claim for compensation.

The tenant cannot terminate the lease for inaccuracy if the landlord acted ‘honestly and reasonably’ and the tenant has not been disadvantaged.

Contact our Retail Lease Lawyers in Sydney, NSW

Both parties to a retail lease arrangement need to be fully conversant with both their rights and obligations. At Szabo & Associates Solicitors we advise both landlords and tenants on retail and commercial leases including a pragmatic approach to disputes that may arise. Please contact us on 02 9281 5088 or complete the online contact form.