Landlords have obligations under the Retail Leases Act 2003 (RLA). As a responsible landlord, it is essential to be aware of your duties to inform tenants about their option to renew a further term under the lease agreement.
Under Section 28 of the RLA, landlords are legally obliged to provide written notice to their tenants regarding their entitlement to renew the lease (Notice). This Notice must be provided to the tenant within a specific timeframe, which is generally not less than three months and not more than six months prior to the expiration of the current lease term.
By fulfilling this obligation, you ensure that your tenants are made aware of their right to exercise the option to renew the lease. This enables them to plan their business operations effectively and make informed decisions regarding their future leasehold.
The Notice must include relevant details such as the date by which the tenant must exercise the option to renew, any conditions or requirements for renewal, and the consequences of failing to exercise the option within the specified timeframe.
It is crucial to note that non-compliance with this statutory obligation may result in legal consequences and potential financial liabilities. One such consequence of a failure to provide the Notice will allow a tenant to remain in the property for 3 months from the time that the Notice was given despite the terms of the Lease. Therefore, we urge you to take the necessary steps to ensure that all tenants under your management are duly informed of their right to renew their lease.
Should you require any further information or clarification regarding the obligations stipulated by the RLA, please seek our advice to ensure compliance with your obligations.
Our team can be reached on 03 9548 5500.
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