Leasing information for professionals
Professionals advising tenants and landlords about the risks associated with retail leasing have responsibilities under the Business Tenancies (Fair Dealings) Act.
Tenants and landlords may seek the advice of lawyers for advice on any of the following topics:
- how rent is to be calculated and reviewed under the lease
- liability to contribute to the landlord’s outgoings and how outgoings are calculated
- any other payments required under the lease and how they are calculated
- term of the lease
- special or unusual terms or clauses
- repayable security deposit or guarantees required
- whether or not the lease contains an option to renew and the rights of the prospective tenant or prospective assignee if there is no option to renew obligations of the prospective tenant or prospective assignee at end of lease
- whether or not the lease contains a relocation clause and if it does, the Way the clause operates
- permitted use and exclusivity of permitted use
- consequences of breaching lease conditions.
Leases for less than five years
If a tenant wants to enter into a lease with a term of less than five years, they require written certification from a lawyer.
Lawyer may only provide written certification if they are a solicitor or barrister admitted to practise in the Northern Territory.
If you are a member of CPA Australia, the Institute of Chartered Accountants or the National Institute of Accountants, and you hold a current practising certificate, you may consider providing advice to tenants and landlords on any of the following matters:
- rent, outgoings and other payments
- potential financial impact of the rent review
- any operations of business that are restricted by the term of the lease
- other financial rights and obligations
- the tenant’s business plan.
Annual audited statements
Landlords must provide an annual audited statement of outgoings within three months after the end of the period to which the statement refers.
These statements must be prepared in accordance with relevant principles and disclosure requirements of applicable accounting standards, and accompanied by a report prepared by a person who holds a public practice certificate issued by an accountant's body.
For specialist retail valuers
To be appointed to undertake a current market rent determination you must have at least five years’ experience in valuing retail shops.
Determinations must be provided to the tenant and landlord within one month of your appointment as a specialist retail valuer.
When determining current market rent, you must take into account all of the following:
- the provisions of the lease
- the rent that would reasonably be expected to be paid for the shop if it were vacant and offered rent for similar use to which the shop may be leased
- the gross rent, less the landlord's outgoings payable by the tenant
- rent concessions and other benefits that are frequently or generally offered to prospective tenants of unoccupied retail shop
- the value of the goodwill created by the tenant’s occupation
- the value of the tenant’s fixtures and fittings on the retail shop premises.
Access to information
You may ask the landlord to give you information you consider necessary for determining current market rent.
If the landlord fails to provide this information within 14 days of your request, you may apply to the Commissioner of Business Tenancies for an order that the landlord comply.
Last updated: 15 December 2016