DO I PAY RENT FOR APRIL, OR MAY?
If you can and not impacted, then yes - act in good faith, but for most companies, not yet. In light of the freeze coming, we would recommend not paying next month’s rent. If you have an auto-payment setup, put that on hold. You probably need cash reserves for more urgent matters.
DO I NEED TO SPEAK TO MY LANDLORD?
Yes, don’t leave your landlord in the dark regarding your approach. We are all in this together.
HOW IS THE GOVERNMENT ASSISTING?
The Commonwealth Government announced on 29 March, that landlords will not be able to evict tenants who are unable to pay their rent due to financial stress caused by COVID-19 for the next six months. Further information will be provided soon through our blog.
WHEN MY LEASE COMES UP FOR RENEWAL, SHOULD I EXERCISE MY OPTION FOR ANOTHER TERM, OR HOLD OFF?
The current landscape is changing rapidly. While having certainty about your future accommodation is important, we would suggest delaying the decision for as long as possible to allow new legislation and market conditions to catch up.
WHAT IF MY LANDLORD DOESN'T WANT TO ASSIST AND IS NOT OFFERING RENTAL RELIEF?
Currently there is no formal legislation, just a directive from Scott Morrison to sit down and be reasonable. All parties need to be considerate of the various position and stresses.
I CURRENTLY HAVE A HEADS OF AGREEMENT IN PROGRESS, SHOULD I PROCEED?
A Heads of Agreement is a common part of the process of negotiating a retail/commercial lease transaction. On some occasions the HOA is binding, and further legal advice should be sought.
I'VE CLOSED MY BUSINESS DUE TO THE RESTRICTIONS ON NON-ESSENTIAL BUSINESS. I SIMPLY CANNOT AFFORD MY RENT BEYOND NEXT MONTH. SHOULD I FORFEIT MY LEASE?
You should seek legal advice. Most leases are likely to remain ‘on foot’.
I AM RETHINKING MY SPACE. IF MY LEASE IS EXPIRING SHORTLY, IS NOW A GOOD TIME TO CONSIDER REDUCING MY OVERALL SPACE AND OVERHEADS?
Each business is unique. Given the current climate we find ourselves in, business owners in the short term are preserving cash reserves to ensure long term viability. Whilst there may be an initial need to reduce one of the largest costs of your business, there are many other considerations including spatial efficiency, staff and client access and travel times, remote working options, whether you need main road exposure, as well as your current make-good obligations in your lease.
WHERE CAN I GET MORE HELP?
Speak with one of our experts about your obligations under your retail or commercial lease, and for advice on negotiations. Contact Us to learn more.
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