Are you ready for the changes to retail leasing?

Posted on April 4th, 2017

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Despite the fact that Retail Leases Act 1994 NSW (“the Act“) has been in operation for some 23 years, compliance with the Act is often rare. 

Just as Practitioners appear to be wrapping their heads around the operation of the Act, the Retail Leases Amendment (Review) Bill 2017 NSW (“the Bill“) was passed by the NSW Parliament on 21 February 2017. The Bill amends the Act in a number of areas. To assist you with understanding the changes as early as possible this time, I have set out the following “Cheat Sheet” warning of the major changes to the Act




  1. Compulsory Registration of Retail Leases

It will now be compulsory that any retail lease for a term of more than three (3) years to be registered by the Lessor within three (3) months following the return of the executed Lease by the Lessee.

  1. Payment of Mortgagee Consent Fees

Any ambiguity surrounding whether Mortgagee Consent Fees are recoverable from a Lessee has now been removed. Mortgagee Consent Fees are not recoverable from the Lessee pursuant to the Act.

  1. Minimum Five (5) Year Term

The automatic five (5) year term for a retail lease has been removed and the requirement to obtain a Section 16(3) Solicitor’s Certificate waiving the minimum five (5) year term no longer applies.

  1. Disclosure of Outgoings

The Lessor must provide careful estimations of outgoings in the Lessor’s Disclosure Statement because if the actual outgoings exceed the estimated outgoings, and no reasonable basis for the discrepancy exists, the Lessee is only liable for the estimated amount provided in the Lessor’s Disclosure Statement.

  1. Increase in NCAT Jurisdictional Limit

The NCAT jurisdictional limit for retail lease disputes has been increased from $400,000.00 to $750,000.00.




  1. Lessee Right to Compensation

If the Lessee is entitled to terminate the Lease within the first six (6) months as a result of a failure to provide a Lessor’s Disclosure Statement or a defective Lessor’s Disclosure Statement, the Lessee is now also entitled to claim an amount for compensation for its expenditure incurred, including, in relation to the fit out of the premises.

  1. Lessor’s Disclosure Statement Amended by Agreement

Lessor’s Disclosure Statements may now be amended by agreement between the parties.

  1. Schedule 1A – Excluded Usages

A new Schedule (Schedule 1A) will be inserted specifying certain uses that are excluded from the operation of the Act including vending machines, communication towers, displays of signage, ATMs, internet booths etc.

  1. Lessee to Provide Updated Lessor’s Disclosure Statement

In the circumstances of an assignment of lease, if the Lessor has not provided an Updated Lessor’s Disclosure Statement within 14 days, the Outgoing Lessee is required to provide the Incoming Lessee with an Updated Lessor’s Disclosure Statement completed to the best of their knowledge.

  1. Online Retail Bond Service

Finally, the Act now contemplates the creation of an online facility to lodge and withdraw Retail Security Bonds.

These changes are not an exhaustive list of all changes that will occur to the Act but should assist in preparing you for the most relevant and important changes to the Act.


Lachlan Page is a Solicitor at Mullane & Lindsay and practises primarily in commercial litigation, commercial property transactions and estate planning and administration.  If you require any assistance in this area please contact Lachlan Page to arrange a consultation or contact our Newcastle office.

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