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Do you need a Commercial or Retail Lease in South Australia?

Before we jump into the commercial lease agreement template for South Australia there are a few things you might want to consider.

In SA, you need to be careful that your commercial lease is not deemed to be a "retail shop lease" and subject to the Retail and Commercial Leases Act 1995. The confusing factor is the premises do not have to be "retail" or a "shop" to be caught by the Act.

A "retail shop lease" includes any business premises which are used (even to a small extent) for the sale of goods to the public by retail, or the provision of services to the public, or are business premises to which the public is invited to negotiate for the supply of services.

Consequently, this definition widens the scope of the Act, and accordingly any lease where the tenants provide any type of service to the public would fall under the definition of a "retail shop lease".

So what does this mean?

Only use this commercial lease if the premises are used primarily for wholesaling, manufacturing or storage and you can be sure your tenant is not dealing directly with the public.

Some examples of retail shop premises

  • retail shops that sell merchandise;
  • bars, nightclubs, cafes and restaurants;
  • service stations, mechanical repair workshops and hire car outlets;
  • fitness centres and gymnasiums;
  • equipment hire shops;
  • credit unions, banks and post offices;
  • hotels, motels and other accommodation;
  • beauty and nail salons, hairdressers;
  • alternative health and massage therapists;
  • medical centres, law firms;
  • accounting and financial service providers; and
  • architects and surveyors offices.

The basic understanding is that retailing requires a product or service to be provided ‘to an ultimate consumer for a fee or reward’.

We’ll leave it up to you to decide whether you need a retail or commercial lease.

Utimately, it is your use of the premises that determines whether or not your lease is subject to the Act.

If the premises is a ‘retail shop’, the Act applies and you will need a retail lease

If the premises isn’t a ‘retail shop' then the Act doesn’t apply and this Commercial Lease will be suitable.

Still not sure or need some guidance - give us a call on (02) 6672 5904.

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