Relocation

ACT

See sections 136-138. A provision in a lease allowing relocation of the tenant must require the landlord to:

• give the tenant at least 3 months' written notice; and
• offer to provide alternative comparable premises for a period equivalent to the unexpired term of the lease on terms no less favourable than the original lease.

Comparable premises include premises that have not yet been built.

The tenant may give written notice to the landlord (within 1 month after receiving a relocation notice) of the tenant's intention to terminate. If the tenant does elect to terminate, termination takes effect 3 months after the relocation notice was received unless otherwise agreed by the parties.

If the tenant accepts the relocation offer, the landlord must give the tenant a new lease in accordance with that offer and the landlord must pay the tenant's reasonable costs of relocation and pay reasonable compensation to the tenant for any other loss or damage incurred because of the relocation.

See section 137. A provision in a lease that allows the tenant to be relocated other than so the landlord can repair, refurbish, redevelop or extend a shopping centre is void.

See section 138. The landlord must not use a provision of a lease that allows relocation of the tenant within a shopping centre because of proposed repairs, refurbishment, redevelopment or extension unless:

• the proposed repairs, refurbishment, redevelopment or extension cannot practicably be carried out without vacant possession of the premises; and
• the landlord presents the tenant with a plan for the repairs, refurbishment, redevelopment or extension.

The proposed repairs, refurbishment, redevelopment or extension must be carried out within a reasonable time after the relocation of the tenant.

The relocation provisions of the Act only apply to leases for premises in the retail areas of shopping centres (see section 128).

NSW

See section 34A. Certain provisions in the event of a relocation clause being included in a lease are implied as being included in a lease. The tenant cannot be required to be relocated unless:

• details of a genuine proposed refurbishment, redevelopment or extension have been provided;
• the landlord has given at least 3 months' written notice of relocation and the notice gives details of an alternative shop to be made available; and
• the tenant has received an offer of a new lease of an alternative shop on the same terms and conditions for the remainder of the term of the existing lease (with the subject rent being adjusted to take into account differences in the commercial values of the existing retail shop and the alternative shop at the time of relocation).

The tenant is then entitled to terminate the lease within 1 month of receiving the relocation notice. In this event, the lease terminates 3 months after the relocation notice is given. The landlord is to pay the tenant's reasonable costs of the relocation (including dismantling and re-installing of fixtures and fittings and legal costs).

If the tenant does not give a notice of termination, the tenant is taken to have accepted the offer of an alternative lease as offered.

The tenant is entitled to payment by the landlord of the tenant's reasonable costs of the relocation.

If landlord and tenant cannot agree on what is a reasonable amount of costs, the amount is to be determined by a quantity surveyor.

NT

See section 48 ‒ similar to NSW.

If a retail shop lease contains a provision that enables the business of the tenant to be relocated, the lease is taken to include provisions to the following effect:

• the tenant's business cannot be required to be relocated unless and until the landlord has provided the tenant with details of a proposed refurbishment, redevelopment or extension sufficient to indicate a genuine proposal that:
  • is to be carried out within a reasonably practicable time after relocation of the tenant's business; and
  • cannot be carried out practicably without vacant possession of the tenant's shop;
• the tenant's business cannot be required to be relocated unless the landlord has given the tenant at least 3 months written notice (relocation notice) of relocation and the notice gives details of an alternative shop to be made available to the tenant within the retail shopping centre;
• the tenant is entitled to be offered a new lease of the alternative shop on the same terms and conditions as the existing lease, except that the term of the new lease is to be for the remainder of the term of the existing lease;
• the rent for the alternative shop is to be the same as the rent for the existing retail shop, adjusted to take into account the difference in the commercial values of the existing retail shop and the alternative shop at the time of relocation;
• if a relocation notice is given to the tenant, the tenant may terminate the lease within one month after the relocation notice is given by giving written notice of termination to the landlord, in which case the lease is terminated 3 months after the relocation notice was given, unless the parties agree that it is to terminate at some other time;
• if the tenant does not give a notice of termination as mentioned in section 48(e), the tenant is taken to have accepted the offer of a lease as mentioned in section 48(c), unless the parties have agreed to a lease on some other terms; and
• the tenant is entitled to payment by the landlord of the tenant's reasonable costs of the relocation (including but not limited to costs incurred by the tenant in dismantling and reinstalling fixtures and fittings) and legal costs in connection with the relocation.

QLD

See sections 43(1)(f), 46C-46G.

The landlord's right to relocate the tenant under sections 46D-46G is taken to be included in the lease if the lease provides for relocation of the tenant's business.

Similar to NSW in terms of notice periods, offering alternative premises and tenant's right to terminate.

The tenant is entitled to payment by the landlord for its reasonable costs of relocation under section 46G.

Section 43AD confirms that the landlord is not liable to pay compensation under section 43(1)(f) to the extent the tenant is otherwise entitled to payment of relocation costs under section 46G.

SA

See section 57. Similar to NSW however offer of new lease is on the same terms and conditions as the existing lease (excluding rent).

(The section sets out minimum entitlements of the tenant. The section does not prevent the tenant from accepting other arrangements offered by the landlord when details of relocation are being negotiated.)

TAS

See section 35. Certain provisions (in the event of a relocation clause being included in a lease) are implied in a lease. The tenant cannot be required to be relocated unless the tenant is presented with plans for refurbishment, redevelopment or extension of the shopping centre showing that:

• a genuine proposal is to be carried out within a reasonably practicable time after relocation of the tenant; and
• the proposal cannot be carried out practicably without vacant possession of the tenant's premises.

The landlord must give the tenant at least 6 months' written notice of the date for relocation including an offer of alternative premises and the terms and conditions on which they are offered.

The tenant must be compensated for actual reduction in, or loss of, profit during relocation from the point of closure to the point of opening.

The tenant can remain at the existing premises unless the tenant is satisfied that:

• the new premises are equivalent to the existing premises; or
• the tenant will be returned to his existing premises within a mutually agreed time.

The area and configuration of the new premises is to be materially the same as the existing premises unless agreed otherwise by the tenant.

The tenant may terminate the lease if alternative premises or the terms or conditions of the lease of those premises are not acceptable.

The new lease is to be on the same terms as the existing lease except as to rent which unless otherwise agreed is to be the CMR.

The landlord is to pay the tenant's reasonable costs of relocation.

Similar to NSW, the lease is to provide that the landlord is to pay the tenant’s reasonable costs of relocation.

No similar provision regarding determining reasonable amount.

VIC

See section 55. Similar to NSW.

WA

See section 14A included in the Act by the 2013 Amending Act and this section applies to New Leases (see section 13 discussion in "Minimum 5 year term of lease").

Section 14A now sets out the only relocation/ redevelopment clauses that can be contained in leases. If any of those are not utilised there is no landlord right to terminate a retail shop lease for relocation/ redevelopment.

As well as addressing the mechanics of termination and the offer of alternative premises (if the landlord wishes to offer those), section 14A puts in place 2 different compensation regimes. Which regime applies depends on whether or not the tenant has already had 5 years' possession under the current lease (or any option contained in that current lease) before the termination or not. No regard is had to prior possession under a prior lease.

The first regime applies where the tenant has had less than 5 years in occupation of the premises; the second regime applies where the tenant has been in occupation for over 5 years. The first regime is substantially more onerous and its provisions are prescribed in the Regulations.

Section 14A renders void a relocation /redevelopment provision included in a New Lease unless that provision is either:

• in the prescribed form; or
• approved by SAT under section 14A(3); or
• complies with section 14A(2) if at least 5 years of the term of the retail shop lease (including any extended period under an option to renew contained in that lease) has expired.

Section 14A(2) sets the following minimum requirements where the tenant has had more than 5 years in possession for the above purpose:

• a minimum 6 months' relocation notice must be given to the tenant by the landlord;
• the relocation notice must include details of the alternative premises;
• the tenant must be offered a new lease of those alternative premises on the same or better terms and conditions for at least the remainder of the term of the current lease and the rent is to be no more than the rent of the existing premises adjusted to take into account any difference in commercial values of the existing shop and the alternative shop at the time of the relocation; and
• the landlord must pay the tenant's reasonable costs of relocation ‒ including but not limited to:

• costs incurred by the tenant in dismantling fittings, equipment or services;
• costs incurred by the tenant in replacing, re-installing or modifying finishes, fittings or equipment or services to the standard existing in the existing retail shop immediately before the relocation (but only to the extent reasonably required to the alternative shop);
• packaging and removal costs incurred by the tenant;
• legal costs incurred by the tenant; and
• if the landlord does not offer the tenant a new lease of an alternative retail shop then the landlord is liable to pay to the tenant such reasonable compensation as is agreed in writing between the parties, or determined by WA SAT.

Under section 14A (3) WA SAT can, on application to it by the landlord (notice of which has been given to the tenant), approve a different relocation provision if WA SAT is satisfied that special circumstances exist by reason of which approval ought to be given. Given how onerous the prescribed clause is this is only, if ever, used if the parties agree more beneficial terms to the tenant than those in the prescribed clause.

Definitions and currency