Commercial & Retail Leases
The Power of the Parties
The relevant ‘power’ of the parties in a commercial lease should be considered when entering into such an arrangement. This is particularly applicable to small business owners who own and operate their businesses.
Landlords usually have property managers to manage their property leasing business. It relieves them of the time they need to commit to operate their ‘business of leasing’. Landlords also usually have financial capacity to engage legal professions to deal with police matters. In addition, tenants are required to pay rent even when disputes exist with landlords.
Small, owner-operated businesses, on the other hand, are usually not in the same league when it comes to legal and financial power. Additionally, owner-operators are fully engaged in the daily operations of their businesses. Time away from business activities often has a direct impact on revenues. Spare time is not something most small business owners enjoy.
Granted, the Law may govern Retail Shop Leases. However, the reality is that the relative time and financial ‘power of the parties’ is at the core of their relationships. Small business owners who are entering into lease agreements with landlords would be wise to bear in mind that the landlord is likely to have a particular ‘power’ advantage in any lease arrangement they enter into.
Need more information, talk to me.
Graham Long
Kevin Lovewell
M: 0401 308 385
E: Click here to contact Kevin Lovewell
Member & Registered Business Valuer
Australian Institute of Business Brokers
Graham Long
M: 0428 649 791
E: Click here to contact Graham Long
Member & Registered Business Valuer
Australian Institute of Business Brokers
