WHILE last year’s introduction of the Commercial Tenancies Act has made leasing easier for small businesses, caution is still needed.
Small Business Development Corporation director enterprise development Bruce Macfarlane said the Act made conditions better for the tenant.
“Business owners should not make hasty leasing decisions. Carefully consider the lease and make sure it suits your business,” Mr Macfarlane said.
Prospective tenants need to ensure there was sufficient pedestrian traffic to make the business viable and suitable parking.
Tenants need to watch out for redevelopment clauses. Through these, a landlord can move the business to another part of a shopping centre that may not be as good.
The retail mix needs to be considered. Too many outlets selling the same products do not make for a profitable environment.
All negotiations should be conducted in writing.
Mr Macfarlane said people starting new businesses should take a short-term lease with an option for renewal if they were unsure about their future.
Businesses on long-term leases need to make sure they can make a profit.
Tenants need to keep an eye on the outgoings they are expected to pay and budget for those accordingly.
They also need to be clear on who is responsible for maintenance and repairs.
Rent review methods need to be considered. Is it based on the consumer price index or the property valuation method?
The SBDC has Leasing Business Premises: A Commercial and Practical Guide on sale for $9.90 and Common Questions about the Commercial Tenancies Act available or $5.
There is phone help available on 9220 0222.
