These tips are relevant for a Retail Shop Lease and a Commercial Lease. Our lawyers (solicitors) advise on on Retail Shop Leases and Commercial Leases Queensland wide.
Bond / Bank Guarantee / Security Deposit
Usual commercial practice sees landlords requiring a bond / security deposit from the tenant of 1 – 6 months rent.
The bond is usually provided by way of a Bank Guarantee. A Bank Guarantee is issued by the tenant’s bank in favour of the landlord and is an unconditional order to pay when it is presented by the landlord to the bank. The tenant gets no say about whether the bank pays out on it or not. Your bank will charge a fee to issue the bank guarantee, an annual fee to maintain it and will usually require some security.
A landlord will usually ask for and insist on personal guarantees from the directors and possibly shareholders of the tenant company. Take care before agreeing to these as liability under them can arise years later when you thought the lease was all done and dusted. Consider offering a larger band rather than giving personal guarantees.
Lease legal advice
Need help? Our Property Law and Leasing team (of lawyers / solicitors) now offers a fixed fee High Point Lease Review and advice conference (in person or by phone) for leasing Queensland wide. This can be done same day if needed. Contact us now for a fixed fee quote.