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Commercial Lease Agreement Template

A commercial lease agreement sets out the terms on which a business tenant leases premises from a landlord — covering rent, outgoings, permitted use, maintenance, and options to renew. Use our free Australian template to document a lease for office, warehouse, or industrial premises, with awareness of the state Retail Leases Act regime where it applies.

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COMMERCIAL LEASE AGREEMENT
Gross Lease · Victoria, Australia
LANDLORD
Harbour Property Group Pty Ltd
88 William Street, Melbourne VIC 3000 · ABN 12 345 678 901 · By: Thomas A. Reynolds, Director · +61 3 9876 5432 · leasing@harbourproperty.com.au
By: Thomas A. Reynolds, Director
TENANT
Southern Ventures Pty Ltd
45 Chapel Street, South Yarra VIC 3141 · ABN 98 765 432 109 · By: Natalie J. Wong, Chief Executive Officer · +61 412 345 678 · natalie@southernventures.com.au
By: Natalie J. Wong, Chief Executive Officer
200 Queen Street, Level 2
350 sqm · Gross Lease
This Commercial Lease Agreement ("Lease") is entered into by and between Harbour Property Group Pty Ltd (ABN 12 345 678 901) (the "Landlord") and Southern Ventures Pty Ltd (ABN 98 765 432 109) (the "Tenant"). This Lease governs a commercial tenancy not subject to residential tenancy legislation; rights and obligations arise under common law and applicable commercial tenancy legislation. The parties agree as follows:
1.
PREMISES
The Landlord hereby leases to the Tenant the commercial premises located at 200 Queen Street, Level 2, Victoria, Australia, comprising approximately 350 square metres of leasable floor area (the "Premises"). The Premises are leased as commercial premises on a Gross Lease basis. This Lease is not subject to the applicable state residential tenancy legislation.
2.
PERMITTED USE
The Tenant shall use and occupy the Premises solely for the following purpose(s): General office use, software development, and client meetings. The Tenant must not use the Premises for any other purpose without the prior written consent of the Landlord. The Tenant must comply with all applicable Commonwealth, state, and local government laws, regulations, by-laws, and codes. All licences, permits, and approvals required to conduct the Tenant's business are the Tenant's sole responsibility.
3.
LEASE TERM
The term of this Lease shall commence on 1 July 2026 and expire on 30 June 2031 (the "Term"), unless earlier terminated in accordance with this Lease. Upon expiry of the Term, unless the Tenant exercises any option to renew (if applicable) or the parties agree in writing to an extension, the Tenant must vacate and surrender possession of the Premises to the Landlord.
4.
BASE RENT AND OUTGOINGS
The Tenant shall pay to the Landlord a monthly base rent of 8,500.00 AUD plus GST (currently 10%) pursuant to the A New Tax System (Goods and Services Tax) Act 1999 (Cth). The Landlord shall issue a valid Tax Invoice for each rental period. This is a Gross Lease: all outgoings, including council rates, water rates, building insurance, and common area maintenance, are included in the base rent. The Tenant pays base rent only (plus any applicable GST).
5.
GST AND TAXES
All amounts payable by the Tenant under this Lease (including rent, outgoings contributions, and any other charges) are expressed exclusive of Goods and Services Tax (GST) unless otherwise stated. If GST is applicable, the Tenant must pay GST in addition to the amount, on receipt of a valid Tax Invoice. The Landlord represents that it is (or will be) registered for GST purposes under the A New Tax System (Goods and Services Tax) Act 1999 (Cth). Each party is responsible for its own income tax obligations. Stamp duty (if any) on this Lease is the Tenant's responsibility unless otherwise agreed.
6.
RENT REVIEW
The base rent shall be reviewed annually on each anniversary of the commencement date by reference to the Consumer Price Index (All Groups, capital city for the applicable state) published by the Australian Bureau of Statistics ("CPI"). The rent increase shall be calculated as: (CPI at review date − CPI at prior review date) ÷ CPI at prior review date × 100, applied to the preceding year's base rent. Any CPI-based increase shall be subject to any cap on rent increases prescribed by the applicable commercial tenancy legislation.
7.
SECURITY DEPOSIT
Upon execution of this Lease, the Tenant shall provide the Landlord with a cash bond in the amount of 17,000.00 AUD as security for the faithful performance of the Tenant's obligations (the "Security"). The cash bond shall be held by the Landlord as security and shall not be placed in a statutory trust account (unlike residential bonds). The bond is not governed by the residential tenancy bond legislation. The Security, less any lawful deductions, shall be returned to the Tenant within 30 days of the expiry or earlier termination of this Lease. Commercial security deposits are not subject to statutory interest obligations.
8.
FIT-OUT AND LEASEHOLD IMPROVEMENTS
The Tenant is permitted to install internal partitions, carpet, and LED lighting at its own cost, subject to Landlord approval of plans prior to commencement of works. All leasehold improvements and fit-out works must be carried out with the prior written consent of the Landlord, in accordance with any Landlord's Works specification, and in compliance with all applicable building codes, Development Consents, and local council requirements. All approved improvements become the property of the Landlord upon expiry or termination of this Lease unless otherwise agreed in writing. The Tenant shall indemnify the Landlord against any claims arising from fit-out works.
9.
MAKE-GOOD AND YIELD-UP
At the expiry or earlier termination of this Lease, the Tenant must: (a) vacate the Premises and yield up vacant possession to the Landlord; (b) remove all of the Tenant's property, goods, trade fixtures, and equipment; (c) restore the Premises to base building condition, including removal of all partitions and fit-out, with all surfaces painted in the Landlord's standard colour; (d) repair any damage caused during the make-good works; and (e) return all keys, access cards, and security devices. The Landlord may engage contractors to carry out any uncompleted make-good at the Tenant's cost if the Tenant fails to comply.
10.
MAINTENANCE AND REPAIRS
The Landlord shall maintain the structural elements of the building (including the roof, foundations, external walls, and building services common to all tenants) in good repair. The Tenant shall maintain the interior of the Premises, including all fixtures, fittings, and equipment within the Premises, in good condition and repair. The Tenant shall promptly notify the Landlord in writing of any structural deficiency. HVAC, plumbing, and electrical systems serving solely the Premises shall be the Tenant's maintenance responsibility unless this Lease specifies otherwise. The Tenant must not conduct any structural work.
11.
INSURANCE
The Tenant shall at its own cost maintain during the Term: (a) public liability insurance of not less than 20,000,000.00 AUD per occurrence, naming the Landlord as an additional insured; (b) plate glass insurance (if applicable); (c) contents and trade fixture insurance at full replacement value; and (d) workers' compensation insurance as required by law. The Tenant must provide copies of current insurance certificates of currency to the Landlord on request. The Landlord shall maintain building insurance. The Tenant's insurance shall not be cancelled or materially varied without at least 30 days' prior written notice to the Landlord.
12.
ASSIGNMENT AND SUBLETTING
The Tenant must not assign this Lease or sublet the Premises, or any part thereof, without the prior written consent of the Landlord, which shall not be unreasonably withheld or delayed. The Landlord may condition consent on the proposed assignee's financial capability and covenant strength. Any assignment does not release the Tenant from its obligations under this Lease unless the Landlord specifically agrees in writing. A change of control of the Tenant entity is deemed an assignment requiring consent.
13.
DEFAULT AND REMEDIES
The Tenant shall be in default if: (a) the Tenant fails to pay rent or any other amount due within 14 days of the due date; (b) the Tenant breaches any other material obligation under this Lease and fails to remedy the breach within 30 days of written notice from the Landlord (or such longer period as is reasonably required); (c) the Tenant becomes insolvent, enters into administration, receivership, or liquidation; or (d) the Tenant abandons the Premises. Upon default, the Landlord may terminate this Lease, re-enter the Premises, and pursue all remedies available at law or in equity. Commercial distress remedies vary by state — the Landlord should obtain legal advice regarding remedies available in Victoria. The Landlord must take reasonable steps to mitigate its loss.
14.
OPTION TO RENEW
The Tenant shall have an option to renew this Lease for a further term of 5 year(s) on the same terms and conditions (except for this option and base rent, which shall be agreed or determined at market rent). To exercise this option, the Tenant must: (a) not be in default under this Lease at the time of exercise; (b) provide written notice to the Landlord at least 6 months before expiry of the Term; and (c) have substantially complied with all obligations throughout the Term. Failing agreement on renewal rent, the rent shall be determined at fair market rent by a licensed valuer in accordance with the applicable legislation.
15.
DAMAGE, DESTRUCTION AND RENT ABATEMENT
If the Premises are damaged or destroyed by fire, storm, or other insured risk so as to render them wholly or partially unfit for the Tenant's use: (a) the Landlord shall use reasonable endeavours to reinstate the Premises within a reasonable time; (b) rent shall abate proportionally to the extent the Premises cannot be used during the period of reinstatement; and (c) if the Premises are so substantially destroyed that reinstatement is impossible or takes more than 6 months, either party may terminate this Lease by not less than 30 days' written notice. The Tenant shall have no claim against the Landlord for loss of business, profits, or other consequential damages arising from damage or destruction to the Premises.
16.
GOVERNING LAW AND JURISDICTION
This Lease is governed by and construed in accordance with the laws of Victoria and, where applicable, the laws of the Commonwealth of Australia. The parties submit to the exclusive jurisdiction of the courts of Victoria for any dispute arising under or in connection with this Lease.
17.
GENERAL PROVISIONS
Entire Agreement: This Lease constitutes the entire agreement between the parties with respect to the Premises and supersedes all prior negotiations, representations, and understandings. Amendment: No amendment is valid unless in writing and signed by both parties. Severability: If any provision is found to be invalid or unenforceable, the remaining provisions continue in full force. Notices: All notices must be in writing and served personally, by express post, or by email with acknowledgment of receipt, to the addresses specified in this Lease. Electronic Execution: This Lease may be signed electronically; electronic signatures are valid under the Electronic Transactions Act 1999 (Cth) and state equivalents. Waiver: A party's failure to exercise a right does not constitute a waiver of that right.
18.
ADDITIONAL CONDITIONS
Tenant is entitled to use of 2 allocated car park spaces in the building car park at no additional cost during the Term.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date first written above.
LANDLORD
Thomas A. Reynolds
Director
Harbour Property Group Pty Ltd
Date: ____________________
TENANT
Natalie J. Wong
Chief Executive Officer
Southern Ventures Pty Ltd
Date: ____________________

What Is a Commercial Lease?

Under Australian law, a commercial lease is a contract under which a landlord ("lessor") grants a tenant ("lessee") the right to exclusive possession of commercial premises for a fixed term, in exchange for rent. Australian commercial leases differ from residential tenancies in scope: they are generally negotiated between sophisticated parties, cover longer terms (often 3–10 years with options), and place much more responsibility on the tenant for outgoings, maintenance, and insurance.

In Australia, commercial leases over registered land are governed by the general law of contract, state Real Property Acts (for registered leases), and state Property Law Acts. Retail premises leases have an additional statutory regime: the Retail Leases Act 1994 (NSW), Retail Leases Act 2003 (Vic), Retail Shop Leases Act 1994 (Qld), Retail and Commercial Leases Act 1995 (SA), Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA), Fair Trading (Code of Practice for Retail Tenancies) Regulations 1998 (Tas), Leases (Commercial and Retail) Act 2001 (ACT), and Business Tenancies (Fair Dealings) Act 2003 (NT).

Across Australian states and territories, the state retail leases legislation imposes significant tenant protections — including mandatory disclosure statements, minimum 5-year terms (in some states), restrictions on outgoings, ratchet clause bans on rent reviews, and a tribunal forum for disputes. A lease that falls within the Australian retail leases regime cannot contract out of these protections, making correct characterisation essential.

What's Covered in This Template

Our commercial lease template covers every essential term for a business tenancy.

Parties and Guarantors

Landlord, tenant, and any personal or corporate guarantor details.

Premises Description

Street address, lettable area, and any common areas.

Term and Options

Initial term, commencement date, and any option to renew.

Base Rent

Annual rent, payment frequency, and rent review mechanism.

Outgoings

Tenant's share of council rates, water, land tax, insurance, and building management.

Permitted Use

Specific business activity permitted on the premises.

Maintenance and Repairs

Allocation of responsibility between landlord and tenant.

Alterations and Fit-out

Tenant's right to fit out and make alterations with consent.

Security Deposit / Bank Guarantee

Amount and form of security (bond or bank guarantee).

Insurance

Required public liability, plate glass, and contents insurance.

Assignment and Subletting

Conditions for assignment or sublet with landlord consent.

Make Good Clause

Tenant's obligations at the end of the lease.

How to Create a Commercial Lease

Follow these steps to produce a thorough commercial lease in minutes.

  1. 1

    Enter Party Details

    Provide landlord, tenant, and guarantor legal names, ABNs, and addresses.

  2. 2

    Describe the Premises

    Identify the address, lettable area, and permitted use.

  3. 3

    Set Rent and Outgoings

    Specify the rent, review mechanism, and share of outgoings.

  4. 4

    Add Term and Options

    State the initial term, options to renew, and security deposit.

  5. 5

    Review Retail Leases Compliance

    If retail, ensure a disclosure statement is issued and review against state legislation before signing.

Legal Considerations

Retail leases are heavily regulated; commercial (non-retail) leases offer more freedom of contract.

This template is for informational purposes only and does not constitute legal advice. For retail leases, obtain state-specific legal advice and use a disclosure statement in the prescribed form.

Reviewed for Australian law

State Retail Leases Acts

Each Australian state's Retail Leases Act protects tenants of retail shops (typically shops under 1,000 m² used for goods/services to the Australian public). Key protections include: a tenant disclosure statement before signing (sections 11 NSW, 17 Vic, 22 Qld); a minimum 5-year term inclusive of options in NSW and Victoria; a ban on ratchet clauses that prevent rent decreases; and Australian Tribunal jurisdiction (NCAT, VCAT, QCAT) for disputes under specified thresholds.

Registration at the Land Registry

Leases of more than 3 years must be registered at the state land registry under the Real Property Act 1900 (NSW), Transfer of Land Act 1958 (Vic), or equivalent to bind successors in title. Unregistered long leases may still be enforceable between the parties in equity, but priority is lost without registration.

GST and Outgoings

Most commercial leases are taxable supplies under the A New Tax System (Goods and Services Tax) Act 1999 (Cth) where the landlord is GST-registered. GST is charged on rent and on outgoings recoverable from the tenant. The lease should state whether rent is GST-inclusive or exclusive. Tenants generally claim input tax credits for GST paid.

Unfair Contract Terms

Since 9 November 2023, the unfair contract terms regime in Part 2-3 of the Australian Consumer Law applies to standard form leases with small business tenants (businesses with fewer than 100 employees or under $10m turnover). Courts can declare unfair terms void, making it essential to negotiate or moderate one-sided clauses.

Frequently Asked Questions

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