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INSIGHTS

WHEN DOESN’T THE FIVE YEAR RULE APPLY?

By now everyone is pretty well aware that new leases need to be for a minimum of five years but there are exceptions so we thought we would point them out.
The term of a lease does not have to be a minimum of five years if:

  • the Retail and Commercial Leases Act doesn’t apply (if you want more information on this please contact our office for an info sheet)
  • the tenant is holding over from a previous tenancy that provided for up to five years
  • a certificate signed by a solicitor has been obtained
  • the tenant has been in the property for at least five years previously
  • the tenancy is a sub-lease and is for the full balance of the term left on the head lease
  • the premises have been excluded by regulations
  • the tenant is related to the lessor
  • the tenant is an incorporated association and the lease grants less than 15 hours a week occupation
    Most of these exceptions are fairly uncommon but nevertheless it is useful to know they exist.

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