The main types of commercial leases include gross leases, net leases (single, double, or triple), percentage leases (based on sales), and modified gross leases. Each type allocates costs differently between landlords and tenants.
Commercial rent is typically calculated per square meter (or square foot) annually. For example, a 100 sqm space at $200/sqm/year would cost $20,000 annually.
A fit-out refers to the customisation or renovation of a commercial space to suit a tenant’s needs. This could include interior design, flooring, partitions, or specialised equipment installation.
This depends on the lease type. In a triple-net lease, tenants cover maintenance, while in a gross lease, the landlord typically handles maintenance costs.
Breaking a lease early can lead to penalties such as forfeiting a deposit, covering lost rent, or paying a lease-breaking fee. Always check your lease terms for early termination clauses.
This depends on the lease type. In a triple-net lease, tenants cover maintenance, while in a gross lease, the landlord typically handles maintenance costs.
Subleasing depends on your lease agreement. Many leases allow subleasing with landlord approval, but the original tenant often remains responsible for the lease obligations.
The notice period is outlined in your lease agreement and is typically 30-90 days before the end of the lease term.
A rent review clause allows the landlord to adjust the rent periodically, often based on market rates or inflation indexes.
Yes, landlords may offer incentives such as rent-free periods, fit-out contributions, or reduced initial rent to attract tenants, especially in competitive markets
Tenants typically need liability insurance, contents insurance, and sometimes specific coverage required by the landlord, such as building insurance contributions.
You can find commercial properties through real estate websites, commercial brokers, auctions, or local property networks.
Due diligence involves verifying the property’s condition, title, zoning, financial performance (for leased properties), and compliance with regulations to minimise risks.
Deposits typically range from 10% to 30% of the purchase price, depending on the lender and the type of property.
Commercial properties often offer higher rental yields, longer leases, and potential tax advantages compared to residential investments.
Options include commercial mortgages, private funding, or leveraging equity from other properties. Speak with a financial advisor to explore your options.
A tenant covenant refers to the tenant’s financial strength and reliability, indicating their ability to fulfill lease obligations.
Zoning laws dictate permissible uses for the property, such as retail, industrial, or office use. Ensure the property aligns with your intended purpose.
Common mistakes include overpaying, neglecting due diligence, misunderstanding zoning restrictions, and underestimating ongoing maintenance costs.
Yes, but you’ll need to comply with local zoning laws, building regulations, and potentially obtain consents or permits.
Absolutely. A commercial property lawyer can help review contracts, ensure compliance with regulations, and protect your interests during the transaction.
Steps include property valuation, preparing the property for sale, marketing, negotiating offers, and closing the sale. Working with a broker can streamline the process.
Effective marketing strategies include professional photography, online listings, targeted advertising, direct outreach to potential buyers, and using a commercial real estate broker.
Capital gains tax applies to the profit made from selling a property. The rate depends on your country’s tax laws and the length of time you’ve owned the property.
Consider market conditions, property performance, interest rates, and your financial goals. Selling in a strong market can maximise returns.
Yes, selling with tenants in place can make the property more attractive to investors, as it provides immediate rental income.
An off-market sale is when a property is sold without being publicly listed, often to a private buyer or investor. This can reduce marketing costs and maintain discretion.
In many cases, GST applies to commercial property sales. However, certain exemptions, such as the sale of a going concern, may apply. Consult a tax advisor for clarity.
Enhance the property’s value by improving tenant quality, upgrading facilities, reducing vacancies, and ensuring the property is well-maintained.
Yield measures the annual return on investment as a percentage of the property’s value. It’s a key factor buyers use to evaluate investment potential.
The choice depends on market conditions and your property’s appeal. Auctions create urgency, while traditional listings allow for broader buyer engagement.
Freehold means you own the property outright, while leasehold means you own the building but lease the land it sits on.
Valuation methods include income-based approaches (capitalization rate), comparable sales analysis, and replacement cost analysis.
Higher interest rates increase borrowing costs, which can lower property values and reduce investor demand. Conversely, lower rates often boost investment.
Strata-titled properties are divided into individual units owned separately, while shared areas are managed collectively, often through a body corporate.
Risks include market volatility, tenant defaults, prolonged vacancies, and unexpected maintenance costs.
Look for areas with high foot traffic, strong demographics, economic growth, and accessibility to transportation and amenities.
Consider installing energy-efficient lighting, solar panels, water-saving devices, and green building certifications to attract eco-conscious tenants.
ROI = (Net Profit / Total Investment) x 100. Include rental income, operating expenses, and appreciation in your calculations.
Key documents include leases, title deeds, financial statements, zoning certificates, and building inspection reports.
Yes, but foreign buyers may need approval under the Overseas Investment Act (OIA) for certain transactions. Consult a lawyer for guidance.
