Leasing a commercial property to tenants can be a profitable venture, but several factors must be considered to ensure you choose the right tenants and generate the returns you want.

Based on our experience as property law professionals who help dozens of commercial property owners around Brisbane and across the state, here are seven things you should consider before leasing your premises.

Leasing your commercial property in Queensland: How to avoid stress and setbacks

1. Tenant suitability: Consider the type of occupant that would be a good fit for your property and ensure that the tenant's business aligns with zoning and licensing requirements. It may make sense to connect with an experienced commercial property manager who operates in the area and can help you identify the right occupant, rather than trying to identify the right tenant yourself.
2. Lease terms: Establish the terms of your lease upfront, including the length of the lease, rent and deposit requirements. The more detail you put into these terms, the more you and your tenant are protected from the likelihood of something going wrong. Reach out to the commercial property lawyers at NPR Law to help you create a comprehensive lease agreement that will minimise the risk of a dispute.
3. Maintenance responsibilities: When you are leasing a commercial property, it is important to clarify the responsibilities for maintenance and repairs, including who is responsible for common areas and utilities. This will help prevent a situation where both you and the tenant expect the other party to pay when something goes wrong.
4. Contract: When you create the contract with the help of your property lawyer, you should also include what’s known as a ‘make good’ clause, which will set out how the premises should be left once the property is vacated.
5. Insurance requirements: Your tenant should be able to confirm they have adequate insurance, including liability insurance and property damage coverage. Ask your lawyer about what the tenant should insure and which parts of the property should be covered by your insurance.
6. Legal compliance: As the property owner, it’s important to ensure that the building and interior are compliant with all legal requirements, including building codes, fire safety regulations and accessibility laws.
7. Rent review provisions: Establish rent review provisions to ensure that the rent remains in line with market rates and inflation. This will give your tenant peace of mind and help you plan for the future.
8. Tenant retention: Consider ways to keep your tenant for an extended period, such as offering incentives for a long-term lease agreement or mapping out a plan to upgrade the property's amenities. Throughout the tenancy, be responsive and reasonable, and attend to repairs promptly so your tenant doesn’t have any cause for complaints. As a result, you’ll be spared the expense of finding a new tenant and negotiating a new contract.

Protect yourself and your tenants

The last thing you want is a costly trip to the tribunal or the stress of an unoccupied property that is costing you money.

The work you do upfront to create a comprehensive contract when you are leasing out a commercial property in Brisbane or anywhere else in Queensland, will help ensure a successful and long-term tenancy, maximise the income your property generates and minimise the risk of disputes or legal issues down the line. Unless you have experience in this area, avoid trying to create a contract on your own, and never sign a commercial lease contract that has not been reviewed by an expert property lawyer near you who understands local rules and regulations.