Commercial leasing

Lease assignment & transfer in Victoria.

When a business changes hands, the lease usually has to go with it. CMK Legal handles assignments of retail and commercial leases across Melbourne for outgoing tenants, incoming tenants and landlords, obtaining consent, preparing the deed of assignment and, where possible, releasing the outgoing tenant and their guarantors.

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Solicitor-reviewed

Deeds prepared and consent obtained by a commercial lawyer.

Fast turnaround

Aligned to your business sale settlement date.

Fixed fee, quoted first

Fixed fee for standard assignments.

Victorian leasing law

Retail Leases Act assignment process handled correctly.

What a lease assignment involves.

An assignment transfers the existing lease to a new tenant on the same terms. Nearly every lease requires the landlord's prior written consent, and the landlord is entitled to information about the incoming tenant's finances and retailing or business experience before deciding.

For retail leases, the Retail Leases Act sets out a specific process: the assignor gives the assignee a disclosure statement, the landlord is asked for consent, and consent cannot be unreasonably withheld where the statutory conditions are met.

The documentation typically includes a deed of consent to assignment, new guarantees and bank guarantee arrangements, apportionment of rent and outgoings at settlement, and a condition report where make-good is being passed on.

The critical question for an outgoing tenant is release. Without a properly drafted release, you and your guarantors can remain liable for the rest of the term even after the business is sold.

Why assignments need legal care.

Release of the outgoing tenant is not automatic

Unless the deed releases you, and unless the guarantors are released too, you can be pursued for arrears years after the sale. We negotiate release and, where the landlord resists, at least a cap or a time limit.

Consent timing drives the business sale

Most business sale contracts are conditional on landlord consent. Delay in providing financials or references can push settlement, so we run the consent process in parallel with the sale.

The incoming tenant needs to know what they are inheriting

The assignee takes the lease as it stands, including make-good, arrears history, outstanding essential safety measures and any breach notices. We review the lease and the file before your client signs.

Bond, bank guarantee and adjustments are settled properly

The bank guarantee must be replaced, the security deposit dealt with and rent and outgoings apportioned to the day. Getting this wrong leaves money sitting with the wrong party.

Talk to us about assignment if.

  • You are selling your business and the lease transfers
  • You are buying a business operating from leased premises
  • The landlord is asking for financials and references
  • You want to be released from ongoing liability
  • Guarantors need to be released or replaced
  • The lease is a retail lease under the Victorian Act
  • The landlord is refusing or delaying consent
  • A franchise or licence sits over the same premises

If a sub-lease or licence is being considered instead of an assignment, we will explain the difference, a sub-lease keeps you on the hook to the landlord, which is sometimes acceptable and sometimes exactly what you are trying to avoid.

How we run an assignment.

  1. 01

    Review the lease and sale contract

    We confirm the consent mechanism, timing obligations and any conditions attached to assignment.

  2. 02

    Request for consent

    The formal request goes to the landlord with the assignee's financial and experience information.

  3. 03

    Retail disclosure

    Where the Retail Leases Act applies, the assignor's disclosure statement is prepared and given to the assignee.

  4. 04

    Deed of consent negotiated

    We negotiate release, guarantees, security and costs in the landlord's deed rather than signing it as issued.

  5. 05

    Security and adjustments

    Bank guarantees are swapped, bonds dealt with and rent and outgoings apportioned to settlement.

  6. 06

    Settlement and handover

    The deed completes with the business sale, keys change hands and the landlord is notified.

Fixed-fee lease assignment.

Standard assignments are handled for a fixed fee covering the consent request, retail disclosure where required, negotiation of the landlord's deed and completion. Landlord costs and any registration fees are disbursements and are itemised separately.

Request a fixed-fee quote

FAQs

Lease assignment FAQs.

Still unsure? Call us on (03) 9008 7224 and speak to a lawyer, not a call centre.

Can the landlord refuse consent?
Only on limited grounds for retail leases, broadly where the assignee's financial resources or business experience are inferior, or where the statutory process has not been followed. Commercial leases usually say consent must not be unreasonably withheld, and what is reasonable depends on the drafting.
Am I released from the lease after assignment?
Not unless the deed says so. For retail leases the Act provides a release in defined circumstances where a proper assignor's disclosure statement has been given, which is one reason that step must be done correctly. Otherwise release is a matter of negotiation.
What about my personal guarantee?
Guarantees do not fall away automatically either. They must be expressly released in the deed. We always ask, and where the landlord refuses outright we push for a cap or a sunset date.
How long does landlord consent take?
Typically two to six weeks depending on the landlord and how quickly the assignee provides information. Institutional landlords and shopping centres tend to take longer, so we start early.
Is a sub-lease easier than an assignment?
Sometimes it is quicker, but you remain the tenant and remain liable to the landlord for rent and make-good. For a business sale, an assignment with a release is almost always the better outcome.
Who pays the landlord's legal costs?
Most leases make the assignor responsible for the landlord's reasonable costs of consent. We ask for those costs to be capped and to be substantiated before payment.

Related services.

Lease renewal & option exercise

Exercise your option on time and on the right terms, or renegotiate a new term.

Learn more

Make-good obligations

What you must return the premises to at the end of the term, and what you can resist.

Learn more

Retail Leases Act advice

Whether the Act applies to your premises, and what it changes for both sides.

Learn more

Transferring a lease?.

Start online or book a consultation with a CMK Legal commercial leasing solicitor in Richmond, Melbourne.

Start onlineBook a consultation