Commercial Lease or Retail Lease?

Hi guys, seeking some advice/input here.

I have a commercial property due to renew lease (residential shop top housing with business downstairs selling to buyer who wants to enter into a new lease). Can anyone enlighten as to variances on leases? Is it even legal to have commercial or residential lease on this property when in fact it is retail ie a shop?

Commercial lease - generally office type arrangements.
Retail lease - generally shops/businesses?
Residential lease - for residential premises ie the unit/flat upstairs.

It seems like the buyer wants a commercial lease but just wanted to hear thoughts on legality of this? Also if it is commercial (or even retail) will buyer pay outgoings? I know this is negotiated with previous tenant paying some rates but any thoughts here? Should we push for a retail lease? I will be getting a solicitor to draft (initial input from local solicitor was we can go ahead with this but seeking input from savvy investors given this solicitor was just local - maybe I could look into any skilled ones in this area if any recommendations?).

GST - I will be under the GST threshold for the GST/commercial portion (ie downstairs shop) so do not think this impacts as upstairs (ie residential portion) as well as other residential properties should not be included in revenue when calculating if other GST threshold of $75k.

Thanks guys!

 

Are you self managing? If not just let the property manager deal with it, that's what you pay them for.

 

Residential leases are governed by the Residential Tenancies Act, Retail leases are required for retail uses (those listed in the Retail Lease Act Schedule 1).

Leave it to the agent to decide as the two types of leases are totally incompatible ie you cannot get the outgoings under a residential lease however you may grant habitation rights under the retail lease.

 

We have a current agent so they will look after....

Interestingly on your list Scott, a dentsit/doctor is not on the retail lease schedule which is the shop we are referring to here. So far I have been advised the lease will be commercial so maybe they are right and thats why they are advising. I was a bit uncertain but maybe the professionals are right!

 

@liverpool77 - although they may not be on the schedule, if the shop form part of a group of shops then it will be a retail lease.

 

@Scott No Mates - it is a single shop plus residence only - so presumably will that make it commercial lease?

Scott/anyone have any recommendations for a solicitor whom can advise me on this in the inner west Sydney area?

 

you can also speak to your lawyer and see what they say too.. i take my advice from my lawyer cause i trust him and worked with him prior to working with my PM. so it depends on who you trust but like simon said its why you pay these people.