A useful guide for valuers, landlords and tenants when dealing with retail leases
In brief: The Victorian Small Business Commission (VSBC) issued updated guidelines titled "Current Market Rent and Engaging Specialist Retail Valuers" (Guidelines). Whilst the VSBC updated the Guidelines just over a year ago, many of us were unaware of the update.
What you need to know:
- The Guidelines do not have force of law, and are not binding on valuers.
- The Guidelines are simply meant to assist valuers, landlords and tenants. As such, valuers can take into account the views expressed in the Guidelines but are not bound by them.
Background
On 1 July 2017, the Small Business Commissioner Act 2003 established the VSBC. One of the functions of the Commission was to publish guidelines about retail leases to assist the general understanding of the Retail Leases Act 2003 (Vic). The Guidelines have been published in accordance with the powers of the Commission and have been updated to include reference to the Epping Hotels Pty Ltd v Serene Hotels Pty Ltd (2015) case.
Conclusion
The Guidelines are useful reference for valuers, as they highlight a number of important decisions, of which valuers should be aware. Valuers may take into account the Guidelines and refer to them in their valuation reports, but we do not consider it obligatory to do so.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.
