Key take outs from the new Victorian Covid-19 Lease Regulations

  • A key difference from the National Cabinet Mandatory Code is that the amount of rent relief offered by a landlord does not need to be directly related to or proportional to the reduction in the tenant’s turnover.

 

  • A tenant is only entitled to protection from termination for non-payment of rent if it makes a written request and complies with any subsequent agreement to vary the lease.

 

  • The financial position of a tenant’s business if it owns several sites is not something the Landlord has to consider. It is only the reduction in turnover at the premises of the eligible lease.

 

  • The tenant must apply individually to the landlord for each lease it holds.

 

  • The Landlord can take into account in responding to the tenant's request for relief their own circumstances for example if they have no other income other than the rent or they are highly leveraged and their lender has given no relief.

 

  • If a deferral is agreed, the tenant has the greater of 24 months or the balance of the lease term to pay the deferred rent.

 

  • If an agreement is reached ensure it is properly reflected in writing, signed by all parties including the guarantors under the lease to avoid further dispute down the track.

 

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