7 April 2020

Commercial Leasing – Navigating the COVID-19/Coronavirus Pandemic

Jacob Duane
Jacob Duane Commercial Property Lawyer

We are seeing unprecedented activity in the commercial leasing industry due to the COVID-19 pandemic. Currently, we are assisting our clients to negotiate rent reductions in exchange for monthly calls on bank guarantees and extension to lease terms.

How long this will last is anyone’s guess as the Prime Minister’s media statement on 3 April 2020 stated that a mandatory code was to be legislated by the states and it would include a prohibition “on landlords from making a claim to a bank guarantee or security deposit for non-payment of rent”. There are other proposed prohibitions contained in the media statement.

Generally speaking, communication between landlords and tenants has been admirable. There are some tenants that are refusing to communicate with landlords. Those tenants are being issued with notices to remedy breach of lease.

Although they cannot be acted on, it will serve as a record of the breach and the tenants’ refusal to work in a fair and reasonable manner.

The Property Council of Australia yesterday issued a COVID-19 Brief. In that brief, the PCA hinted at the possibility of the National Cabinet adopting a principle “allowing tenants to walk away from their leases en masse”. That would be devastating for the commercial leasing industry.

Landlords and tenants need to communicate now to ensure that all parties are able to continue to trade and meet their obligations during these difficult times.

“The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.” Winston Churchill.

Jacob Duane, Bill Purcell and Dan Ronan would be happy to discuss how you can work with your landlord or tenant on achieving a result that works for all parties involved in your commercial leasing arrangement.


Individual liability limited by a scheme approved under professional standards legislation (personal injury work exempted).

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