NEWS FLASH: Covid-19 and Commercial Leases

October 6, 2020

In late May 2020, the Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Regulation 2020 (the “Regulation”) was introduced to regulate affected leases in response to the COVID-19 Pandemic.  More information about the original Regulation can be found here:

Initially, the Regulation applied during the response period that was to end on 30 September 2020.

However, on 29 September 2020, the Queensland Government introduced amendments to the Regulation by way of the Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Amendment Regulation 2020 (the “Amendment”).  Under the Amendment, the Regulation will continue throughout the extension period ending 31 December 2020.

In addition to the extension of the Regulation, there are also some changes that commercial Landlords and Tenants should familiarise themselves with. Most notably:

  • During the extension period, Landlords are not required to offer a concession that includes a rental waiver component (however a deferral of some rent remains an option); and
  • The date for taking prescribed actions of affected leases (i.e. recovery of possession; eviction, termination, etc.), which was previously 1 October 2020, has been pushed back to 1 January 2021;
  • Rent reviews can occur, but will not take effect until after the extension period ending 31 December 2020

Despite the extension period, arrangements where deferred rent is to be paid back from 1 October 2020 will continue (unless agreed otherwise).

Tenants may continue to seek further rent concession during the extension period provided they qualify for the JobKeeper 2.0 payment scheme and there are material grounds for renegotiation.

Important Notice: The information in this article is current as at 6 October 2020. It is for general purposes only and reflects a rapidly changing situation. Consequently, this article is not intended to constitute legal advice.

We are constantly reviewing and staying tuned-in to all developments within the commercial leasing area. If you need some advice or guidance, please contact us to see how we can help on 07 3392 0099.

Written by Jake Breydon, Lawyer, Wilson Lawyers.