Room for growth around Northbridge Plaza Shopping Centre

New Sydney CBD Retail Offering

Clearpoint is pleased to offer for lease a limited selection of new retail shops at 827-839 George Street, Sydney.

This new development is the undertaking of TAFE NSW Sydney Institute and will offer a good retail tenancy mix of food use and retail spaces, in the company of pre-commitments from a large gallery café plus a beauty salon. The property has five remaining retail shops for lease ranging from 21.5 sqm to 74.5 sqm.

The site is centrally located below TAFE NSW Sydney Institute on George Street, in one of Sydney’s busiest pedestrian hubs and moments from Central Railway and bus interchange. This new retail hub offers a range of opportunities to retailers drawing on a captive audience of students, commercial offices and a dense surrounding residential population.

For details on remaining opportunities or to arrange a viewing please call Clearpoint on 1300 325 327 or click here for property details.

Market Update Feb 2012

Time to re-think the retail mould?

Flexibility in retail layouts is the key to a successful retailer growth strategy, especially in a mature market like Australia.

Where growth is no longer driven by rapid development of new shopping centres, growth may only be possible by breaking the mould and looking at previously ignored real estate opportunities like factory outlet centres, mixed use developments, university campuses, and urban in-fills.

There are many examples of retailers that have become good at adopting flexible formats to suit local sites and conditions, such as US department stores Bloomingdale’s and Walmart.

Walmart has developed a slew of customised formats for every occasion, from 18,000 sqm freestanding supercentres at one end to 1,000 sqm edited food stores at the other. This year it also came up with a 325 sqm concept for university campuses which includes a pharmacy and licensed apparel.

For small retailers in Australia who are frozen out of shopping centres, opportunities exist for expansion both at home and overseas.

Food for thought when seeking your next investment opportunity or setting up a new retail outlet.

Drawn from “Formats Outside the Comfort Zone” by Michael Baker. Full article at Michael’s excellent blog HERE.

Assignments of Lease – Avoiding the Pitfalls

In brief

Disputes between landlords and tenants over assignment of lease can be costly but are easily avoided.

Disputes over assignments of lease

Disputes over assignments of lease can result in:

• tenants losing an opportunity to sell a business;
• landlords defending costly claims that a tenant was entitled to assign the lease without consent because the landlord unreasonably delayed consent. Costs may not follow the result if the claim is made under the Retail Leases Act through the Administrative Decisions Tribunal;  and,
• an underperforming tenant remaining in a building until the issue is resolved.

A typical assignment of lease dispute

A tenant wishes to assign its lease. The lease provides that the tenant must obtain the consent of the landlord and that the landlord must not unreasonably withhold consent.

There is a flurry of correspondence from the tenant to the landlord which tells the landlord that the tenant is going to assign the lease.

The landlord asks the tenant for financial information about the proposed assignee. Some sketchy figures are provided. The landlord asks the tenant for additional financial information about the proposed assignee. The tenant tells the landlord that the assignee must provide that information. The landlord waits for the information.

The assignee writes to the landlord requesting consent to the assignment and asking for it to be provided ‘forthwith’. The landlord responds to the tenant, again requesting the additional financial information.

The tenant writes to the landlord stating that the landlord is unreasonably withholding consent to the assignment and that the tenant is now free to assign the lease without consent. The tenant assigns the lease.

The landlord issues notices of breach of lease to the tenant. The parties end up in Court. The Court holds in favour of the landlord.

This account is based on the scenario in Tamsco Ltd v Franklins Ltd [2001] NSWSC 1205.

Three things to do to avoid this scenario

A review of the case law shows that there are three critical points when dealing with an assignment of lease. These traps are common.  They also apply, to some degree, to a tenant’s request for the landlord’s consent to the grant of a sub-lease.

1.   Following the procedure specified in the lease.
The parties must follow the procedure for assignment that is specified in the lease. It is not enough for a tenant to notify the landlord either that an assignment is going to take place or that the tenant wants to assign the lease if the lease provides that the tenant must obtain the landlord’s consent to the assignment of the lease. The landlord’s obligations to act reasonably do not arise until the tenant actually asks the landlord to consent to the assignment and does everything the lease requires the tenant to do as a precondition to assignment.

2.   The procedure must be driven by the tenant.
The tenant must make the request to the landlord for consent to the assignment. The assignee cannot make the request. The tenant must drive the procedure and only involve the assignee as necessary to obtain information about the financial status and business experience of the assignee. This is a common error.

3.   Landlord delays.
A delay by the landlord, including continued requests for information, can be deemed to be a withholding of consent. However, if points 1 and 2 have not been complied with, then the landlord’s obligations have not yet arisen and the landlord cannot then be said to have unreasonably refused consent.

Contact Catherine Hellgath, Swaab Attorneys, if you are:

• a landlord facing pressure to consent to an assignment and have not been provided with the information you have asked for
• a tenant facing a landlord who seems to be delaying consent
• a landlord and you want to refuse consent to an assignment
• need guidance about the appropriate actions to take in an assignment situation

Please contact

Catherine Hallgath, Partner, Swaab Attorneys on 02 9233 5544 or mailto: clh@swaab.com.au

Real Commercial Considerations for Retailers

Retailers in the face of limited availability of retail space for lease but increasing competition for consumer spending, face real commercial considerations when deciding whether to renew a lease or offer up a vacant retail shop in Sydney.

The expansion of national retailers and influx of international brands to Australia has buoyed up a period of slow growth in retail spending over the past few years.

However, retail trade figures are now showing  marked improvement on the back of employment growth and increased household wealth.

The strong Australian dollar, recovering sharemarket , and recent boom in the Sydney property market are all contributing factors to the growth in retail spending.

The key retail success is always finding the right location. With increased demand, and improvements in retail spending, there will always be demand for well positioned good quality retail shops for lease in Sydney.

Any retailer considering leasing shop space or renewing  an existing lease are advised to search for shops for rent in the Sydney area as a comparison, or seek expert advice on retail leasing from specialist companies such as Clearpoint – www.clearpoint.com.au

Changing the face of Lane Cove retail

Growing interest in the Lane Cove area has been highlighted by the entry of two National retailers to the Lane Cove shopping mix.

Shoe Superstore and Chemist Warehouse have both take up space on Longueville Road, with stores opening this week.

Rhys Donnellan of Clearpoint negotiated both leases.

“Chemist Warehouse with 389sqm at 73 Longueville represents one of the five major retail tenants in Lane Cove, and Shoe Superstore in 221sqm at 118 Longueville is also a significant uptake of space. The commitment to these locations by National retailers is sign of a return to confidence in the retail market as a whole.”

“The recent high density rezoning in the Lane Cove LGA is also likely to influence further investment in Lane Cove by retailers and developers, with a flow on to Lane Cove property values”.

The somewhat controversial rezoning under the NSW Government Metropolitan Strategy allows for an increase of 3,900 new dwellings in the Lane Cove LGA, and 30,000 new dwellings across the Lane Cove, Hunters Hill, Mosman, North Sydney, Ryde and Willoughby Council areas.