Commercial leases are often one of the most expensive commitments a business makes. The way the lease is structured — particularly the rent type and how outgoings are handled — can have a significant impact on your bottom line.
At Ensure Legal, we help tenants and landlords negotiate fair, transparent leases that protect their interests. Here’s a recent success story that demonstrates the value of having a lawyer on your side during lease negotiations.
The Client’s Challenge
A few months ago, one of our clients was negotiating a new commercial lease. Like many tenants, they were focused on the face rent but weren’t fully aware of how outgoings and area measurements could affect the total occupancy cost.
The landlord proposed a lease based on net rent, meaning the tenant would pay:
- Base rent (per square metre)
- Outgoings (land tax, council rates, insurance, cleaning, etc.)
- Adjustments if the measured floor area changed
This type of arrangement often results in fluctuating costs and can make budgeting difficult.
Our Negotiation Strategy
We pushed hard for a gross rent arrangement — where the agreed rent amount already includes outgoings and is not adjusted for area measurement changes.
This approach provided:
- Cost certainty – The tenant pays one fixed rent amount with no hidden extras.
- Protection against area remeasurements – If the space is later found to be larger, the rent doesn’t automatically go up.
- Simpler lease administration – No need to review annual outgoing reconciliations or dispute variable costs.
The Result – A 9.9% Space Bonus
The final lease was signed on gross rent terms, locking in a fixed total rent for the entire term.
Later, a new area measurement showed the space was actually 9.9% larger than originally calculated.
Because of the way we structured the lease, our client:
- Kept the extra space
- Paid no additional rent or outgoings
- Effectively received a 9.9% rental discount compared to the market
For a multi-year lease, this translates to tens of thousands of dollars saved — a clear win for the client.
Why This Matters for Tenants
Commercial lease terms are negotiable, and small clauses can have big financial consequences. Without legal advice, many tenants agree to:
- Net rent structures with unpredictable outgoing increases
- Area measurement clauses that allow landlords to remeasure and charge more rent mid-lease
- Expensive make-good obligations at the end of the term
By involving a lawyer early, you can negotiate:
- Gross rent or capped outgoings
- Clear area measurement clauses
- Reasonable make-good and renewal terms
How Ensure Legal Can Help
We act for both landlords and tenants, giving us a balanced perspective when negotiating leases. Our services include:
- Lease reviews – Identifying hidden costs before you sign
- Negotiation support – Securing favourable terms on rent, outgoings, and fit-out contributions
- Risk management – Protecting against disputes over area measurement, rent reviews, and make-good obligations
Final Thoughts
Commercial leases are more than just a monthly rent figure — they are complex legal documents with real financial impact. A well-negotiated lease can save you significant money and reduce stress over the life of the agreement.
If you are negotiating a new lease or renewing an existing one, speak with Ensure Legal to make sure your lease protects your business, not just your landlord.
