ADLS lease considered standard

Q. Is there a standard lease? A. The Auckland District Law Society lease, referred to as the ADLS lease, is considered the industry standard and strikes a balance between matching landlord and tenant obligations. The old Building Owners and Managers’ Association, Boma lease, is now known as the Property Council lease. This is considered to be more in favour of landlords, through giving them greater control over the premises. We see this being more commonly used in retail property, because of the nature of that type of use. Other large landlords, such as Westfield or Precinct Property, have their own variation of lease which meets the needs and requirements for their particular properties. Non-standard clauses can be added to leases, together with variations on existing clauses. This would be particularly evident around areas such as rent reviews, (how this will be calculated and how often they occur), rights to renew the lease at the expiry of the initial term, the ability to assign the lease to another company or to sub lease space. It is important to fully understand the commitments and obligations when entering into a lease, as certain items can be negotiable and it is far easier to agree or change these prior to a lease being signed. Kane Goulden is a property expert with Jones Lang LaSalle, specialising in corporate solutions and tenant representation.

A. Overwhelmingly, commercial property in New Zealand will be on one of two types of leases.

The most common one is the Auckland District Law Society lease and that is probably quite widespread for small-to-medium enterprises. The other is Property Council which used to be called the Boma lease.

Both documents are pretty similar in that by and large they track through and follow the requirements of the property law act, but there are some subtle differences which a leasing lawyer should be giving you advice about. Connal Townsend is the chief executive of the Property Council New Zealand

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