CPPREP4204 - CASE STUDY:

Scenario 2

A client, Jane Mathews, emails you looking to lease 60/7 Spring Ave, Springfield, which is an industrial property with a floor area of 3,215sqm. It has been listed as $90,000 PA Net + GST + Outgoings. The client wants to use it as a warehouse to store furniture goods. They would like to know if they can secure at the property at rate of 80,000 PA. They need access to toilet and shower facilities in the office.

The following information provides additional information about the property:

This heavy featured industrial facility offers a long list of quality features rare to find in today's market, these include:

• Dual freestanding facilities totaling 3,215sqm
• Situated on an 8,092sqm General Industry 'C' zoned land
• Ample onsite truck turning and large rear yard
• Dual 10t overhead cranes
• Multiple roller shutter access
• Heavy load concrete mezzanine storage
• Quality office & showroom areas across both facilities
• Open face spray booth (Approved)
• Natural Gas (Pending connection)

The landlord is open to contributing to fit out costs, additional facilities and a reduced lease amount provided that the lease is a minimum of six (6) years. The property does not have any shower facilities but has a single toilet.

Rent reviews to be conducted yearly. Bond payment of 3 months of total payable amount.

Task

1. Write an email responding to the email enquiry using the information from the case study. In your email, discuss the features of the property and explain how it would be suited the nature of their business.

2. Write an email to the client to assess if they would like to proceed with the lease.

3. The client responds back and advises you to go ahead with the lease and they would like to go for 6 year term, on the condition that the landlord covers the cost of building an toilet and one shower facility. Prepare a lease agreement using the Commercial Lease Agreement using the following details:

• 6 year term.
• 80,000 PA NET + GST
• Lessee to pay waste and water costs
• Jane Mathews of Furniture Place Ltd ACN 000 000 000 00
• Lessor to cover the costs of an additional toilet and shower.
• Landlord: Landlord Supers Pty Ltd CAN 040 000 440 00

Attach the lease agreement to this task.

4. Prepare an email explaining you have attached a copy of the prepared lease agreement and confirm the required bonds, rent reviews and financial obligations with the client. Use the information from the case study to complete this task.

5. The client emails back and requests that the toilet and shower build must be completed prior to the move in date. Revise the lease agreement with the client's and attach a copy of the revised agreement.

6. Prepare an email explaining you have attached a copy of the revised lease agreement and confirm with the client that they are happy to sign the lease.

SCHEDULE 1

1. Name and address of lessor

Mick Burrows of , Select state

1. Name and address of lessee

...... of ......

1. Address of premises

The premises is located at ......, and described more particularly as follows:

...

1. Term

The term of this Lease shall begin on ...... and shall terminate on ....

1. Options to renew

...... x ...

1. Rental - first year of term

.. plus GST

1. Lessor's outgoings payable by lessee

1. Electricity and gas

1. Lessor's insurance

1. Waste charges

1. Water charges

1. Lessee's proportion of lessor's outgoings

...

1. Insurances to be taken out by lessee

Plate glass insurance

Public risk insurance - $20,000,000.00 per claim

Lessee's property and fittings at premises

......

1. Permitted use

..

1. Guarantors

1. Security bond / bank guarantee

...... by way of ......

1. Rental reviews

13.1. Term of lease

...

Rental review date

......

Rental or review method

...

13.2. Renewed term

......

Rental review date

......

Rental or review method

...