A "Licence to Occupy" is a way to increase utilisation and drive engagement with the growing oversupply of empty/vacant retail shops/shopping centres/offices across Australia.
This problem has been mainly caused by the COVID-19 pandemic's impact on "brick and mortar" businesses.
If so, the "Pop-up" Shop arrangement will most likely have been documented using a "Licence to Occupy".
These short-term arrangements can be beneficial to:
➲ test a business idea;
➲ take advantage of a seasonal increase in demand; or
➲ sell an excess of stock which needs a temporary storefront.
In some cases, if it works extraordinarily well, a longer-term lease can result.
For examples of how 'Licences to Occupy" have assisted in the past (originating in Newcastle, NSW) please read the book by Marcus Westbury “Creating Cities” or to simply gain an overview please watch his 2011 TEDx talk.
We have also started a new “Pop-up” Shop ➲ Smart List which will be updated over time with curated inks on this important topic.
* Whether the Short-term Retail Shop ➲ Licence to Occupy is deemed a Retail Shop Lease by your local State or Territory legislation will depend on factors such as the following:
1️⃣ The length of the licence (including an options to renew or extend); and/or
2️⃣ The length of time the licensee has already occupied the premises prior to the commencement of the Licence to Occupy.
In ACT + NSW the relevant Retail Shop Lease legislation does not apply* ➲ if the term is for less than 6 months (with no option to renew or extend) and the premises were vacant prior to the Licence to Occupy.
SA ➲ Retail Shop Lease legislation does not apply if the term is for 1 month or less.
VIC ➲ Retail Shop Lease legislation does not apply if both the term (including any option to renew or extend) and the period of continuous possession are for 1 year or less.
TAS, WA ➲ No exemption.
* In Qld + NT the relevant legislation only partially applies.
^ Note: The above provides a general overview and is no substitute for legal advice.
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