What Should a Landlord Do If There Is a Default on a Commercial Lease?

Posted on: 21 February 2023

A commercial lease agreement is a legally binding document that outlines the responsibilities of both the landlord and the tenant. Both parties must abide by its terms, as any failure to do so can result in legal consequences. So, what steps should the landlord take if a tenant is found to be in default of their lease agreement?

Review the Terms of the Agreement

The first step is to review the terms of the lease agreement. The agreement should clearly outline what will happen if the tenant fails to meet their obligations, such as late payments or failure to maintain the space according to contract specifications. If the tenant has broken any specific terms outlined in the agreement, it is important for the landlord to document this and provide proof if necessary.

Reach out to the Tenant

The next step is for the landlord to notify their tenant of their breach of contract and give them an opportunity to rectify it before taking further action. They may be able to negotiate a payment plan or other arrangement that works for both parties. However, if they cannot reach a resolution here, then it may be necessary for the landlord to pursue legal action through eviction proceedings or other means outlined in the lease agreement.

Get Professional Help

In many cases, landlords should enlist professional help from lawyers and real estate agents who specialize in commercial leasing agreements. They can advise landlords on how best to move forward with legal action if needed and ensure that all steps are taken correctly according to Australian law. It is important for landlords to not only protect their own interests but also act within fair and reasonable boundaries when dealing with tenants who are in default of their leases.

Take the Best Approach

No one wants to come across a client or tenant who fails to meet their obligations under a commercial lease agreement. However, there are certain steps landlords must take when this happens. For example, be familiar with the terms of the lease agreement, notify your tenant of any contract breaches and allow them to resolve any issues before pursuing legal action. In this case, you can ensure that both your and your tenant's rights are protected throughout this process.

Get Further Assistance

Don't be afraid to seek assistance from professionals who specialize in commercial leasing agreements and can also help guide you through this process if needed. But equally, don't hold back altogether, as you must look after your interests in every case.

For more information on commercial leases, contact a professional near you.


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Hello, my name is Jenny. I am happily married and have two kids. A few years ago, I started a company with my husband. At first, it was just the two of us working away from home, but as the business took off we had to think about hiring more staff. The company grew in size from 2 people to 4 people to 10 people. Once the number of staff reached double figures, I realised that I needed to make sure that I had legal paperwork and contracts in place so I could hire and fire staff if need be. We hired a lawyer to work with us so we could make sure our business was well within the law.