Commercial leasing in South Australia is governed by the Retail and Commercial Leases Act 1995 (SA) (commenced 1 October 1995). Unlike the residential Residential Tenancies Act 1995 (which applies to almost all residential rentals), the Retail and Commercial Leases Act primarily applies to "retail shop leases" where the annual rent does not exceed a prescribed threshold.

Who Does the Act

Cover? The Retail and Commercial Leases Act 1995 applies to leases of retail shops in South Australia where the annual rent (exclusive of GST) does not exceed $420,000 (as of 1 July 2025).

A "retail shop lease" broadly covers premises used wholly or predominantly for selling goods by retail, providing services, or carrying on a business of a prescribed kind (e.g., hairdressing, restaurants, cafes).

Important Exemptions: Leases that exceed the rent threshold, leases to publicly listed companies, and some other categories are excluded from the Act's protections. If a commercial lease falls outside the scope of the Act, the relationship is governed almost entirely by general contract law and the specific terms negotiated in the lease.

Key Features of the Act

1. Minimum 5-Year Lease Term

One of the most distinctive features of the SA Act is the minimum 5-year lease term for retail shop leases (including any options to renew). This is designed to give small business tenants security to establish their operations.

Exceptions: The 5-year minimum does not apply if:

• The tenant has obtained independent legal advice and signed a certified "exclusionary clause" waiving the minimum term.
• The lease is for a term of 6 months or less.
• The lease is for certain types of short-term or seasonal use.

2. Mandatory Disclosure Statement and Guide

Before the lease is signed, the landlord must provide the prospective tenant with:

• A disclosure statement outlining all key financial terms (rent, outgoings, fit-out requirements, etc.).
• A copy of the Retail and Commercial Leasing Guide published by the Small Business Commissioner.

3. Security Bonds

Landlords can request a security bond of up to 3 months' rent (exclusive of GST). This bond must be lodged with the Small Business Commissioner within specific timeframes (7 days for the landlord, 28 days for a registered agent).

4. Dispute Resolution via SACAT

Disputes under the Act are resolved through the South Australian Civil and Administrative Tribunal (SACAT), or, for bond refund disputes, through the Magistrates Court.

5. Land Tax Prohibition

Landlords are prohibited from recovering land tax from tenants under the Retail and Commercial Leases Act. This is a significant cost that commercial landlords in SA must absorb.

Other Key Topics

• Security DepositsPreview unavailable: Bond limits, lodgement, and bank guarantees.
• Eviction ProcessPreview unavailable: Breach notices, SACAT proceedings.
• Required DisclosuresPreview unavailable: The mandatory disclosure statement and guide.
• Rent IncreasesPreview unavailable: Market reviews, CPI clauses, and excessive increase challenges.
• Lease RequirementsPreview unavailable: The 5-year minimum term and essential clauses.
• Maintenance ObligationsPreview unavailable: Structural vs. tenant repairs.
• Late FeesPreview unavailable: Interest on arrears and landlord remedies.