A commercial lease is one of the most significant commitments a business will make. And yet it’s surprisingly common for people to sign one without fully understanding what they’ve agreed to — not because they’re careless, but because leases can be long, dense, and written in a way that buries the important stuff.
Here are three things I’d flag immediately if I saw them in a commercial lease, and why they matter more than they might appear.
1. Vague or Absent Outgoings Schedules
Your rent is not your total occupancy cost. In most commercial leases, tenants are also responsible for a share of the building’s operating expenses — things like insurance, rates, maintenance, building management, and common area costs. These outgoings can add a significant amount on top of your headline rent, and if the lease doesn’t define them clearly, you may have very little visibility into what you’re actually signing up for.
A well-drafted lease will include a clear outgoings schedule that spells out exactly what is recoverable from tenants, how costs are apportioned across the building, and what (if anything) is capped. If the lease is vague on this — or worse, silent — that’s a significant problem. You could find yourself liable for costs you never budgeted for and had no way of anticipating.
Always ask for an estimate of outgoings before you sign, and make sure the lease clearly defines what’s included. If the landlord can’t or won’t provide that, treat it as a red flag.
2. Overly Complicated Review Terms and Commencement Dates
Rent review clauses and lease commencement dates sound straightforward until they’re not. I’ve seen leases where the review mechanism is so convoluted that neither party is entirely sure when reviews are triggered, what method applies, or how disputes get resolved. That ambiguity doesn’t sit quietly in a drawer — it surfaces at exactly the moment when landlord and tenant are already in disagreement.
Commencement and anniversary dates deserve the same scrutiny. If the lease term, rent-free period, and review dates aren’t all clearly aligned and easy to follow, it’s worth slowing down. A mistake in how these dates are drafted can mean reviews happen at the wrong time, or that a tenant loses the benefit of a rent-free period they thought they’d negotiated.
Good lease drafting on these points should be simple enough that both parties can read it independently and arrive at the same understanding. If that’s not the case, ask for it to be clarified before you sign.
3. It’s Not a Standard Law Association Lease
In New Zealand, the standard commercial lease is the Law Association (formerly ADLS) form. It’s widely used, well understood by lawyers on both sides, and has been refined over many years to be reasonably balanced. When someone presents a lease that isn’t based on this form, my first question is always: why?
Sometimes there’s a legitimate reason — a large institutional landlord with their own standard form, or a specialist tenancy with genuinely unusual requirements. But often, a non-standard lease is a sign that someone is trying to shift the balance of the agreement in their favour, and they’re counting on the other party not noticing.
If you’re presented with a non-standard lease, don’t just ask your lawyer to review it — ask them specifically how it differs from the Law Association form and what those differences mean for you in practice. The devil is usually in the deviations.
Get Proper Advice Before You Sign
A commercial lease is not a document to skim. The issues above are three of the more common problems I see, but every lease is different and the specifics matter. If you’re unsure about anything in a lease you’re being asked to sign, take the time to get proper legal and property advice before you commit.
We work with commercial tenants and landlords across Christchurch and are happy to talk through any concerns you have about a lease you’re looking at.
Get in touch with South Town Management — hello@southtown.nz