Rent Reviews

In assessing rental value, the following documentation should be considered:

• Original lease documentation (including collateral agreements and executed documents) to be sighted where possible, otherwise the copy relied on should be executed. 

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• Confirmation of current rent and other matters as may be appropriate. ​

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• Documents relating to financial implications such as outgoings.

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• Details of the floor areas, preferably surveyed in accordance with an industry accepted method such as ANZRPGN4 Methods of Measurements, PCNZ/PINZ Guide for Measurement of Rental Areas or Property Council of Australia's 'Method of Measurement for Lettable Area.

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• If applicable, a statement from the lessor and lessee as to the extent that information obtained from the parties may be detailed within in the report. 

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• Details of the fit-out or other incentives provided by the lessor, if applicable.

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• Details of the lessors and lessee's improvements.

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Market Rent Reviews 

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• Market rent reviews in a lease enable the rental to be varied to reflect changes in the market between the date on which the lease commenced or the rent was last reviewed and the relevant review date subject to the terms and conditions of that lease.

• The fundamental starting point to any assessment of market rent, at rent review, is therefore the lease. A full understanding of the lease is required before the market rent can be assessed.

• The agreed rental review will reflect not only the market influences but also the terms and conditions in the actual lease document.

• In assessing market rent, the valuer should considered the most appropriate evidence in the market place. 

• The best evidence is generally rentals which have been agreed in comparable tenancies, at the relevant date, date with vacant possession (i.e new lettings between arm-length parties), and in particular, where the use is the same or a substantially similar use as the permitted use under the lease.

In the absence of new lettings evidence, the valuer may have to consider the following:

• Rentals agreed between arms-length parties at lease renewal or at the exercise of an option to renew an existing lease;

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• Rentals agreed at market rent reviews; and 

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• The outcome of meditations or determinations.

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Independent Determination

• In the event of a dispute between a lessor and  lessee, a valuer may be instructed or appointed to undertake an independent determination of the rental value of the premises held under the terms of an actual lease. 

• Depending on the requirements of the lease, a Valuer may be appointed to undertake an independent determination by acting as an Expert or as an Arbitrator.

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