The landlords succeeded: the Tribunal declared that the specialist retail valuer's market rent determination failed to comply with s 37 of the Retail Leases Act 2003 (Vic) and set it aside as not binding on the parties. While the Tribunal was satisfied the valuer considered all mandatory matters under s 37(2) — including permitted use, the adjoining common property sublease, incentives, future rent review provisions, and advertised tenancies — the determination was vitiated because the valuer failed to provide 'detailed reasons' as required by s 37(6), particularly in explaining how the effective rental rate of $425/m² per annum was derived from comparable evidence ranging from $212–$602/m² (with the two most comparable properties at $363 and $390/m²). The case confirms that a valuer must do more than recite the statutory considerations and 'leap to judgment'; the determination must disclose the steps of reasoning connecting the comparable evidence and identified factors to the ultimate figure, even if the minutiae of every subjective assessment need not be set out. The question of what incentive was applied and how the benefit of the adjoining sublease influenced the rate were left unexplained, rendering the reasoning opaque.
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