Retail Leases Act 2003

A retail premises lease that provides for termination of the lease on the ground of proposed demolition of the building in which the retail premises are located is taken to provide as set out in this section.

The landlord cannot terminate the lease on that ground unless the landlord has—

provided the tenant with details of the proposed demolition that are sufficient to indicate a genuine proposal to demolish the building within a reasonably practicable time after the lease is to be terminated; and

given the tenant at least 6 months' written notice of the termination date.

If the landlord gives the tenant a notice of termination in accordance with subsection (2), the tenant may terminate the lease before the termination date by giving the landlord not less than 7 days' written notice.

If the lease is terminated by the landlord in accordance with subsection (2), or by the tenant in accordance with subsection (3), the landlord is liable to pay the tenant reasonable compensation—

if the demolition of the building is not carried out, or not carried out within a reasonably practicable time after the termination date, for damage suffered by the tenant as a consequence of the early termination of the lease; and

whether or not the demolition of the building is carried out, for the fit out of the retail premises to the extent that the fit out was not provided by the landlord.

However, the landlord is not liable to pay compensation for the damage mentioned in subsection (4)(a) if the landlord establishes that when the notice was given there was a genuine proposal to demolish the premises within a reasonably practicable time after the termination date.

The amount of the compensation is the amount that is—

agreed between the landlord and the tenant; or

if there is no agreement, determined under Part 10 (Dispute Resolution).

For the purposes of this section, demolition of the building in which retail premises are located includes any substantial repair, renovation or reconstruction of the building that cannot practicably be carried out without vacant possession of the premises.