Assigning a commercial lease is more straightforward than many tenants expect, but it is not simply a matter of handing the keys to the next person. The lease stays on foot, and the obligations in it follow the assignment unless the landlord and the parties agree otherwise.
When a tenant assigns a lease, they transfer their rights and obligations under it to an incoming tenant for the remainder of the term. The outgoing tenant steps away, the incoming tenant steps in, and the landlord must give consent before the assignment takes effect. How that consent process works, and what each party must provide, depends on whether the lease is a standard commercial lease or a retail shop lease under Queensland's Retail Shop Leases Act.
The Brookwater Legal team helps clients across Greater Springfield and Ipswich with commercial lease assignments, from reviewing the lease terms to managing the consent process and preparing the assignment documents.
Here is how a commercial lease assignment generally works in Queensland, and what the key differences are between retail and non-retail leases.
Key takeaways
- A landlord's consent is required before a commercial lease can be assigned.
- Retail tenants must give the incoming tenant disclosure documents at least 7 days before assignment.
- After a further assignment, the original outgoing tenant is generally released from ongoing liability.
This article is general information only and is not legal advice. Every situation is different, and you should speak with a solicitor about your own circumstances.
What does assigning a commercial lease mean in Queensland?
Assigning a commercial lease means transferring the tenant's rights and obligations under an existing lease to a new tenant for the rest of the lease term, according to the Queensland Small Business Commissioner. The original lease continues unchanged: the same rent, the same conditions, and the same expiry date. Only the identity of the tenant changes.
This is different from subletting, where the original tenant remains the leaseholder and grants the incoming party a separate right to occupy. On an assignment, the outgoing tenant exits the lease entirely, subject to the consent process and any release the landlord agrees to.
An assignment commonly arises when a business is sold, when a tenant can no longer afford the rent, or when the business needs to relocate before the lease expires. Because the lease does not end, assignment can be a cleaner outcome for a landlord than a surrender, and it avoids the outgoing tenant paying rent on empty premises.
What consent process does the landlord follow in Queensland?
Under Queensland's Property Law Act 2023, a landlord who receives a proposal to assign a lease has one month to respond once they have all the necessary details about the proposed assignment, according to the Queensland Small Business Commissioner. If the landlord takes too long to respond, or refuses without a good reason, the tenant can apply to the court.
A landlord cannot withhold consent unreasonably. Where consent is conditional, the conditions must themselves be reasonable. The Property Law Act 2023 sets out this framework for commercial leases entered into from 1 August 2025, and the Queensland Small Business Commissioner says its approach to consent now applies to all leases, whenever they were entered into.
Landlords commonly ask for financial information about the incoming tenant, their business plan, and references. A landlord may also require the outgoing tenant's guarantors to remain in place, or ask for new guarantees from the incoming tenant's directors.
Under a retail shop lease, the Queensland Small Business Commissioner notes that a landlord's costs reasonably incurred in consenting to an assignment can be charged to the tenant. Non-retail leases are governed by what the lease itself says about costs.
What documents does each party provide for a Queensland commercial lease assignment?
For all commercial leases:
- › Outgoing tenant: gives the incoming tenant a disclosure statement and a copy of the current lease at least 7 days before the earlier of the day the incoming tenant agrees to buy the business (where the assignment is connected to a business sale) or the day the landlord is asked to consent, under the Retail Shop Leases Act.
- › Incoming tenant: gives the outgoing tenant a disclosure statement before the landlord is asked to consent, and the landlord one before the assignment is entered into, under the Retail Shop Leases Act. Unless a major lessee, the incoming tenant also gives the landlord a financial advice report and a legal advice report before entering into the assignment.
- › Landlord: gives the incoming tenant a disclosure statement and a copy of the lease at least 7 days before the assignment is entered into, under the Retail Shop Leases Act.
These disclosure obligations apply specifically to retail shop leases. For non-retail commercial leases, the documents required at assignment depend on what the lease itself specifies, and a solicitor can confirm what applies.
When is the outgoing tenant released from liability after an assignment?
After a further assignment, the first outgoing tenant and their guarantors are generally released from liability for anything that happens after that further assignment, according to the Queensland Small Business Commissioner. This is an important protection: without it, an outgoing tenant could remain on the hook for a future tenant's default long after they had left the lease.
The release applies after a second assignment. It does not happen automatically at the first assignment. Until a further assignment occurs, the outgoing tenant may remain liable if the incoming tenant defaults, depending on what the lease and the consent arrangement say.
"An assignment transfers the tenant's position in the lease, but it does not automatically end the outgoing tenant's obligations. Reviewing the consent arrangement and what release the landlord agrees to is a critical step in any commercial lease assignment."
Jade Kickbusch, Principal, Brookwater Legal
How does assigning a commercial lease work in Queensland?
The process typically involves the parties exchanging information, the landlord granting consent, and the assignment deed being executed. A solicitor prepares the assignment documents and manages the consent process on the tenant's behalf.
Step 1: Talk to us
Get in touch and we will explain how the assignment process generally works and what the next steps look like for your lease.
Step 2: Review the lease and gather information
We review the existing lease to identify the consent requirements, any assignment restrictions, and what documents must be prepared and exchanged between the parties.
Step 3: Manage the consent process
We prepare and exchange the required disclosure documents, put together the consent application for the landlord, and follow up within the one-month response period the Property Law Act 2023 sets out.
Step 4: Execute the assignment deed
Once consent is granted, we prepare the assignment deed, arrange for all parties to execute it, and confirm that the incoming tenant's obligations under the lease commence from the agreed date.
| Get in touch Need help with a commercial lease assignment? We're an experienced team who keep you well informed at every stage of the process. Get in touch to discuss your needs. |
When does a retail shop lease create different assignment obligations in Queensland?
A lease is generally a retail shop lease where the shop is less than 1,000 square metres and used to carry on a retail business, or any business in a retail shopping centre, according to the Queensland Small Business Commissioner. Where the leased area exceeds 1,000 square metres, the Retail Shop Leases Act regime does not apply.
The disclosure obligations described above, including the outgoing tenant's and landlord's duty to give a disclosure statement at least 7 days before the assignment, apply specifically to retail shop leases under Queensland's Retail Shop Leases Act. For non-retail commercial leases, which are governed by Queensland's Property Law Act 2023, the lease itself sets out what must happen on an assignment.
The practical difference matters most for the incoming tenant: under a retail shop lease they receive formal disclosure before committing. Under a non-retail lease they rely on whatever the outgoing tenant and landlord provide, and on their own due diligence of the lease terms.
What does this process not cover, and what should tenants check separately?
Assignment transfers the lease, not everything connected to it. Several matters sit outside the assignment process itself and deserve separate attention.
- › Make good obligations: under Queensland's Property Law Act 2023, a tenant must return the premises in the same or better condition as at the start, excluding reasonable wear and tear, unless the lease says otherwise. These obligations pass to the incoming tenant but the outgoing tenant may remain exposed if they have already been breached.
- › Security and bonds: the lease sets out how a cash bond or bank guarantee is held and what happens on assignment. The Queensland Small Business Commissioner notes that tracing who holds a bond after a sale or assignment requires legal advice, particularly where the original arrangement was informal.
- › Options to renew: the Queensland Small Business Commissioner notes that options are not mandatory. Where the lease has an option the incoming tenant will generally step into it, but the terms of the assignment and the consent arrangement should make this clear.
- › Personal guarantees: where the incoming tenant is a company, the landlord commonly asks its directors for personal guarantees. These are negotiated at the consent stage and bind the guarantors personally if the company defaults.
Frequently Asked Questions
Can a landlord refuse consent to a commercial lease assignment in Queensland?
A landlord generally cannot withhold consent unreasonably, according to the Queensland Small Business Commissioner. If a landlord takes too long or refuses without good reason, the tenant can apply to the court.
How long does a landlord have to respond to an assignment request in Queensland?
One month from when the landlord has all necessary details about the proposed assignment, under Queensland's Property Law Act 2023, according to the Queensland Small Business Commissioner.
Does assigning a lease end all of the outgoing tenant's obligations in Queensland?
Not automatically at the first assignment. The outgoing tenant and their guarantors are generally released from ongoing liability after a further assignment, according to the Queensland Small Business Commissioner.
What is the difference between assigning and subletting a commercial lease in Queensland?
On an assignment, the outgoing tenant exits the lease and the incoming tenant steps into their position. On a sublease, the original tenant remains the leaseholder and grants the incoming party a separate right to occupy part or all of the premises.
What disclosure documents are required for assigning a retail shop lease in Queensland?
Under Queensland's Retail Shop Leases Act, the outgoing tenant and the landlord each give the incoming tenant a disclosure statement and a copy of the lease at least 7 days before the assignment, according to the Queensland Small Business Commissioner.
Do you need a solicitor to assign a commercial lease in Springfield or Ipswich QLD?
A solicitor prepares the assignment deed, manages the consent process and advises on what the lease requires. For tenants in Springfield and Ipswich, our conveyancing team can advise on commercial lease assignments from contract through to execution.
What happens to the security bond when a commercial lease is assigned in Queensland?
The lease sets out how a cash bond or bank guarantee is held and what happens on assignment, according to the Queensland Small Business Commissioner. Tracing who holds a bond after a business sale or assignment generally requires legal advice.
Your Next Steps
A commercial lease assignment in Greater Springfield and Ipswich involves the landlord's consent, the correct exchange of disclosure documents and a properly executed assignment deed. Getting the process right protects the outgoing tenant from ongoing liability and gives the incoming tenant a clean start under the lease.
Every commercial lease assignment is different, and that's exactly why it's worth a conversation. Make an appointment with the Brookwater Legal team or call (07) 3437 8555.
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External Resources
- Queensland Small Business Commissioner: Queensland's New Property Law Act
- Queensland Small Business Commissioner: Restricted Charges in Retail Leases
- Queensland Small Business Commissioner: What Is a Retail Shop Lease in Queensland
- Queensland Legislation: Retail Shop Leases Act 1994
- Business Queensland: Retail Shop Leases
Brookwater Legal · This article contains general information only and does not constitute legal advice. It does not take into account your individual circumstances. You should obtain legal advice about your own situation before acting on anything in this article. Liability limited by a scheme approved under Professional Standards Legislation.
