What we found

Our advice months earlier had given the tenant a clear path to negotiate, with the landlord agreeing to the resulting rents. There was nothing in the evidence to support these newer increases. The mechanism was the incentive — a rent-free period or contribution that reduces what a tenant actually pays. The landlord had previously agreed 15% on one unit and 20% on the other. This time it proposed 8.33% on both. Cutting the incentive lifted the real rent in conjunction with increasing the headline figure.

On the third tenancy, the landlord sought to lift the rent from $406 to $435 per sqm. Our advice and comparable evidence showed that $370 was appropriate. A ratchet clause in the lease blocked any reduction below the passing rent.

A RATCHET CLAUSE PROTECTS THE LANDLORD FROM THE MARKET. IT DOES NOT PROTECT YOU.

As the only valuation firm working exclusively for the tenant, we had advised on both units months earlier. When their next options were exercised, we were engaged again and asked to take on the third tenancy as well. We advised at every stage, leaving the tenant to negotiate directly with the right evidence behind them, without the need for formal determination.