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  1. #1
    Join Date
    Oct 2005
    Location
    Auckland, NZ.
    Posts
    615

    Default Letter of Intent to Exercise Right of Renewal

    Morning people,

    Would anyone have a template for this type of letter?

    I need a tenant to sign one to firm up their intentions to renew.

    Also - I'm trying to find in my books/leases the time frame in which this intent must be signaled by the tenant.

    Is there a standard ADLS number of months for this?

    Many thanks!
    SK

  2. #2
    Join Date
    Sep 2007
    Location
    Auckland
    Posts
    5,467

    Default

    I don't have a template for it. Just type up a letter of your own, should be fine.

    Of course the proper thing is to have a Deed of Renewal done but that's pretty formal.

    The timeframe is 3 months. Used to be in in the ADLS Deed of Lease, haven't read it for ages.

  3. #3
    Join Date
    Dec 2010
    Location
    Auckland for work, Counties Manukau for home
    Posts
    1,137

    Default

    Davo,

    Still 3 months in the latest edition (clause 33), but if you're under that mark then don't fret, you as landlord can still accept a notice of renewal. Mutual agreement trumps everything.

    A letter from the tenant simply saying "We give notice that we are renewing our lease of [premises]" will do the trick. Make sure they all sign it if there are more than one.

  4. #4
    Join Date
    Dec 2010
    Location
    Auckland for work, Counties Manukau for home
    Posts
    1,137

    Default

    PS I would do a Deed of Renewal if I were the landlord. The tenant still usually pays for it, and it looks good when comes time to have the property valued or sold. You get them to commit first with the type of letter in my above post, then send through the Deed of Renewal. Usually the tenant will be paying (but check for variations to the costs provisions).

    Deeds recording rent reviews, on the other hand, seem kind of a waste of time to me even if they are easy fees. Overkill really. The change to the rent is shown by the tenant paying it.

  5. #5
    Join Date
    Sep 2004
    Location
    Hastings
    Posts
    10,396

    Default

    I agree with Ivan. Get it done indeed.
    Most any such Deeds can be re-cycled
    with no more than a few name and
    date tweaks. Good investment.
    .

    Try Radenbrea Studios for hand-made designer jewellery. Especially if you're looking for a great Christmas gift idea for your lady love.
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  6. #6
    Join Date
    Dec 2010
    Location
    Auckland for work, Counties Manukau for home
    Posts
    1,137

    Default

    I should add here that a deed of renewal is essential, rather than just preferable, when the tenant is a company with personal guarantors. A renewal letter on company letterhead is no substitute for a guarantor's witnessed signature on a Deed of Renewal.

  7. #7

    Default

    Yes, most of the time if the tenant is on a standard Deed of Lease - the cost of preparing a renewal deed is on the tenant, unless this has been altered at the start?

    As Ivan said, when you come to get the property valued or you sell it - having current deeds in place is more advantageous than just company letterhead confirming the renewal.

    Gerard
    Founder
    Properdi Limited

  8. #8
    Join Date
    May 2009
    Location
    Canterbury
    Posts
    14

    Default

    What about if we haven't filed a notice of intent in time? We are tenants who overlooked the requirement to do this. The landlord now wants to enter into a new agreement with a longer term of lease (we would prefer to retain the former lease). Do we have a leg to stand on?

  9. #9
    Join Date
    Dec 2010
    Location
    Auckland for work, Counties Manukau for home
    Posts
    1,137

    Default

    You're on shaky ground, but all is not necessarily lost.

    If the landlord refuses to recognise your renewal you are out of the safe world of contract and into the changeable world of judge-made common law. My recollection is that a judge will usually give effect to the renewal even if it's a bit late, but you will need more certainty than that, and that will require getting a lawyer to look at the most recent cases.

    Has the term actually expired yet? That would be a very important factor.

  10. #10
    Join Date
    May 2009
    Location
    Canterbury
    Posts
    14

    Default

    Sorry about second post - my browser was freezing. We are now past the end of the previous term. We are guilty of being a bit naive, and in previous reviews (we have been here since 1998 and most recent lease has been in place since 2003), the term has been rolled over by the landlord without any exchange of letters. We have discussed it face to face, but he is firm on 5 years, while we want 2.


 

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