Quick answer
A landlord waiver is a signed document in which the owner of leased business premises agrees not to claim equipment or fit-out financed by a lender, and lets the lender enter to remove it if the tenant defaults. Equipment and fit-out financiers often ask for one before funding assets installed in rented premises. It may also be called a landlord's consent, access deed or landlord acknowledgement.
Key points
- The landlord acknowledges the financier's interest and gives up any claim to the financed items
- Gives the lender a right of entry to recover the assets if the loan defaults
- Matters most for fit-outs and heavy plant that could be treated as fixtures
- Landlords' solicitors can take weeks, so request it as early as possible
If you rent your premises and borrow to install something substantial inside them, two parties have an interest in the same equipment: the lender who paid for it and the landlord who owns the building it’s bolted into. A landlord waiver is the document that sorts out who gets what if things go wrong.
What the landlord agrees to
Wording differs between lenders, but most waivers cover the same ground:
- Acknowledgement: the landlord confirms the listed items belong to, or are secured to, the financier rather than forming part of the building.
- No claim: the landlord agrees not to keep, sell or claim the items, including under lease clauses about goods left behind or improvements that become the landlord’s property.
- Access: the lender may enter during a set window after default to inspect, disconnect and remove the assets.
- Make good: the lender, or the tenant, repairs damage caused by removal.
- Notice: the landlord often agrees to tell the lender if it plans to end the lease.
Why lenders want one
Two risks drive the request. The first is practical: if the business fails and the landlord changes the locks, the lender can’t get to its security without permission.
The second is legal. Equipment finance relies on a security interest registered on the PPSR under the Personal Property Securities Act. But that Act doesn’t apply to an interest in a fixture, meaning something attached so that it becomes part of the land. A commercial kitchen exhaust canopy, a cool room or a production line fixed to the slab could, in some circumstances, be argued to belong to the building. A landlord waiver takes that argument off the table by having the owner agree in writing.
A worked example
A Hobart café owner is buying an established business and wants $140k of equipment finance for a new kitchen: a combi oven, extraction canopy, cool room and coffee machine. The lender approves the deal subject to a landlord waiver covering the canopy and cool room, because both will be fixed to the building. The coffee machine and oven are portable and don’t need it.
The landlord’s managing agent passes the request to the landlord’s solicitor, who asks for a removal-damage clause and a $1,500 contribution to legal costs. The tenant agrees, the document is signed three weeks later, and the lender settles with the supplier.
Had the request gone in on the day the loan was approved instead of at the end, those three weeks would have run alongside the rest of the paperwork. Planning a fit-out? Start the finance conversation now so the landlord’s sign-off isn’t the thing holding you up.
How to keep it from delaying settlement
- Ask your lender early whether it will need a waiver, and for which assets.
- Read your lease for clauses on alterations, security interests and the landlord’s costs.
- Send the lender’s standard form to the landlord or managing agent straight away.
- If the landlord objects to specific wording, ask whether the lender will accept a variation rather than starting again.
If a dispute with a landlord stalls things, the Australian Small Business and Family Enterprise Ombudsman and state small business commissioners can point you towards help.
Related terms
Lease, lessee, lessor, chattel and general security agreement.
Fitting out leased premises?
A fit-out or new plant in a rented site comes with a few extra steps, and lenders differ in how they handle the landlord side. Give us the outline in a one-minute form. Enquiring doesn’t touch your credit score, and your details aren’t fired off to a long list of lenders. Someone experienced reads what you’ve sent and calls you to talk it through. Accurate details on the equipment, the premises and the lease term help us line up the right funder from the start.
Frequently asked questions
Does every equipment loan need a landlord waiver?
No. Lenders tend to ask when the assets are expensive, fixed in place or hard to remove, such as shop and kitchen fit-outs, cool rooms, spray booths and production lines. Portable items like vehicles and laptops rarely need one.
Can my landlord refuse?
Yes. A landlord isn't obliged to sign unless the lease says so. Some agree readily, some negotiate conditions such as make-good obligations and notice periods, and a few decline. If yours refuses, ask the lender about other security or a different structure.
Who pays the landlord's legal costs?
Usually the tenant. Many leases require the tenant to cover the landlord's reasonable costs of reviewing documents, so budget for it and ask for an estimate upfront.
What's a fixture, and why does it matter?
A fixture is an item attached to land or a building in a way that makes it part of the property. The Personal Property Securities Act doesn't apply to interests in fixtures, so a lender relying on a PPSR registration could be exposed if its equipment is later treated as part of the building. A landlord waiver helps close that gap.
Is a landlord waiver the same as a lease assignment consent?
No. A lease assignment consent is the landlord agreeing to transfer the lease to a new tenant, for example when you buy a business. A landlord waiver concerns the financier's rights over assets in the premises. Buying a business with a fit-out loan can involve both.