Reversionary lease

A reversionary lease is a lease that does not commence until some future date.

In Australia, legislation restricts such leases. Such a lease would be void if the lease takes effect more than 21 years from the date that of the instrument.[1][2]

A reversionary lease is to be distinguished from a lease of a reversion which is when the landlord after granting a lease to lessee 1 and later grants a lease of the same property to lessee 2 for the same or different period. In such cases, lessee 2 will become the new landlord for lessee 1 (lessee 1 pay rents to lessee 2) and lessee 2 has to pay rent to the original landlord.

References

  1. ^ Hepburn, Samantha J. (2001). Principles of property law (2nd ed.). Sydney: Cavendish. p. 386. ISBN 1-876905-08-5. Referencing property law statutes: Vic, s 1453); NSW, s 120A(3); WA, s 74(3);Qld, s 102(3)
  2. ^ Law of Property Act 1925, s 149(3)


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