Summary of a DHA lease*
Term
The following summarises a lease with DHA:
- A DHA lease is up to six years in length (usually three or six year leases);
- The majority of DHA lease agreements include an option that allows DHA to renew or extend the original lease for a fixed period of one to three years; and
- The DHA lease contains a further right for DHA to vary the term of the lease by up to 12 months.
Use of property
The property will be used to accommodate:
- members of the Australian Defence Force;
- Department of Defence; and and
- other selected tenants and their families.
Rent**
The rent is determined at the start of the lease and reviewed annually, according to market valuation, by an independent registered property valuer (appointed by DHA).
Rent is paid:
- calendar monthly;
- in advance; and
- at the start of the month.
Management fee
A management/maintenance fee of 16.5% (GST inclusive) of the gross rental income applies for most leases. However, a reduced fee may be offered for leases of two years or less and properties where a strata/unit development or similar entity is responsible for exterior maintenance.
At lease end
When the lease expires DHA will ensure:
- all appliances are clean and in good working order;
- all floor and window fitting are clean; and
- the grounds and landscaping are in a neat and tidy condition.
On expiry of the lease term (where the total lease term including any option period exercised by DHA is six years or more), DHA will repaint the property internally at no extra cost to the lessor.
DHA's obligation to repaint internally at the end of a six year lease term will not be affected if DHA exercises its right to reduce the lease term by up to 12 months.
Insurance
Lessors are required to take out and maintain:
- property protection;
- public liability; and
- landlord's contents insurance.
Legal costs
Each party is to bear their own legal costs for the preparation and execution of the lease. Lessors are responsible for registration costs.
Proxy
For strata, unit, and group-title properties, the lease entitles DHA to take up a proxy to represent owners who do not wish to attend meetings.
* The lease conditions described are a general guide only to the terms ordinarily offered by DHA. A copy of DHA's standard lease document is available on request. You should read the lease carefully and seek independent legal advice. DHA may seek additional conditions or may vary its standard lease in any particular transaction.
** Rent is set at market rates and annual rent reviews are subject to market fluctuations.