Understanding Outgoings: What Tenants and Landlords Need to Know

If you’re leasing or renting out a commercial property in Townsville, you’ll come across the term outgoings - and understanding what they are (and who pays for them) is essential for a smooth leasing experience. At iMCommercial, we believe transparency is key, so let’s break it down.

What Are Outgoings?
Outgoings refer to the costs associated with operating and maintaining a commercial property. These can include:

• Council rates
• Water and sewerage charges
• Land tax (where applicable)
• Building insurance
• Cleaning and maintenance of shared areas
• Air-conditioning servicing
• Fire safety compliance
• Security and waste removal

The specifics can vary depending on the type of property and lease agreement.

Who Pays for What?
Typically, in commercial leases, tenants pay a base rent plus a share (or all) of the outgoings. However, the arrangement depends on the lease type:

• Gross Lease: The landlord covers all outgoings, and these costs are built into the rent.
• Net Lease: The tenant pays the rent and a separate amount to cover outgoings.
• Modified Gross Lease: A hybrid model—some outgoings are included in the rent, others are billed separately.

Having a clear understanding of your lease type upfront helps avoid confusion later.

Why It Matters for Tenants
Outgoings can significantly affect your total occupancy costs. When reviewing a lease, always ask for:

• A breakdown of estimated outgoings
• A history of actual outgoing charges (where available)
• Clarity on which costs are recoverable by the landlord

Factoring these into your budgeting from the outset ensures there are no surprises down the track.

Why It Matters for Landlords
Being upfront and organised with outgoings demonstrates professionalism and builds trust. Consider:

• Providing a detailed outgoing estimate with your lease offer
• Keeping clear records for easy reconciliation
• Ensuring compliance costs (fire safety, asbestos, etc.) are accounted for and disclosed

An experienced commercial agent can help you structure your lease to ensure costs are recovered fairly and transparently.

Let’s Make It Clear and Simple
Understanding outgoings doesn’t have to be complicated. At iMCommercial, we help both tenants and landlords navigate lease terms with confidence and clarity. Whether you’re negotiating your first commercial lease or reviewing an existing one, we’re here to support you every step of the way.