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Usually, landlords and tenants enter into a lease intending to see it through to the end. However, your landlord may wish to sell the building that contains the premises you lease. As a tenant, your building’s sale has the potential to impact you and your business negatively. This article will outline what happens if your landlord does decide to sell your building, and provide insight into what you can do to prevent this from impacting your business. 

What Happens if My Landlord Sells My Building? 

What happens after your landlord sells your building will depend on what they have discussed with the premises’ buyer. 

If the buyer wishes to take on a filled property, they will inherit you as a tenant and become your new landlord. All of your landlord’s obligations in your lease agreement will transfer to this buyer, and your business’s operation can go unchanged. 

However, your landlord may have sold the building on the basis that it was to be unoccupied. This condition of the sale is known as ‘vacant possession’. The buyer may wish to set up a business or company in the property themselves, redevelop it or set up a new lease with a new tenant’s business. If you have an unregistered lease, you may risk losing your tenancy. Your landlord has the right to either give you a notice that they will terminate your lease in a specified period, or can choose to not renew your lease at the end of its fixed term

However, you can avoid such issues if your lease is registered.

What Is a Registered Lease?

A registered lease is a long term lease that you register under the New Zealand land title register. Short term leases – those for a term of one year or less – cannot receive registration in New Zealand. 

To register an existing lease, you need to pay a registration fee and provide a lease registration instrument. A lease registration instrument is a written or electronic document lodged to Land Information New Zealand (LINZ) by a lawyer. Such a document has to be: 

  • in writing; and 
  • signed by both the owner of the property and the tenant(s). This requirement ensures that you have prior written consent from your landlord before you register your lease. 

Lease registration instruments usually contain;

  • a description of the premises to lease; 
  • the period the registration is for; and 
  • the terms of that lease. 

New Zealand law does not legally require you to register commercial leases. However, there is a utility in doing so. 

What Are the Benefits of a Registered Lease?

As a tenant of a registered commercial lease, you gain an ‘indefeasibility of leasehold title’. ‘Indefeasibility of title’ means that the law protects the possession of your leased premises. This protection is for the duration of the registration period. 

If your landlord wishes to sell your building where you have a registered lease, they cannot terminate your lease. Instead, the new owner must honour the lease registration and take you on as a tenant. Under this new landlord, you can continue to use and enjoy the premises as you did under the prior ownership.  

Registration provides you with:

  • certainty in setting up a business at that premise;
  • maintenance of the good size or location of your business; and 
  • a continued presence and clientele base in your community.  

Key Takeaways 

When operating a business out of a leased space, it can be worrying about what would happen if your landlord decides to sell your business. If the new owner wants an empty building, you could risk losing your lease. To avoid these concerns, it is a good course of action to:

  • check to see if your lease is registered; and
  • (if not) inquire into getting a registered lease. 

Registration ensures that, should your landlord sell your building, you can continue your lease and operate your business. If you are interested in registering your lease, our experienced lawyers can help. Contact LegalVision’s property and leasing lawyers on 0800 005 570 or complete the form on this page.


What is a registered lease?

A registered lease is a long term lease that you register under the New Zealand land title register.

Why does a lease need to be registered? 

In New Zealand, there is no requirement that a lease has to be registered. However, registration ensures that the possession of the leased premises is protected by law. This protection is for the duration of the registration period. 

What if a lease agreement is not registered?

If your lease is not registered, you could risk losing your tenancy if your landlord decides to sell your building.

What is the difference between a lease and leasehold?

Leasehold is when someone else owns the land. A lease is an agreement that provides you with an exclusive right to possession of that land for a specific period.

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