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Sunrise Shops - Shop 5 Lease Renewal · Report
SERVICES & ORGANISATION COMMITTEE MEETING 10 SEPTEMBER 2024
5.1 SUNRISE SHOPS - SHOP 5 LEASE RENEWAL
Author Commercial Business Advisor, Robyn Mercer
Commercial Business Services | Corporate Services Department
Index Subject 46.01 Lease
Attachments None
EXECUTIVE SUMMARY
This report seeks approval for a lease renewal of Shop 5, Sunrise Shops to the current lessee,
Australian Leisure and Hospitality Group Pty Limited. The liquor store offering is a strategically
important tenancy for Sunrise Shops, driving consistent foot traffic and maintaining a steady
customer base. This is critical to support the product mix, economic and commercial performance of
the Sunrise Shops precinct and contribute to the financial sustainability of the broader tenancy mix.
Retaining Australian Leisure and Hospitality Group Pty Limited as a tenant aligns with Council's
strategic objective to maximise commercial returns from its assets, foster a vibrant and economic
resilient retail environment and provide local community facilities.
RECOMMENDATION
That Council note the report by the Commercial Business Advisor to the Services and Organisation
Committee Meeting dated 10 September 2024 and
A. Approve the lease renewal to Australian Leisure and Hospitality Group Pty Limited for Shop
5, Sunrise Shops for three (3) years commencing 2 January 2025;
B. Authorise the Chief Executive Office to award a subsequent two (2) one (1) year extensions
of the lease subject to the lessee complying with the terms of the lease; and
C. Apply the exception to the requirement for tendering of the lease under Section 236 (1) (c)
(iii) of the Local Government Regulation 2012 as the renewal is to the existing tenant.
REPORT
Australian Leisure and Hospitality Group Pty Limited has been the lessee of Shop 5 since 2008,
consistently proving to be a valued and reliable tenant with a premium retail offering. The current
lease for Shop 5 expires on 1 January 2025. This report seeks Council approval for a lease renewal
consisting of a three (3) year base period with two (2) one (1) year extension options, commencing
on 2 January 2025.
The liquor store plays a crucial role in maintaining a consistent pattern of visitation and a stable
customer base at Sunrise Shops. Unlike other retail offerings that may experience fluctuations in
customer traffic, the liquor store benefits from regular and repeat customers. This consistency is not
only important for the tenancy itself but also positively impacts other tenancies within the precinct.
The cross-patronage that occurs as visitors engage with various retail offerings during their visit is
essential for sustaining the vibrancy of the precinct. The steady foot traffic generated by the liquor
store helps stabilise revenue streams across the precinct, contributing to the overall financial and
commercial health of Sunrise Shops.
Given the liquor store's importance in driving foot traffic, fostering cross-patronage and maintaining
a stable customer base, it is recommended that Council proceeds with the proposed lease renewal.
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SERVICES & ORGANISATION COMMITTEE MEETING 10 SEPTEMBER 2024 Link to Corporate Plan Theme No. 5 - Excellence This theme focuses on customer experience, financial sustainability, innovation and technology, levels of service, governance, our employees and volunteers, funding streams and asset management practices. Renewal of the lease aligns with a key action of the Excellence theme of Council's Corporate Plan to increase the share of operating revenue to be generated from sources other than rates or charges. Previous Council Consideration Ordinary Meeting Minutes 29 May 2014, Item 8, Page 16 That Council note the report by the Senior Property Officer, Property and Facilities to the Planning and Organisation Committee meeting dated 30 May 2014 and A. Approve the new lease agreement in the new company name of Australian Leisure and Hospitality Group Pty Limited, for 5 years commencing 2 January 2015; B. Authorise the Chief Executive Officer to award a subsequent 5 year extension of the lease subject to the lessee complying with the terms of the lease; and C. Apply the exception to the requirement for tendering of the lease under Section 236 (1) (c) (iii) of the Local Government Regulation 2012 as the renewal is to the existing tenant. Finance The proposed lease will secure ongoing revenue for Council that will be recognised in financial year budgets 2024/25 to 2029/20 and will maintain current levels of commercial yield. Under Section 236 (1) (c) (iii) of the Local Government Regulation 2012, Council is not required to tender for the leasing of a property if it is re-leasing to an existing tenant. In accordance with the requirements for this exception, Council has obtained a market value as determined by an independent valuer. Risk & Opportunities The proposed lease renewal poses minimal risk for Council as it secures ongoing tenancy of Shop 5 and provides retail continuity for the lessee and community. Human Rights Human Rights Compatibility Statement In developing this Report, the subject matter has been considered in accordance with the requirements of the Queensland Human Rights Act 2019. It is considered that the subject matter does not conflict with any human rights and supports a human rights approach to decision making by Council. Council representatives will endeavour to act and make decisions under this report in a manner that is compatible with human rights. This report should be read in conjunction with Council’s Human Rights Policy. Consultation External Consultation - Community & Stakeholder Nil.
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SERVICES & ORGANISATION COMMITTEE MEETING 10 SEPTEMBER 2024
Internal Consultation
Departments consulted:
Office of the CEO, Mayor & Community Services Corporate Services
Councillors
Mayor & Councillors Director x Director
Chief Executive Officer Community Development Financial Services
Executive Officers Sport & Active Lifestyles Fleet
Community Engagement Arts & Culture Revenue Services
People & Culture Community Connection ICT
Governance Customer Experience x Procurement
Commercial Property
Strategy & Environment Development & Regulation Infrastructure Services
Director Director Director
Strategic Land Use Planning Development Assessment Infrastructure Planning, Design
and Delivery
Economic Development & Local Laws Civil and Asset operations
Destination Management
Environmental Services Environmental Health Waste
Innovation & Digital Hub Building & Plumbing Building & Facilities
Property / Permits Disaster Management