PROPERTY investors may be reeling from the dramatic fallout in commercial rents, but for lawyers in the area there is a new flow of work.
Perth commercial property lawyers are enjoying a growth in work as clients seek advice on deals they've done during the rental boom.
Mallesons Stephen Jaques commercial property partner, Laurence Iffla, says clients are approaching the firm over rent reviews and the validity of offers for commercial property rents.
As Perth suffers a downturn in the former booming mining market, which coincided with a "tremendous rise in commercial rents", there has been a fallout as demand for property slows and people look at the deals they have done.
"There has generally been a more contentious flavour to parts of the practice than there was in the past," said Iffla.
While the Mallesons partner has not looked into how this compares to other of the firm's offices, he acknowledged that Sydney probably saw it three years ago when it had "some colossal rents". Some of those cases are now working themselves out in the courts now.
"But in Perth there are some predictions being made by the market that rents will fall dramatically. Of course that means that people who have been paying higher rent are thinking 'crikey what have we done'," he said.
His comments come after new figures from Australian Property Monitors show rental growth grinding to a halt in every Australian capital city. Landlords are less likely to ask for rental increases, the figures show.
Perth property developer, Luke Saraceni, said he is optimistic about the outlook for property prices in Western Australia. He told the Australian Financial Review he predicts a return to boom conditions within three years, and that there will be a serious shortage of office space again when economic conditions improve.
Mallesons partner Iffla said that while the firm is not seeing any major deals in these rent-related deals, it is a changing area.
"Six or twelve months ago we were madly writing new leases. Now there is not so much of that and now we're spending more time with clients, saying to them 'well this person is arguing about their rent and refuses to accept this option'," he said. "It's a degree change in the practice."
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