Leasehold rent update
The ongoing review of State leasehold rental arrangements is a part of the review of the Land Regulation 1995 required under the provisions of the Statutory Instruments Act 1992 (Qld). The regulation specifies the rental arrangements for State land such as:
- the grouping of leases according to categories of land use
- the rental percentage rates applicable to each category
- the provisions regarding minimum rents and the payment of rent generally, including during times of financial hardship.
The review process is lengthy because of its complexity; more than 23 000 tenure holders in 10 categories of land use are affected. Since 2005–06, pending finalisation of the review, rents for leaseholders in category one have been calculated against pre-2004 land values in recognition of the effect of prolonged drought on some smaller pastoral enterprises.
New capping provisions
Following extensive consultation, the government has announced its intention to cap future increases in Category 1 rents at 20 per cent per annum for 10 years, commencing 2007–08.
Example
For a lease that has an unimproved value of $1 million as at 1 July 2007, the calculated rent would be:
$1,000,000 X 1.5% = $15 000
However, because of the 'freeze', the previous year's rent of $2200 was based on the pre-2004 land valuation, which was $275 000, and calculated using the concessionary percentage rate of 0.8%.
As this is an increase in excess of 20%, the new rent will be capped at 20%:
$2200 x 1.2 = $2640
Accordingly, the rent payable on the 2007-08 invoice will be $2640 and until 2017 this rent will be capped at no more than 20% above the preceeding years rent.
Who else is affected?
The new capping arrangements will also apply to charitable and non-commercial community organisations, including sporting and recreation clubs (i.e. lessees, licensees and permittees in Categories 6 and 10), pending finalisation of revised rental arrangements more suited to community uses of State land, which is publicly owned.
Future action
A review of the rural capping arrangements will not occur until 2011, and any resultant rental arrangements will not take effect until 2017–18.
Further information
For more information the department has developed the following fact sheet:
For further enquiries and requests for additional information email State Land Management.
Alternatively enquiries can be directed to your nearest business centre.
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Last updated: 31 August 2009
Last reviewed: 16 November 2009