Mount Hotham

Frequenty Asked Questions

ALPINE RESORTS LEASING POLICY FREQUENTY ASKED QUESTIONS

What are the benefits of the leasing policy?

The policy provides for a consistent approach to the leasing of land in the alpine resorts through a transparent leasing process and standard leasing documentation.

The policy also provides lessees with certain entitlements. These include two significant benefits, being the first right to negotiate a new lease prior to the expiration of the existing lease, and right to the value in the improvements on the leased land for the term of the lease. Overall, the policy aims to improve the level of certainty and security related to alpine investment.

What form of lease is to be used for a new lease?

New leases are based on the form of lease approved by the Minister for all alpine leases known as a Standard Alpine Lease. You can download a copy of the standard form of lease from the Board's website.

Is it compulsory for my club/business to transfer to a new lease?

No. There is no obligation to transfer to the Standard Alpine lease. All existing lessees have the choice of remaining on their existing lease or of surrendering their existing lease in favour of the Standard Alpine lease that provides the first right to negotiate and right to the value of the improvements on the leased land.

Can I change any of the conditions of the Standard Alpine ease?

No. The Government in approving the leasing policy stipulated that consistent lease documentation will be applied to all new leases. Changes may only be made by way of the inclusion of special conditions in the lease by the Board with the approval of the Minister. The inclusion of special conditions generally will relate to site specific requirements and may incur additional legal costs on the lessee.

My club/business would like to obtain some of the features of the new policy but retain others from its current lease. Will it be able to do this?

No. The Standard Alpine lease is available as a whole - you will not be able to 'mix and match' its features with your current lease.

Will it be possible to vary my current lease to provide for improvements to remain with the lessee?

No. The new policy provisions have been incorporated into a Standard Alpine lease. All site holders will be able to surrender a current lease and replace it with the Standard Alpine lease. You will not be able to vary a current lease to obtain this benefit.

Who will prepare the new lease and documentation associated with the transfer from my current lease to a new lease?

The Board will prepare all documentation necessary for you to transfer from your current lease to a new lease. However, this offer to prepare documents does not apply to mortgages, subleases or other property interests. This responsibility will rest with the lessee subject to acceptance of the documents by the Board.

Who will pay for the transfer from a current lease to a new lease?

It will be necessary for you to bear reasonable legal and other associated professional costs for the transfer from the lease you are on now to a new lease.

How does my club/business go about entering into a lease that embraces that provisions of this policy?

In order to transfer from your current lease to the Standard Alpine lease, you will need to surrender your current lease and enter into the Standard Alpine lease. You can commence this process by making an application to the Board.

How is my lease term determined?

The determination of lease term is subject to the proposed lessee being identified by the Board as a good lessee. A table of lease term criteria is used to assist the Board to make a determination of lease term commensurate with proposed use and investment and the level of development measured against the Strategically Identified Site Potential (SISP).

How do I determine the Strategically Identified Site Potential (SISP) of my club's/business's site? What is the existing level of development?

You should request this information from the Board. The Strategically Identified Site Potential is the maximum level of development able to be erected on the site as specified in the relevant provisions of the Alpine Resort Planning Scheme. The Board will advise you of the site's potential and the existing level of development, and will be able to discuss strategies from maximising the lease term available to you.

What do I need to do to get a 51 year lease?

The lease term criteria provides that a new or existing development to 100% of "Strategically Identified Development Potential" of the site, as identified in the Alpine Resorts Planning Scheme, would qualify for a lease term up to 51 years, subject to compliance with other specified conditions. A new development costing $8 million would also qualify for a lease of up to 51 years, subject to similar conditions.

My club/business plans to undertake works to significantly improve the premises. Does this impact on my lease?

If redevelopment or refurbishment is to occur, you may apply to the Board for a new lease in accordance with the lease term criteria. It will require that you surrender your current lease and enter into a Standard Alpine lease.

My club/business has plans to refurbish/redevelop the premises. Is it compulsory that I enter into a new lease?

No. If you plan to refurbish/redevelop and have term remaining in your existing lease there is no obligation to enter into a Standard Alpine lease. If you prefer to remain on your existing lease, then you may do so.

Will my club/business have the opportunity to enter into a Standard Alpine lease in preference to its existing lease if no refurbishment or redevelopment is proposed?

Yes. You may apply for a Standard Alpine lease to replace your existing lease without refurbishment or redevelopment plans. If you do have refurbishment or redevelopment plans or can show that you can provide additional benefit to the resort, a longer lease term will be considered.

Does my club/business need to commit to redevelopment/refurbishment of the premises to be eligible for a new lease?

No. Lease term will be determined with regard to the current or proposed level of development. For example, if a site is currently developed to 60% of its strategically identified site potential and there are no plans for refurbishment/redevelopment, a lease term of up to 35 years will be considered by the Board. If there are plans to redevelop that site to 85% of the SISP, a lease term of up to 45 years will be considered.

Can my club/business apply for a new lease at any time during the lease term?

In order to exercise the first right to negotiate under the Standard Alpine lease, an application must be made to the Board between three and four years prior to the expiry of the lease. However, if your club is undertaking improvements to the premises or providing additional benefit to the resort, you may apply to the Board for a new lease at any stage during the existing lease term.

Can my club/business be forced to undertake upgrades to the premises if the Board believes that they are necessary?

No. The Board, as lessor, will inspect the premises every three years and may made recommendations for improvements in the Building Standards Report. This report will be used as a record of the condition of the premises and will be consulted during negotiations for a new lease.

The failure to carry out the recommended improvements will not constitute a breach of the lease unless they relate to statutory provisions or planning requirements.

How does this new policy help permanent residents of the Resorts?

The lease term matrix provides that for permanent residential occupation lease terms of up to 40 years are available for a "negotiated level of development". Development levels will be negotiated with the Board taking into account the strategic objectives for the resort. It should be noted that any new lease would also contain the 'first right to negotiate' provisions.

Will my rental payments change?

Under the new lease, rentals will be determined by the Valuer General and will be influenced by movement in the value of land in the alpine resorts, so rentals may increase or decrease. If you choose to remain on your existing lease you will continue to be bound by the rent review provisions associated with that lease.

What is the advantage of the approval in principle process?

The process, which has been simplified significantly, will shorten the time taken to negotiate new leases. This is because it clearly sets out the Government's intentions and therefore gives an increased level of confidence to all parties, at an early stage, as to which proposals are likely to be given favourable consideration by the Minister.

Alpine Resorts Leasing Policy Implementation Guidelines

Lease Term Criteria

Application for New Lease or Lease Renewal