A commercial property sale in Victoria isn’t as simple as finding a buyer and signing a contract. Between disclosure obligations, GST treatment, environmental checks, and new land tax reforms, the process is increasingly technical — and mistakes can be costly.

At City Pacific Lawyers, we help commercial property owners and business vendors across Melbourne and the Bayside suburbs navigate each step of the process. Here’s what you need to know to avoid legal traps and keep your sale on track.

1. Prepare a Vendor’s Statement Before Listing a Commercial Property for Sale

A Vendor’s Statement (also called a Section 32) is legally required under the Sale of Land Act for all commercial property sales in Victoria. It must be provided to the buyer before a contract is signed.

Vendor’s Statements must include:

  • Title details and ownership information
  • Any existing leases or licence agreements
  • Zoning and planning restrictions
  • Easements, covenants, and road access
  • Outgoings such as council rates, land tax and owners corporation fees
  • Details about Commercial and Industrial Property Tax (CIPT) obligations
  • The status of any statutory charges

Miss a required disclosure, and the buyer can walk away, even late in the settlement.

Hypothetical Example:

A Bayside commercial landlord overlooks lease terms and uses outdated zoning info in the Section 32. The buyer notices the issue during due diligence and withdraws before settlement. The deal collapses, and the seller has to relist the property.

2. Review GST, Contract Terms, and Special Conditions

Commercial property sales in Australia may be subject to GST — especially if the seller is registered for GST and the sale is not structured as a “going concern.” This should be clearly addressed in the contract from the outset.

Legal advice can help you:

  • Clarify GST treatment and whether special conditions apply
  • Include/exclude specific fixtures, fittings, and equipment used on the premises
  • Structure lease assignments or tenant handovers
  • Draft or negotiate due diligence conditions, FIRB approvals, or finance terms
  • Identify CGT obligations or explore rollover relief options

Standard contracts now include new rules on building reports, off-the-plan settlements, and CIPT disclosures. Review these carefully before you sign.

3. Understand CIPT and Environmental Obligations Before Settlement

Victoria is currently phasing in a new land tax for commercial and industrial property. Stamp duty is being replaced by CIPT, which is charged each year on the site’s unimproved value.

Key CIPT points for sellers:

  • If the total consideration (including GST) is below the applicable land tax threshold (currently $10.4 million), you don’t need to adjust for land tax at settlement
  • If it’s above the threshold, land tax adjustments still apply and should be addressed in the contract
  • A 10-year transition applies, with a statutory charge registered on title for unpaid CIPT — which the buyer inherits.

Environmental Factors

For some commercial sites, especially industrial or previously undeveloped land, you may need to do environmental due diligence if there’s a risk of past contamination.

Why Commercial Property Sales in Victoria Require Expert Legal Guidance

From GST and CGT treatment to disclosure obligations and new land tax rules, the commercial property sale process in Victoria is complex and ever-evolving. Failing to comply can result in cancelled contracts, tax liabilities, or legal disputes.

At City Pacific Lawyers, we provide expert, up-to-date legal support to commercial property owners across Victoria — with a strong local presence in Melbourne’s Bayside suburbs. Whether you’re selling an office, industrial facility, or mixed-use site, we’ll help you complete the sale with confidence and clarity.

Contact our commercial property lawyers today on (03) 9592 3356 or book a free consultation to protect your interests throughout your commercial property sale.