What is a deed of variation of a lease?

A short formal document that changes specific terms of an existing lease while everything else stays as it was. It records exactly what changed, from when, and confirms the rest of the lease continues. It is signed by the landlord, the tenant, and usually any guarantor.

Can we just agree lease changes by email instead?

It is risky. Most leases say variations must be made formally in writing, and an email chain rarely covers everything a change actually touches. Informal variations are one of the most common sources of lease disputes, usually years later when the people who agreed the change have moved on.

Does a deed of variation need to be registered?

If the lease itself is registered on the title, a variation generally should be registered too, otherwise the registered lease no longer matches what the parties are actually doing. Whether registration is needed and how it is done varies by state, so check before you sign rather than after.

Can varying a lease release a guarantor or bank guarantee?

Yes. A guarantee can stop protecting the landlord if the lease is materially varied without the guarantor agreeing to the change. Bank guarantees can have the same problem where the amount or the lease they secure has changed. Any deed of variation should deal with both expressly.

Deed of Variation of a Commercial Lease: When You Need One

Businesses change faster than leases do. Rent gets renegotiated, terms get extended, the use of the premises shifts. A deed of variation is how those changes are made properly, and skipping it is how small agreements turn into big disputes.

A lease is a long document that both sides live with for years. Sooner or later something needs adjusting, and the question becomes how to record the change. The answer, almost always, is a deed of variation: a short formal document that changes the specific terms you have agreed to change and confirms everything else stays exactly as it was.

When you need one

Any time the parties agree to change something the lease itself governs. The common ones:

Rent changes. A negotiated reduction, a rent-free period, or a different review method going forward.
More time. Extending the term, or adding an option to renew that was not there before.
A different use. Widening or changing the permitted use so the business can do something the lease did not originally allow.
Money mechanics. Changing how outgoings are shared, the security amount, or who pays for what.
Practical changes. Signage rights, trading hours, assignment conditions, and the dozens of small terms that stop matching reality as a business grows.

The handshake variation is where disputes are born. Most leases say changes must be made formally, in writing. An email saying "no worries, pay the lower amount for now" feels fine on the day. Years later, with new owners, a new agent, or a sale of the building, nobody agrees on what was actually varied, for how long, or whether it was binding at all.

Why a deed, specifically

Two reasons. First, most leases require it: informal changes may simply not be effective under the lease's own terms. Second, a deed is binding without anything being given in return. Plenty of lease changes benefit only one side, like a rent reduction, and recording them as a deed puts the change beyond argument.

A good deed of variation is short. It names the lease, sets out only the clauses being changed, says when the changes take effect, and confirms the rest of the lease continues untouched. If a guarantor exists, they sign too. That last part matters more than most people realise.

The trap: when a change becomes a whole new lease

Some changes are too big to be variations. Extending the term of the lease itself, or adding extra premises, can be treated at law as a surrender of the old lease and the grant of a brand new one, even though the document on the table says "variation" at the top. That matters because a new lease can mean:

fresh disclosure obligations under retail lease legislation, with real consequences for skipping them,
new registration requirements on the title,
security and guarantees tied to the old lease quietly falling away.

None of this makes the change impossible. It just means some changes need to be structured deliberately, sometimes as a new lease done properly, rather than squeezed into a two-page variation.

If you are the landlord

A variation that is not done carefully can cost you the protections you spent the original negotiation getting. A personal guarantee can stop protecting you if the lease is materially varied without the guarantor consenting to the change. A bank guarantee for the old rent amount may be too small for the new deal. And if the lease is registered, a variation that never gets registered leaves the title telling a different story from the documents. Every deed of variation should deal with the guarantor, the security, and registration expressly.

If you are the tenant

Get the change recorded while everyone is still friendly. The rent concession your landlord happily agreed to over the phone is worth very little if the building sells and the new owner's first move is to check what the lease actually says. If you have a guarantor, remember a variation needs their signature too, and think before agreeing to changes that increase what they are on the hook for.

The short version

If the lease is changing, document it with a deed of variation signed by everyone, including guarantors. If the change is big, check first whether it is really a variation at all, because term extensions and extra premises can amount to a new lease with new obligations. Either way, ten minutes of doing it properly now is cheaper than a dispute about what was agreed later.

Deed of variation: changing a lease properly