The March 2026 land revaluations moved two costs at once. Council rates and land tax both run off the statutory land value. On the Gold Coast, industrial land values rose 53.3 per cent. Whether that rise hits you or your tenant depends on one thing: is the lease net or gross?
Net lease
The tenant pays rent plus a share of the outgoings: rates, land tax, insurance, maintenance. When outgoings rise, the tenant pays the increase. Your net income holds.
Gross lease
The tenant pays one fixed rent. You pay the outgoings out of it. When rates and land tax rise, your net income falls until the lease ends or is renegotiated.
What a gross lease costs you in value
Take an industrial property earning $200,000 a year net on a gross lease. The revaluation adds $20,000 a year to rates and land tax. Net income drops to $180,000.
At a 6.5 per cent yield, $20,000 of lost income takes about $308,000 off the value. One rate notice, a 10 per cent fall in income and a 10 per cent fall in value.
Land tax makes it worse. The scale is progressive, so a large valuation rise pushes you into a higher band. Your land tax rises faster than the valuation behind it.
Retail is different
A net lease does not fully protect a retail landlord. Under the Retail Shop Leases Act 1994, land tax is not a recoverable outgoing for a retail shop lease, whatever the lease says. See recovering land tax under a commercial lease for the three tests.
Semi-gross leases
Many leases sit in between: the tenant pays some outgoings, often rates, and you carry the rest. Read the outgoings clause line by line. Some leases recover rates but are silent on land tax.
What to check
List each lease as net, semi-gross or gross.
For each, note which outgoings the tenant pays, and whether land tax is named.
Compare this year's outgoings budget to the new rates and land tax figures.
Note when each gross lease ends. That is your next chance to move it to net.
We review outgoings and lease terms on every property we manage. See our property management in Brisbane and on the Gold Coast.
General information only. Not legal, tax or financial advice.