Registration on the Personal Properties Securities Register (PPSR)

If you are a landlord who:

• has granted a lease to a tenant for a term of more than 2 years;
• has an interest in any chattel which is made available for the tenant’s use and which is either already in the leased premises or will be placed in the leased premises during the term of the lease (Landlord Property); and
• wants to be able to recover the Landlord Property if the tenant becomes insolvent (for example, because the chattels have a substantial value),

then it is important that you register your interest in the Landlord Property on the PPSR.

If you do not register your interest on the PPSR, then the Landlord Property may vest in the tenant’s liquidator or administrator if the tenant becomes insolvent - you may still have a contractual claim against the tenant, but it will be an unsecured claim.

Timing for registration

Ideally, registration of your interest in Landlord Property should occur within 15 business days after the date tenant takes possession of the Landlord Property. This will ensure your security interest has priority over all other interests, including over the interest of any tenant’s mortgagee.

Even if more than 15 business days have passed since the tenant has taken possession of the Landlord Property, we recommend you still register your security interest over the Landlord Property as registration prior to a tenant insolvency event will give you the best chance of preserving a priority claim to the Landlord Property.

Assignment of lease

If the tenant assigns its interest in the lease, you will need to update your registration so that the registration is against the new tenant.