Thailand property: the lease of 30+30+30 is illegal

Thailand property: the lease of 30+30+30 is illegal

 Photo Thailand property: the lease of 30+30+30 is illegal

Thailand property: The illegality of a guaranteed 30+30+30 year lease agreement

In Thailand property practice, the tenant typically pays the same rent amount for his 30 year lease contract than a property buyer. If he is well advised, he is aware that the extension or renewal option for 1 or more additional 30 year periods is unsecured and more hope than an expectation. However, it is out of question that it is legally compliant to implement such extension/renewal option clause in the lease agreement. Therefore, it make sense to implement such option, although this does not result in a binding lease obligation but is just a promise of the current lessor.

However, the legality is deeply in danger if the lease extension or renewal is economically guaranteed by the economics of the agreement. This would be the case if the lessee pays less rent for the registered lease period than for the unregistered future lease periods. As a result, a lease agreement is under current legislation (as ruled by courts in Phuket) void if the lease payments are not mainly allocated for the first thirty years, but equally to all 30+30+30 = 90 years. Illegality means that the lease is invalid starting from the first day. The registration of the lease at the land office does not change this. It remains void and illegal. even if fully prepaid.

Source and see the full article on:

PUGNATORIUS Ltd., ( is a highly accredited international law office in Bangkok, Thailand.
PUGNATORIUS Ltd. advises on foreign direct investments in Thailand, real estate developments, international tax planning and infrastructure and energy investments.
Thailand Real Estate - JFTB Phuket Property & Co - Andaman Real Estate 

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