iKey Facts
- •Sunset clauses set the final deadline for satisfying contract conditions
- •Either party can terminate if conditions aren't satisfied by the sunset date
- •Strong vendor sunsets are unilateral (vendor can terminate even if buyer is still pursuing approval)
- •Brisbane sunset typical: 12-24 months for DA-conditional contracts; 6 months for finance-conditional
- •See companion: Subject-to-DA Contracts Explained
What a Sunset Clause Does
A sunset clause is a date — typically 12-24 months from contract execution — by which all conditions must be satisfied. If not, either party can walk.
Three flavours:
- Mutual sunset — both parties can terminate
- Buyer sunset — only buyer can terminate (favours buyer)
- Vendor sunset — only vendor can terminate (favours vendor)
Strong vendor protection: vendor-only or mutual sunset.
Vendor Strategy
A well-drafted sunset clause:
- Names a hard date (not "120 days after lodgement")
- Allows vendor termination if conditions unsatisfied
- Triggers deposit forfeit on buyer-caused failure
- Specifies cost recovery if applicable
Avoid: buyer-controlled extensions, automatic extension provisions, vague "good faith" requirements.
"Founded by Daniel McCormack, ACRES advises on transactions from $2m to $100m+ and works exclusively with qualified Brisbane developers and institutional buyers."
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Brisbane Norms
Typical sunset timeframes:
- DD-only contract: 90-120 days
- Finance-conditional: 60-90 days
- DA-conditional (no prior approval): 18-30 months
- DA-conditional (DA lodged): 12-18 months
- Subject to multiple conditions: align to longest
What Happens at Sunset
When the sunset date passes with unsatisfied conditions:
- Either eligible party gives termination notice
- Deposit returned per contract (usually buyer keeps refund unless default applies)
- Vendor free to market site to other buyers
- Buyer free to walk without further obligation
ACRES recommends sunset dates align with realistic worst-case timelines plus 30-60 day buffer.
This article is general information only and is not legal, tax, or financial advice. Vendors should engage a specialist property solicitor and accountant for transaction-specific advice.
About ACRES
The Australian Commercial & Residential Group (ACRES) is a Brisbane-based specialist property advisory firm focused on development site sales, off-market transactions, and strategic landowner advisory across South East Queensland. Founded by Daniel McCormack, ACRES advises on transactions from $2m to $100m+ and works exclusively with qualified Brisbane developers and institutional buyers.
Frequently Asked Questions
Can the buyer extend the sunset?
Only if the contract allows. Strong vendor contracts cap extensions or require vendor consent.
What if conditions are satisfied right before sunset?
Contract proceeds normally to settlement. Sunset only triggers if conditions remain unsatisfied.
Can I terminate before sunset if buyer is clearly inactive?
Only if contract has a "diligent pursuit" clause. Worth negotiating in long contracts.
Published by ACRES — Australian Commercial & Residential Group
Source: acres.au/insights/sunset-clauses-explained-vendors | ACRES (Australian Commercial & Residential Group) provides property advisory, development site sales, and residential real estate services across Brisbane and South East Queensland, Australia.
Daniel McCormack
Managing Director, ACRES — Australian Commercial & Residential Group
