End Of Lease Makegood Clause

What is it?

It is one of the standard inclusions in a commercial lease, after the terms such as rent and term, it is a vague requirement for the tenant to make good the premises at the end of the term.

This is translated into the lease and usually at least requires the tenant to return the premises to the condition it was in at the commencement of the lease, remove its property and leave the premises clean and tidy.

The Problem?

It is usually a vague document, open ended and can be interpreted in almost any way by anyone, usually in favour of the author

Your Obligation?

You are required to carry out some or all of the following depending on the wording of your clause;

  • Demolish and remove all partitions, fixtures, joinery, installations.
  • Disconnect and remove all redundant power, data, lighting including cabling back to base.
  • Remove non standard floor and ceiling finishes.
  • Reinstate carpet, ceilings, services.
  • Repair any damage caused.
  • Apply to council for Complying Development Certificate.
  • Follow building rules.
  • Certify all works according to landlord requirement.
  • Complete and handover within a suitable time frame to avoid delay.
What you need to do?

If you are planning on moving without delay carry out the following steps in order;

  1. Request a scope of works from your landlord. Give them a reasonable timeframe to get back to you and ensure you get a response.
  2. Negotiate that scope down to something you consider reasonable.
  3. Put it out to the market with makegood providers ensuring that they price the scope completely and have a proven track record of carrying out makegoods.
  4. Get your prices back and compare, ensure you take special note of any exclusions and time frame required.
  5. Your landlord may provide you with a settlement figure (cost to walk away without carrying out a makegood). Its up to you which commercial decision you should make however carrying out the makegood yourself could save you up to 50% in costs.
  6. Select a provider at least a week before you need to get started to give them time to prepare.
  7. Ensure they complete on time to avoid paying unnecessary extra rent.

Note: At makegoods we guarantee that you will get your bond back if you follow our full process HERE

We can also look after your office relocation and design and construction of your new office. Then you have a single point of contact and get on with business.

How you can get stuck?

We have found through past experience that the following may occur;

  1. Tenants do not request a scope in time and do not have the time to negotiate it down.
  2. Tenants do not take the time to negotiate the scope.
  3. Tenants request makegood price from providers based on makegood clause. It is not a definitive scope.
  4. Tenants run out of time thinking they have plenty, or spend their time working on the new office and forget their obligations on their old office.
  5. Tenants do not select a suitably qualified specialist in Makegoods. A residential builder or shopfitter may not be suitable.
  6. Landlords may push for a tenant to accept a settlement figure and they may feel pressured. It is well within a tenants rights to carry a makegood out themselves.

To Find out more about the process and for any questions please call (02) 9114 6007 for advice.