When a commercial or industrial lease comes to an end, tenants are often required to complete what is known as a make good. This involves restoring the property to the condition it was in at the start of the lease, or to the standard set out in the agreement. Typical make good works include cleaning, repairs, repainting, and the removal of fit-outs, racking, and machinery.
Completing make good works on time is critical. If the property is not reinstated before the lease expiry date, tenants may face financial penalties and disputes with landlords. These issues can become costly and stressful, particularly when deadlines are missed. At Makegoods, we’re here to help you navigate your makegood provision.
Book a meeting with our team today.
Why tenants miss their make good deadline
There are several reasons why businesses fail to complete make good works on time. Some underestimate the scope of the project, assuming it will only require minor repairs and cleaning. Others simply run out of time, especially if they leave arrangements until the last few weeks of the lease.
Unexpected repairs can also delay the process. For example, damaged flooring or non-compliant electrical systems may require more extensive work than anticipated. Unclear lease clauses create further complications, as tenants are left unsure about what level of reinstatement is required. Finally, delays with contractors can cause projects to overrun, particularly if a business has not engaged a specialist in make good services.
While these issues are understandable, the consequences can be serious. Landlords have strong rights when works are incomplete, and tenants who fail to meet their obligations often face significant costs.
The immediate consequences of not completing make good
There are a number of consequences that can be felt immediately if you don’t complete your make good to a satisfactory degree.
Landlord arranges works at your cost
If tenants fail to carry out make good works, landlords are entitled to organise the work themselves and then recover the expenses. These costs are usually higher than if the tenant had managed the project directly, as landlords often use premium contractors and add management fees.
Loss of bond or security deposit
Another common consequence is the loss of the bond or security deposit. Landlords may retain these funds to cover the cost of reinstating the property, leaving the tenant out of pocket.
Additional rent
If make good delays prevent the landlord from re-letting the property, tenants may be charged holding rent until the site is ready. This can significantly increase costs, particularly in high-demand industrial precincts.
Legal action
In some cases, landlords may escalate the matter to formal proceedings. Legal disputes over make good obligations can result in further expenses, wasted time, and reputational damage for the tenant.
The financial and legal risks in detail
Real-world cost implications
The financial difference between tenant-managed make good works and landlord-managed works can be significant. A project that could have been completed for a set budget may end up costing far more once the landlord applies management fees, premium contractor rates, and additional charges.
How disputes can escalate
When disagreements arise, disputes may progress to courts or tribunals. These proceedings can drag on for months, costing both money and time, while preventing businesses from moving forward with their next premises.
Reputational damage for tenants
For larger businesses in particular, failing to honour make good obligations can harm professional relationships and brand reputation. Landlords may be less inclined to lease to companies with a history of disputes or unfinished make good works.
How to reduce the risk of missing deadlines
The best way to avoid these consequences is to prepare well in advance. Practical steps include:
- Start planning several months before the lease expiry date.
- Review the lease carefully and clarify your obligations early.
- Obtain professional assessments, quotes, and clear project timelines.
- Allow extra time for unexpected repairs or compliance issues.
By being proactive, tenants can reduce the risk of running out of time and ensure a smooth handover.
What to do if you can’t complete make good in time
If you realise that works will not be finished before the lease expiry, there are still steps you can take to limit the damage. These include:
- Open communication with your landlord, explaining the situation clearly.
- Negotiating an extension of time where possible.
- Providing evidence that works are underway, showing that you are meeting your obligations in good faith.
- Engaging professional contractors quickly to accelerate the project.
These measures can help reduce costs and prevent disputes from escalating further.
Why professional make good services matter
Engaging a specialist contractor can make the difference between a seamless handover and a costly dispute. Professionals have the experience and resources to manage complex projects, ensuring works are completed on time and to the required standard.
The benefits include:
- Cost efficiency through accurate scoping and project management.
- Full compliance with lease obligations and safety standards.
- Reduced stress for tenants, who can focus on their business while experts handle the works.
At Makegoods.com.au, we provide tailored make good solutions that cover everything from strip-outs and repairs to cleaning and compliance. Our goal is to ensure tenants avoid penalties and hand back their property without complications.
Book a meeting with Makegoods today
Missing your make good deadline can result in lost deposits, extra rent, legal disputes, and unnecessary costs. The risks are clear, but with careful planning and professional support, they can be avoided. If your lease is approaching its expiry date, now is the time to act.