Retail Make Good Requirements Explained

Key Takeaways

• Retail makes good clauses define how tenants must restore the space
• Obligations include removing fittings, fixtures, and performing repairs
• Each lease sets its own make good terms, review them early
• Compliance with Australian safety and waste laws is essential
• Smash Stripouts offers full make good and strip-out services across Sydney

What Does “Make Good” Mean in Retail Leasing?

In Australia, make good refers to the tenant’s responsibility to return a leased property to its original or agreed condition once the lease ends. This process is governed by the terms of your lease agreement, and it typically requires the tenant to remove shop fittings, fixtures, and signage and restore floors, ceilings, and walls to their initial state.

According to NSW Fair Trading, tenants must meet all obligations outlined in the lease when vacating a property. If those conditions aren’t met, the landlord may retain the bond or seek reimbursement for completing the works themselves.

A standard retail make good often involves:

• Removal of joinery, counters, and shelving
• Repair of wall damage and repainting
• Floor reinstatement or polishing
• Electrical and plumbing disconnections
• Professional waste removal and site cleaning

At Smash Stripouts, we handle all these steps under one coordinated process, ensuring your store is restored properly, safely, and on time.

Why Retail Make Good Matters?

A well-executed make good isn’t just about meeting contract conditions, it’s about protecting your reputation and avoiding costly disputes. Property managers and landlords assess the quality of make good work before releasing bonds or signing off on final inspections.

Complying with make good obligations helps you:

• Maintain a positive relationship with the landlord
• Avoid unexpected deductions or penalties
• Ensure quick bond release
• Prevent additional post-handover costs

Key Components of Retail Make Good Requirements

Retail make good clauses can vary significantly from one lease to another. However, some common components are usually included in most retail lease agreements:

• Restoration to Original Condition

Typically, the tenant is required to restore the premises to the state it was in at the start of the lease. This may involve removing alterations made to the property, such as partition walls, shelves, and lighting installations. However, some leases may allow for reasonable wear and tear, which means you won’t be held accountable for things like worn carpet or faded paint.

• Removal of Tenant’s Fixtures

If the tenant has installed any custom fixtures or fittings (e.g., signage, cabinetry, or specialised equipment), they may be required to remove them at the end of the lease. These items are often personal to the business and may not be suitable for the next tenant. However, the landlord may choose to retain certain fixtures if they have been incorporated into the structure of the building.

• Repair of Damages

Any damage caused by the tenant during the lease, whether it’s accidental or not, will generally need to be repaired. This includes holes in walls, broken windows, damaged flooring, and any other alterations that affect the structural integrity or appearance of the property.

• Cleaning

At the end of the lease, tenants must leave the premises clean and free from any rubbish or debris. This often includes professional cleaning services for carpets cleaning, windows cleaning, and bathrooms hygiene. A deep clean may be necessary to ensure the space is in good condition for the next tenant.

• Dilapidation Reports

A dilapidation report is an inspection conducted by an independent expert before the lease ends. It outlines the current condition of the property and identifies any damage or alterations made during the tenancy. This report can be used to assess the tenant’s obligations in terms of repairs and restorations.

Negotiating Make Good Clauses

When entering into a retail lease agreement, tenants and landlords have the opportunity to negotiate the terms of the make good clause. For tenants, this is an important aspect to consider, as the cost of fulfilling the make good requirements can be significant. Here are some tips for negotiating the best deal for both parties:

• Clarify the Scope of Make Good

Ensure the make good clause clearly outlines what is expected of the tenant at the end of the lease. Both parties must agree on the specific restoration and repair work required. This can avoid misunderstandings and disputes at the end of the lease term.

• Limit the Tenant’s Obligations

If possible, negotiate for limitations on the tenant’s obligations. For example, you might be able to negotiate that only major alterations (not minor cosmetic changes) need to be removed, or that certain fixtures can be left behind for the next tenant.

• Consider a Make Good Bond

Some landlords may request a make good bond up front. This is a security deposit held to cover the costs of restoring the property at the end of the lease. Tenants should consider negotiating the amount of the bond or whether it’s even necessary, especially if the make good clause is fair and manageable.

• Timeframe for Completion

It’s important to agree on a reasonable timeframe for completing the make good works. A rushed make good process can lead to subpar results. Similarly, a tenant should be allowed enough time to properly restore the premises without being penalised for delays caused by unforeseen circumstances.

• Cost Allocation

Be clear on who will bear the costs of making good work. Generally, the tenant is responsible for the cost of restoration, but some leases may allow for negotiations on how costs will be shared, especially if the premises are older or have already incurred significant wear and tear.

The Impact of Make Good on Retail Tenants

For retail tenants, the make good requirement can have significant financial implications. In some cases, the costs associated with making good can be quite high, especially if the space has been heavily customised or altered. This is why it’s crucial to fully understand the scope of the make good clause before signing a lease.

The tenant should consider:

• Cost of Repairs and Restoration: Restoring a retail space to its original condition can be expensive, especially if structural changes or expensive fixtures are involved.
• Time and Resources: The time spent on fulfilling make good obligations may impact a tenant’s ability to relocate smoothly to new premises.
• Legal Implications: Failure to comply with the make good clause can result in the landlord withholding the bond or pursuing legal action for damages.

The Impact on Landlords

For landlords, the make good clause ensures that the property is returned to a rentable condition after the tenant departs. This is especially important for maintaining the value of the property and ensuring it’s ready for the next tenant.

The landlord’s responsibilities include:

• Reasonable Expectations: The make good clause should be reasonable and fair. Expecting tenants to restore a space to a state better than when they moved in may lead to disputes or difficulty finding tenants.
• Regular Inspections: Regular inspections during the lease term can help identify potential issues early on, reducing the need for extensive make good work at the end of the lease.

Common Mistakes to Avoid

Many retail tenants underestimate how much work making good involves. Avoid these costly errors:

• Waiting until the last minute to start the process.
• Misinterpreting lease clauses.
• Hiring unqualified contractors.
• Ignoring electrical or plumbing disconnections.
• Failing to document work completion for landlord approval.

Starting early and partnering with experienced professionals like Smash Stripouts ensures you meet every requirement on time.

Benefits of Hiring a Professional Make Good Contractor

Choosing a qualified expert team provides peace of mind and proven results. With Smash Stripouts, you gain:

• Compliance: Full adherence to Australian safety and environmental laws.
• Efficiency: Quick turnarounds that minimise downtime.
• Transparency: Clear pricing and communication throughout.
• Sustainability: Waste sorted and recycled
• Tools: Access to specialised tools and equipment for safe and precise strip-outs.
• Reliability: Decades of combined expertise in retail and commercial deficits.

Preparing for a Smooth Handover

Here are a few simple steps to stay ahead of your make good obligations:

• Read your lease carefully and note all clauses about restoration.
• Schedule an early inspection to assess the current condition.
• Get written approval for any modifications or variations to the scope.
• Engage a professional team like Smash Stripouts for removal and repair.
• Request a final walk-through to confirm landlord satisfaction.

Following these steps ensures you leave the premises in top condition and your bond intact.

Conclusion

Completing retail makes good work doesn’t need to be stressful. With the right planning and a trusted team, it’s possible to meet every obligation efficiently and confidently. If your retail lease is ending soon, contact us today. Our specialists handle retail defits, make good works, and full commercial stripouts across Sydney, ensuring safety, compliance, and quality results every time.

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