Make Good Provisions in Leases

If you are a landlord or renter of a commercial property, there are several different clauses that you will need to consider carefully in your commercial lease agreement. One of the key clauses in your commercial lease agreement is the ‘make good’ clause, but what is that, exactly? We explore this clause and how to honour it below.

What is a make good provision?

During the lease term, tenants can make changes to a property. Once a lease has ended, tenants may be required to pay a financial settlement if they do not return the property to its original state.

A commercial make good clause is a term of a lease that requires the tenant to return the premises to the condition that it was in when the lease began. This provision places an obligation on the tenant to undo any renovations made or repair any damage done to the premises before the lease term ends. In commercial leases in New Zealand, make good clauses aren’t automatic. If you wish to include a make good clause in your lease agreement, you must expressly draft it in. What this make good clause requires is determined by negotiations between a landlord and potential tenants.

Landlords should be specific and clear as to what expectations they have of the extent of the make good clause. This ensures that the tenant hands back the premises in the appropriate condition. As part of the make good, tenants are usually required to remove their property from the space and leave the area clean and tidy. Further obligations may include:

  • Repairing any damage caused while you occupied the property
  • Removing (or reinstating) all partitions, fixtures, joinery, installations, flooring, and ceiling finishes
  • Removing installed intertenancy walls, floor finishes and the ceiling and returning all base building air conditioning, fire, and hydraulic services back to an open floor plan.

Why should you hire a professional?

Returning a space to its pre-lease conditions can be a massive project to undertake, which is why it’s best left to professionals. As a tenant, it can be hard to keep on top of your end of lease obligations. Having professional help can ensure that you keep tight control of costs associated with dilapidation works rather than allowing the landlord to do it and make sure that everything is complete in time for the end of the lease to avoid consequential fees.

Need to make good? Get in touch with VSB!

Here at VSB, we’re Auckland’s only specialist provider of commercial make good services. Whether you’re a tenant preparing to move out, or a landlord preparing to remarket your space so that it looks fresh and new, our expert team can help. We can also work closely with your Dilapidation Consultants to ensure we’re covering all the requirements in your lease agreement.

Our team of specialists enable outgoing tenants to return the property to the landlord in compliance with your agreed schedule of dilapidations as set out in the terms of your lease. VSB also ensures that the make good clause is achieved in a timely and cost-efficient manner. Get in touch with us today to learn more.

Get in touch!

If you need commercial refurbishment works in Auckland, you need VSB Property Services. Get in touch with us today for a no-obligation discussion on the best solutions for your project!

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