Make good provisions are often not well understood by business people and the clauses themselves can be ambiguously worded and inserted into the lease agreement in a hurry. Even if a make good clause doesn’t appear in the lease agreement, a landlord may be able to take common law action against you if don’t return the premises in line with its original condition.
Make a list of everything you have changed in the property. The best way to do this is to start at the front door and walk through the property in a clockwise fashion, noting everything you have changed. Once you have your list, it’s time to check with the landlord to see what they want. Sometimes an owner will see the changes you’ve made to the property as an improvement and will be happy for them to remain.
But some owners will insist on a cash settlement in lieu of make good. In fact, cash settlements are becoming more common as it often suits the departing tenant and the new tenants, who have plans to remodel the premises anyway.
Tenants can also try to negotiate a make good side deed. Side deeds can be the result of a fractious relationship between the parties and carry more risk for the departing tenant. Side deeds usually require a consultant’s report, a building condition report and itemised dispute resolution provisions.