The words in your lease, explained.

General information only, not legal advice. These are common plain-English meanings. Your lease may define a term differently, and the lease definition is the one that counts.

Jump to: Lease and legal terms · Building and fit-out terms · Strip-out and works terms · Quotes and contracts · Safety, licences and approvals · Industrial and retail terms · Money and security · Disputes · MAKE GREAT terms

Lease and legal terms

Make good

The tenant's obligation, written in the lease, to hand the premises back in a stated condition at the end of the lease. The NSW Small Business Commission describes that condition as the premises as first built, as at the start of the lease, or another condition the lease specifies. Also spelt make-good, makegood or making good. See what is make good?

Make-good clause

The part of the lease that sets out the make-good obligation. It is often read together with the alterations clause, the definitions and the yield-up clause. See your make-good clause explained.

Reinstatement

Putting back what the landlord originally provided, such as ceiling tiles, standard light fittings, carpet or air-conditioning outlets, after you removed or changed them. Usually one part of a make good. See lease reinstatement.

Restoration

Returning something to an earlier stated condition. It has no fixed meaning in Australian leases, so check how your lease uses it. See make good vs reinstatement vs restoration.

Original condition

The condition of the premises at a stated earlier time, usually when the lease started or when the premises were first built. Without a condition report or photos it can be hard to prove what the original condition was.

Yield up clause

The clause that says how you must give the premises back ("yield up") at the end of the lease, for example "in good repair and condition, clean and free of rubbish". It often sits next to, or forms part of, the make-good clause.

Fair wear and tear

The ordinary ageing of premises from normal, reasonable use, such as faded paint or worn carpet in walkways. Many make-good clauses exclude it, but only if the lease says so. Damage, such as holes from removed fixtures, is not fair wear and tear.

Alterations clause

The clause that controls changes you make to the premises during the lease, usually requiring the landlord's written consent. Consent is often given on conditions, such as removing the alterations at the end of the lease.

Landlord's consent

The landlord's written approval for alterations or fit-out works. Keep every consent letter: conditions attached to consent often decide what must be removed at lease end. In Tabcorp v Bowen (2009), the High Court let a landlord recover the cost of reinstatement, not just the drop in value, after a tenant made a substantial alteration without consent.

Holding over

Staying in the premises after the fixed term has ended. The NSW Small Business Commission says leases often let a tenant hold over month to month, and that either party can then end the lease with one month's notice. If your make good is not finished by the end date, you may need the landlord's agreement to stay on, and you may pay rent for that time.

Lease expiry

The date the lease ends by its terms. Make-good works usually have to be finished, and the premises handed back, by this date unless the landlord agrees otherwise.

Assignment

Transferring your lease to someone else, often when a business is sold. The person taking the lease usually takes on its make-good obligations too. The Victorian Small Business Commission says a tenant who buys a business and takes the existing lease still has make-good obligations.

Retail lease

A lease covered by a state retail leases law, such as the Retail Leases Act 2003 (Vic) or the Retail Leases Act 1994 (NSW). Retail leases have extra rules on disclosure, security deposits and disputes. In Victoria, the Act does not apply where occupancy costs are more than $1,000,000 a year (excluding GST), among other exclusions (Source: Retail Leases Regulations 2023 (Vic) reg 6(1)). See the legal and leases FAQs.

Disclosure statement

A document a landlord must give a prospective retail tenant before the lease is signed: at least 14 days before in Victoria, and at least 7 days before in NSW. The Victorian form includes the question "Are you required to make good the premises at the end of the lease?"

Schedule of condition

A record of the premises' condition at a point in time, usually at the start of the lease, with photos and notes. It is often the most useful evidence of what "original condition" means for your premises.

Condition report

Another name for a schedule of condition. Victoria's Retail Leases Act 2003 does not require one, but both the Victorian and NSW Small Business Commissions recommend one at the start of a lease, signed by both parties.

Dilapidations

A mainly UK term for a tenant's breaches of repair and reinstatement obligations at lease end, and the landlord's claim for them. Some Australian landlords and surveyors use it to mean make-good items.

Schedule of dilapidations

A list prepared for the landlord, often by a building surveyor, of the make-good works the landlord says the tenant must do or pay for. Check every item against your lease. A schedule is a claim, not a decision.

Scott schedule

A table used in disputes where each disputed item is listed in a row, with columns for each side's position, cost and comments. It helps narrow down which make-good items are actually in dispute.

Breach notice

A formal notice from the landlord saying you have broken a lease term. In Victoria, before a landlord can re-enter or forfeit a lease for breach, the Property Law Act 1958 requires a notice that states the breach and asks for it to be fixed if possible. Deadlines often run from a notice, so act quickly.

Building and fit-out terms

Base building

The landlord's building and the standard services and finishes the landlord provides before any tenant fit-out, such as structure, lifts, toilets, main air-conditioning plant, fire services and sometimes ceilings and lighting. There is no single legal definition, so check your lease and any base-building specification.

Base building services

The landlord's building-wide systems: main power supply, air-conditioning plant and ductwork, fire sprinklers and detectors, hydraulic (water and sewer) services and lifts. Tenants usually must not alter them without consent, and must reverse any changes at the end of the lease.

Fit-out

Everything added to make the premises suit a particular tenant: offices, partitions, kitchens, joinery, floor coverings, lighting, data cabling, signage and furniture. Who paid for it does not decide who removes it; the lease does.

CAT A (Category A) fit-out

A basic, ready-to-fit-out standard, mostly used for offices: typically suspended ceilings, standard lighting, air-conditioning distribution, raised floors or floor finishes, and finished walls. The term comes from the UK, and its meaning varies between buildings, so check your lease. Some make-good clauses require you to return the space to CAT A.

CAT B (Category B) fit-out

The tenant's own fit-out installed on top of CAT A: offices, meeting rooms, kitchens, joinery, feature lighting, furniture and branding. At lease end, CAT B is usually what has to come out.

Cold shell

A space handed back with very little: often bare floor, no ceiling and services capped at set points. The NSW Small Business Commission notes that cold or warm shell terms are sometimes used in shopping centres, where they can mean taking services back to capped points and installing hoarding.

Warm shell

A space handed back with some base services in working order, such as power, lighting and air conditioning, ready for a new tenant's fit-out. Exact meaning varies, so check your lease.

Bare shell

Premises stripped back to the building structure with tenant items removed. Often used in retail and in shopping centres. Some leases use "bare shell", "cold shell" and "base building" loosely, so confirm what each one means for you.

Suspended ceiling

A ceiling hung below the concrete slab on a metal grid, with removable ceiling tiles. Common in offices. A make good often requires replacing damaged or stained tiles and reinstating grid you removed.

Partitions

Internal walls that divide space, such as plasterboard stud walls, glass partitions or demountable systems. Removing them usually leaves damage to ceilings, floors and walls that also has to be repaired.

Raised access floor

A floor of removable panels raised above the concrete slab, with cabling underneath. If you installed it, you may have to remove it; if it is part of the base building, you may have to repair damaged panels.

Floor boxes

Power and data outlets set into the floor. When removed, the hole or cut-out usually has to be patched to match the surrounding floor.

Data cabling

Network and phone cabling. Many leases require tenants to remove all redundant cabling, including above the ceiling and in risers, which can be a large hidden job.

Comms room

A room housing network equipment, often with extra cooling, power and fire suppression. Its equipment and dedicated air conditioning usually have to be removed at lease end.

Supplementary air conditioning

Extra air-conditioning units installed by the tenant, such as for a comms room or meeting room. Removal usually needs a licensed technician and the related electrical and drainage work capped off.

HVAC

Heating, ventilation and air conditioning. In a make good, it usually means reinstating ceiling outlets (diffusers) and ductwork to the base-building layout after partitions are removed.

Strip-out and works terms

Strip-out

Removing a tenant's fit-out from the premises: partitions, ceilings, joinery, floor coverings, services and fixtures. Strip-out is often the first stage of a make good. See commercial strip-out.

Soft strip

Removing non-structural items only, such as furniture, carpet, ceiling tiles, joinery and fittings, without touching the building structure.

Internal demolition

Removing internal built elements, such as partitions, mezzanines or bulkheads. Depending on the work and the building, it may need permits and, in Victoria, building work includes demolition.

Make safe

Disconnecting and capping off services you added, such as power circuits, water lines and gas, so they are safe and ready for the next tenant. Electrical make-safe work needs a licensed electrician.

Capped services

Services such as power, water or data that have been disconnected and sealed at an agreed point, usually where they leave the base-building system.

Patch and paint

Filling holes and cracks in walls and ceilings, then repainting. Often the minimum make-good item even where little else is required. Check whether your lease requires full repainting or only touch-ups, and in what colour.

End-of-lease clean

A thorough final clean of the premises before handover, often including carpet cleaning, windows, kitchens, bathrooms and, in warehouses, floor scrubbing or pressure cleaning. See end-of-lease cleaning.

Hoarding

A temporary wall or screen that closes off a shopfront or work area while works happen, or after a shop is vacated. Shopping centres often require it.

After-hours works

Noisy, dusty or disruptive works that a building or centre requires to be done outside business hours. After-hours works usually cost more and take more planning.

Handover

The point when you return the premises and keys to the landlord, usually after a final inspection. Get the landlord's acceptance in writing.

Final inspection

A walk-through with the landlord or agent, usually just before handover, to check the make good against the lease. Take dated photos and get any outstanding items listed in writing.

Sign-off

The landlord's written confirmation that the make good is complete and accepted. It is the document you rely on to get your bond or bank guarantee back.

Quotes and contracts

Scope of works

The written list of exactly what work will be done. A make-good scope should be tied to your lease clause, so contractors quote on the same thing and you only pay for what the lease requires.

Quote

A contractor's price to do a defined scope of work. Read what is included and excluded, not just the total.

Estimate

A rough guide to the likely cost, not an offer to do the work at that price. Estimates from calculators and online tools, including ours, are informational only.

Inclusions and exclusions

What a quote covers and what it does not. Common exclusions in make-good quotes include asbestos removal, after-hours work, waste disposal, permits and repairs to hidden damage.

Provisional sum

An allowance in a quote for work that cannot be priced exactly yet, such as hidden damage. The final cost may go up or down, so check how provisional sums will be adjusted.

Variation

A change to the agreed scope after the contract is signed, such as extra work found during strip-out. Agree variations and their price in writing before the work is done.

Like-for-like quotes

Quotes that price the same scope, with the same inclusions, exclusions and assumptions. Only like-for-like quotes can be compared fairly on price.

Programme

The contractor's timetable for the works, from start to finish. It should finish before your lease ends and allow for building access rules.

Defects

Work that is incomplete or not up to the agreed standard, often raised at the final inspection. A good contract says how and when defects will be fixed.

Retention

An amount held back from payment until defects are fixed or a set period passes. Check whether your contract includes it.

GST

Goods and Services Tax, currently 10% in Australia. Check whether every quote states its price including or excluding GST before you compare them.

Quantity surveyor

A professional who measures and prices building work. The NSW Small Business Commission notes that some retail leases name a quantity surveyor to make a binding decision on make-good costs if the parties disagree.

Safety, licences and approvals

Asbestos register

A record of known asbestos in a workplace. In Victoria, the person managing or controlling a workplace must review it before demolition or refurbishment. SafeWork NSW says one is required for NSW workplaces built before 31 December 2003, or where asbestos has been identified.

Hazardous materials survey

An inspection by a qualified person to find asbestos and other hazardous materials before works disturb them. Photos alone cannot confirm whether asbestos is present.

Friable asbestos

Asbestos that is in powder form, or that can be crumbled, pulverised or reduced to powder by hand pressure when dry. In both Victoria and NSW, removing any amount needs a friable (Class A) licence.

Non-friable asbestos

Asbestos bonded into a material such as cement sheeting. Removing more than 10 m² needs a licence in both Victoria and NSW. In Victoria, unlicensed removal is limited to no more than 10 m² in total and no more than one hour of removal work in seven days.

SWMS (safe work method statement)

A document that sets out how high-risk construction work will be done safely. Ask your contractor for one for strip-out and other high-risk work.

Certificate of currency

A document from an insurer confirming a policy is in force, with the insured name, cover and expiry date. Ask for one for public liability and workers compensation before work starts.

Public liability insurance

Insurance that covers a business's legal liability for injury to people or damage to property caused by its work. Make sure the certificate is in the name of the business you are contracting with.

Building permit

Approval required in Victoria before most building work, which includes demolition. Some internal alterations to commercial buildings are exempt if they meet conditions in the Building Regulations 2018, such as not affecting structure, safety or essential safety measures.

Essential safety measures

In Victoria, building safety features such as fire sprinklers, exit signs, emergency lighting and fire doors that must be kept working. Make-good works that affect them cannot rely on the permit exemption for internal alterations, and usually need specialist trades.

Building management approval

Many office towers and centres require approval before any works: contractor inductions, insurance certificates, work method statements, lift bookings and set working hours. Allow time for it in your programme.

Industrial and retail terms

Pallet racking

Steel shelving systems used in warehouses, usually bolted to the concrete floor. Removal leaves anchor holes that most make-good clauses require to be repaired.

Anchor holes

Holes left in a concrete floor after bolts for racking, machinery or partitions are removed. They are usually filled and finished to match the surrounding slab.

Line marking

Painted lines on a warehouse floor marking aisles, walkways and bays. Leases often require it to be removed, which can mean grinding the floor.

Mezzanine

A raised platform inside a warehouse or showroom, often used for storage or offices. A tenant-installed mezzanine usually has to be removed and the floor repaired. See warehouse make good.

Hardstand

An outdoor sealed area, usually concrete or asphalt, for trucks, parking or storage. Make-good clauses often require it to be cleaned and any damage repaired.

Shopfit

The fit-out of a retail shop: counters, shelving, display fixtures, signage, shopfront changes and lighting. In shopping centres, removal is usually subject to centre rules. See retail make good.

Signage removal

Removing your signs and repairing the surfaces they were fixed to. It often includes building and pylon signs as well as internal signage.

Grease trap

A tank that catches fats and oils from a commercial kitchen before they reach the sewer. Food tenants may have to pump out, clean or remove it at lease end.

Money and security

Bank guarantee

A promise by a bank to pay the landlord up to a set amount if you do not meet your lease obligations, often used instead of a cash bond. If you do not make good, the landlord may draw on it. The NSW Small Business Commission says a lessor should release a bank guarantee within two months of the lessee leaving unless money is owed.

Security deposit

Cash or another form of security held by the landlord against your obligations. Under the Retail Leases Act 2003 (Vic), a retail landlord must return it within 30 days after the lease ends if you have met all your obligations.

Bond

In NSW retail leasing, a cash bond must be lodged with NSW Fair Trading within 20 business days of the landlord receiving it. "Bond" is also used loosely to mean any security deposit.

Payment in lieu

A cash sum paid to the landlord instead of doing the make-good works. Also called cash in lieu or a cash settlement. It is by agreement, so get a written release. See make-good payment in lieu.

Make-good provision

An amount a business records in its accounts for the expected future cost of make good. The Department of Finance publishes illustrative examples for Commonwealth entities. Your accountant decides how to account for it; we can only help with the cost side.

Disputes

Mediation

A meeting where an independent mediator helps the landlord and tenant reach their own agreement. For most retail lease disputes in Victoria and NSW, mediation through the Small Business Commission comes before any tribunal.

Small Business Commission

The state body that helps small businesses with disputes and information: the Victorian Small Business Commission (VSBC) and the NSW Small Business Commission. Both publish free retail leasing guides.

VCAT

The Victorian Civil and Administrative Tribunal. It can hear retail tenancy disputes once the VSBC has certified that mediation has failed or is unlikely to resolve the dispute.

NCAT

The NSW Civil and Administrative Tribunal. It hears retail lease claims, mostly after mediation, up to $750,000 for leases entered into on or after 1 July 2017 (Source: NCAT, Retail leases).

MAKE GREAT terms

Preliminary make-good assessment

The summary MAKE GREAT prepares from your lease and documents. It lists what the lease clearly requires, what needs clarifying and what the documents do not establish, with clause references. It is general information, not legal advice, and a person reviews anything unclear.

Contractor brief

The structured description of your premises and likely scope that MAKE GREAT prepares so every invited contractor quotes on the same thing. Contractors must check it on site.

Vetted contractor

A contractor a person on our team has reviewed and approved to quote through MAKE GREAT, after checking business details, insurance, licences, past work and references. It is not a licence, accreditation or guarantee. See how we vet contractors.

Referral fee

The fee a contractor pays MAKE GREAT if you hire them through us. It is free for tenants, and nobody can pay to rank higher. See how our referral fee works.

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Not sure which of these apply to you? Upload your lease to Analyse my lease for a preliminary make-good assessment with clause references, or Get my make-good quotes from up to three vetted contractors.