Make good in Victoria: what the law says and what your lease decides

General information, not legal advice. This guide explains Victorian rules in plain English as at 28 October 2026. It is not advice about your lease. For advice on your situation, speak to a property lawyer or contact the Victorian Small Business Commission.

What does make good mean under Victorian law?

There is no Victorian legal definition. Make good is a contractual obligation: the make-good clause in your lease says what you must do before you hand the premises back. The Retail Leases Act 2003 (Vic) does not define make good or reinstatement.

In practice, make-good clauses tend to ask for one or more of these:

The Victorian Small Business Commission (VSBC) puts it simply: retail tenants are obliged to return premises to original condition, which "typically" means removing their fit-out and repairing damage above fair wear and tear. VSBC also notes that if you bought a business and took over its lease, you still have make-good obligations. Check what the lease says about the previous tenant's fit-out before you buy.

New to the term? Read what make good is and make-good clauses explained.

Does the Retail Leases Act 2003 apply to my lease?

This matters, because the Act gives retail tenants protections that office and industrial tenants do not get. The Act covers retail premises: premises used wholly or predominantly for the retail sale or hire of goods, the retail provision of services, or a business the Minister specifies (section 4(1)).

It does not apply where:

• occupancy costs are more than $1,000,000 a year, excluding GST (s 4(2)(a); Source: Retail Leases Regulations 2023 reg 6(1))
• the tenant is a listed corporation, or a body listed on a World Federation of Exchanges member exchange, or a subsidiary of either (s 4(2)(c)–(d))
• the lease term is less than one year, unless renewals keep you in possession for a year or more (s 12)

Whether premises are retail is tested when the lease is entered into or renewed (s 11(2)).

Quick check:

• Shop, café, salon, clinic or showroom serving the public? Likely retail. See also retail make good.
• Office, warehouse or factory not serving the public? Likely outside the Act. Your lease and general law decide your make good. See office make good and warehouse make good.
• Not sure? VSBC can help you work out whether your lease is covered.

What does the Retail Leases Act say that affects make good?

The Act sets no make-good scope, but several sections matter.

You should have been warned before you signed

The landlord must give you a disclosure statement and a copy of the proposed lease at least 14 days before you enter the lease (s 17(1)). The prescribed disclosure statement includes these questions for tenants: "Are you required to make good the premises at the end of the lease?" and "Does the landlord require you to refurbish the premises regularly or at the end of the lease?" (Retail Leases Regulations 2023, Schedules 1 and 2).

The landlord maintains the building, not you

Section 52 requires the landlord to maintain the structure, fixtures, plant and equipment, and the service fixtures it provided, in a condition consistent with their condition when the lease was entered into. Two exceptions: damage from your misuse, and anything you are entitled or required to remove at the end of the lease.

Ask questions if a claim covers wear on the landlord's own plant.

Some lease terms are void

A lease provision is void to the extent it is inconsistent with the Act or tries to exclude it (s 94). A term making a retail tenant indemnify the landlord for liability the landlord would otherwise carry is also void to that extent (s 93). Whether either applies to a particular make-good clause is a question for a lawyer.

Shopping-centre services work has a cost cap

In a retail shopping centre, if you pay for the landlord to alter electrical, sprinkler, power, gas, air-conditioning, exhaust or cabling services for your fit-out, the work must be done by suitably skilled people the landlord engages or approves, and the maximum cost must be agreed in writing first (s 30). If you cannot agree, an independent quantity surveyor sets it.

Do I have to repaint or replace carpet even if it was worn when I moved in?

It depends on the wording. VSBC's FAQs say a repainting clause can require you to repaint to a new condition even where the starting condition was poor, if that is what you agreed in the lease.

Victoria's Property Law Act 1958 lets a court relieve a tenant from an unreasonable notice to carry out internal decorative repairs (s 147(1)). But that relief does not apply to a covenant to "yield up" the premises in a specified state of repair at the end of the term (s 147(2)(d)), which is how many make-good clauses are written.

Do I need a condition report?

No Victorian law requires one. The Retail Leases Act does not mention condition reports. But VSBC recommends that, wherever possible, landlords and tenants agree a condition report at the start of the lease and both keep copies. At the end, that report and your move-in photos are your strongest evidence about what you changed and what was already there.

No report? Gather move-in photos, listing images, fit-out drawings and invoices.

When will I get my security deposit or bank guarantee back in Victoria?

For retail leases, section 24 sets the rules:

• a cash security deposit must be held in an interest-bearing account, and interest can be added to the deposit
• the landlord cannot unreasonably refuse a bank guarantee instead of a cash deposit
• if you have performed all your lease obligations, the landlord must return the security deposit within 30 days after the lease ends

"All your obligations" includes make good. A written sign-off from the landlord or agent that the make good is complete is the cleanest way to show you are entitled to it back. For non-retail leases, the lease terms decide timing.

What happens if I do not make good?

The landlord can claim the cost of the work. In Tabcorp v Bowen [2009] HCA 8, a tenant demolished and rebuilt a foyer without the consent the lease required. The High Court allowed the landlord to recover the cost of reinstatement, not just any drop in the building's value.

No Victorian equivalent of the NSW rule capping repair damages at loss in property value was found in the Property Law Act. Before a landlord can end a lease or re-enter for breach, it must serve a notice specifying the breach and asking you to fix it (Property Law Act 1958 s 146; applied to retail leases by s 94A of the Retail Leases Act).

Many tenants agree a cash payment instead of doing the works. That is a negotiation, not a legal formula. See make-good payment in lieu.

How are make-good disputes resolved in Victoria?

For a retail lease (including a former retail lease):

1. Ask for the claim in writing, item by item, linked to lease clauses.
2. VSBC mediation. Any party can refer a retail tenancy dispute to VSBC (s 86). VSBC's published fee for most commercial mediations is $300 per party for a half day or $600 per party for a full day, including GST (Source: VSBC FAQs). What is said in mediation cannot be used later in court (s 88).
3. VCAT. VCAT can generally hear the dispute only after VSBC certifies in writing that mediation has failed or is unlikely to resolve it (s 87). Each party usually pays its own costs, but VCAT can order costs against a party that refused to take part in mediation (s 92).

For non-retail commercial leases, VSBC also handles some disputes under the Small Business Commission Act 2017, and can certify that a party unreasonably refused to take part. Otherwise the courts apply the lease.

What Victorian rules apply to the make-good work itself?

A Victorian make-good checklist

• Find your lease, variations, disclosure statement and any licence to alter or fit-out approvals
• Confirm whether your lease is a retail lease under the Act
• Mark the make-good, alterations, redecoration and yield-up clauses
• Collect your move-in condition report and photos
• Ask the landlord in writing what can stay (a next tenant may want your fit-out)
• Get the asbestos register and check permit needs before strip-out
• Get comparable quotes from licensed, insured contractors
• Finish before your lease ends, inspect with the landlord, and get written sign-off
• Follow up your deposit or bank guarantee (30 days for retail cash deposits)

Our lease exit timeline sets out when to do each step, and the office make good checklist covers office tenancies in detail. Leasing in NSW too? Compare the rules in make good in NSW.

How MAKE GREAT can help a Victorian tenant

• Analyse my lease. Upload your lease and our lease check finds the make-good, alterations and redecoration clauses, with page and clause references. It is preliminary, not legal advice. It separates what the lease clearly requires from what needs clarifying, and unclear or high-risk findings are flagged for review by a person.
• Get my make-good quotes. We turn your lease and photos into a clear brief and invite up to three approved contractors who work in your part of Melbourne. If fewer than three are eligible, we tell you. Read how we vet contractors.
• Compare like for like. Quotes sit side by side with inclusions, exclusions and licence and insurance status.

You choose the contractor and contract with them directly. MAKE GREAT is a marketplace, not a builder, building surveyor or law firm.

How we are paid: Free for tenants. If you hire a contractor through us, they pay us a referral fee. Nobody can pay to rank higher. You are never obliged to accept any quote.