Commercial Strip-Out Requirements in Victoria: What Business Owners Must Know for the End of their Lease
If your commercial lease is coming to an end, there’s a chance you will need to return your space to its original condition before handing back the keys. In Victoria, this process is commonly known as a strip-out or make good – and it catches a lot of business owners off guard.
It’s not just about clearing out desks and packing up the kitchen. Depending on your lease, an office strip-out can involve removing partitions, pulling up flooring, disconnecting electrical and data systems, stripping ceilings, and patching every wall back to how it was when you moved in.
The good news is that once you understand what is involved, the whole process becomes far less stressful. Let’s walk through it.
A Quick Introduction
- Most commercial leases in Victoria include a make good clause requiring you to return the premises to its original condition at the end of the lease.
- A commercial strip-out typically involves removing partitions, flooring, ceilings, joinery, and disconnecting services like electrical, plumbing, and data.
- You will usually need licensed tradespeople to safely disconnect services and carry out the work.
- Start planning your strip-out at least 8–12 weeks before your lease ends to avoid rushed timelines and inflated costs.
- Working with experienced fitout builders who also handle strip-outs makes the process simpler – they know how things were built, so they know how to take them apart properly.
What is a “Make Good” Clause?
Almost every commercial lease in Victoria includes a make good clause. In simple terms, it’s the section of your lease that spells out what condition you need to leave the premises in when your tenancy ends.
For some tenancies, this means returning the space to its condition as at the commencement date of the lease – the state it was in before you moved in and made any changes. That might mean stripping the space right back to bare concrete floors, exposed ceilings, and blank walls. Or it might be less extensive, depending on the state of the premises when your lease commenced.
The important thing is to read your make good clause carefully and understand exactly what is required. Some leases are very specific (down to paint colours and ceiling types), while others are broad and open to interpretation. If yours is vague, it’s worth having a conversation with your landlord or property manager early to agree on the scope – ideally in writing – so there are no surprises at handover.
Under Victoria’s Retail Leases Act 2003, retail tenants have certain protections, but even these leases typically require some level of reinstatement. For non-retail commercial leases, the obligations are governed purely by what is in your lease agreement, so there is less of a safety net.
What Does a Commercial Strip-Out Actually Involve?
Every space is different, but a typical commercial strip-out in Melbourne includes some or all of the following:
Removal of internal partitions and walls
Plasterboard walls, glass partitions, aluminium framing, and any non-structural walls you added during your tenancy.
Ceiling strip-out
Removing suspended ceiling tiles, grid systems, and plasterboard bulkheads that weren’t part of the original fit-out.
Flooring removal
Pulling up carpet, vinyl, tiles, or floating floors to expose the base floor beneath. In some leases the flooring must also be replaced.
Disconnection of services
This includes electrical circuits, data cabling, phone lines, security systems, plumbing connections, and air conditioning modifications. These need to be handled by licensed tradespeople.
Joinery and fixture removal
Built-in cabinetry, reception desks, kitchen fitouts, shelving, and any custom joinery you installed.
Furniture and equipment removal
Workstations, desks, chairs, and any remaining office equipment.
Make good repairs
Patching wall holes, repainting to the landlord’s specification, repairing any damage to floors or ceilings, and generally restoring surfaces to a clean, presentable condition.
Patching wall holes, repainting to the landlord’s specification, repairing any damage to floors or ceilings, and generally restoring surfaces to a clean, presentable condition.
Waste disposal
All materials removed during the strip-out need to be disposed of responsibly. A good strip-out contractor will manage skip bins and recycling as part of the process.
It’s a lot more involved than most people expect. And trying to coordinate it yourself – hiring separate painters, electricians, demolition crews, and waste removers – can quickly become a headache. That’s why so many businesses choose a single contractor who manages the entire strip-out from start to finish.
What Does a Commercial Strip-Out Actually Involve?
Earlier than you think. We’d recommend starting the planning process at least 8–12 weeks before your lease expires. Here’s why:
1. Your lease may have specific deadlines
2. Trades need to be booked early.
3. You need time for a scope assessment
4. Landlords may want to inspect
Common Mistakes That Cost Business Owners Money
We’ve seen plenty of strip-outs over the years, and a few mistakes come up again and again:
- Not reading the lease properly
- Leaving it too late
- Doing it yourself
- Not getting a condition report at the start of the lease
- Forgetting about waste
Does the Incoming Tenant Affect Your Obligations?
Sometimes, yes. If a new tenant is moving in and plans to do their own commercial fitout, the landlord may agree to reduce your make good obligations – particularly if the incoming tenant would like to utilise some of the fitout existing in the premises.
This is worth raising with your landlord early. If the next tenant wants to keep your partitions, ceiling grid, or kitchen fitout, you might be able to negotiate a partial make good instead of a full strip-out. It saves you money, saves the landlord time, and reduces waste. Everyone wins.
But don’t assume this will happen. Always plan for the full scope of work outlined in your lease, and treat any reduction as a bonus if it comes through.
How Much Does a Commercial Strip-Out Cost?
There’s no single answer because every space is different. A small office with basic partitions and carpet will cost far less than a multi-level tenancy with custom joinery, glass walls, and complex electrical systems.
Most strip-outs in Melbourne are priced based on the size of the space, the scope of work, and how much waste needs to be removed. The best approach is to get a fixed-price quote based on a proper site inspection and a clear understanding of your lease obligations. Be wary of rough estimates given over the phone without a site visit.
Let Mallaby Fitouts Handle Your Strip-Out
At Mallaby Fitouts, we handle office strip-outs across Melbourne – from small offices through to large commercial tenancies. As we’re also experienced fitout builders, we understand how spaces are constructed, which means we know exactly how to deconstruct them efficiently, cleanly and minimise any damage to the building.
We will review your lease, walk your site, and give you a clear, fixed-price proposal covering the full scope of work. We coordinate all the trades – electricians, plumbers, demolition, waste removal – so you’re not chasing five different contractors. And we will work around your schedule to minimise disruption to your business during the transition.
