What are the common reasons for withholding or delaying a commercial lease security deposit refund?

Understanding your lease terms is crucial to ensuring you receive your full security deposit after vacating the property. For instance, if you installed shelving or painted the walls a different colour during your tenancy and your lease requires you to return the property to its original state, you may need to remove the shelves and repaint the walls to avoid deductions from your deposit. Likewise, if your lease stipulates a 90-day notice period before vacating, and you only provide a 30-day notice, your landlord may be entitled to retain a portion of the deposit as compensation for insufficient notice. To safeguard your deposit, be sure to fulfill all obligations outlined in your lease.

While it is imperative the Landlord provides a written statement of the damages and the amount of the deduction it is important that the repair amounts are REASONABLE and COMPETITIVE as well as the refund is processed within X days of the agreed upon amount to be deducted.....the timing for the refund to be received should be addressed within the Lease Agreement.

In a commercial lease dispute, a tenant altered a property without a formal written approval from the landlord. At the end of the lease, the landlord retained the full security deposit to repair the property and return it to its original condition as specified by the make-good clause in the commercial lease agreement. Although the tribunal (NCAT) ultimately decided on a partial refund of the tenant’s deposit from the landlord, this case emphasised the necessity to negotiate clear lease terms and effective communication between the parties prior to the execution and commencement of the commercial lease, as well as during the term of the commercial lease.

Building on this, it is also generally recommended for tenants in a commercial lease to further protect their interest by: negotiating terms of the lease related to the security deposit return, including time frames and the conditions under which deductions may be made, establish a dispute resolution mechanism in the lease for handling disagreements regarding the premises' condition or deposit deductions, and ensure clear terms for early termination that outline responsibilities and any impact on the security deposit or bank guarantee.

I can't stress this point enough - within the Lease Agreement, establish time frames for the Landlord to report any damage claims in writing to the Tenant and time frames for the Landlord to return the security deposit

Nonprofit still fighting with landlord over failure to return security deposit. We left unit the end of March 2023 and to date have yet to receive any written communication regarding deposit. They bought the building just prior to the end of our lease and have had one excuse after another as to why the delay. Now claiming damages even though we were told previously everything was ok. Only damages were a result of a roof leak which they fixed outside but not damages done as a result of it. I called numerous times and sent certified letter however it seems to be a game they are playing. Intend to file with state but open to advice. This is a big company that crosses state lines and has a shaded history of ripping people off. Help needed.