The lease requires me to pay for fitting-out works to the premises, but the actual costs are much higher than I expected. Can I negotiate to reduce these costs or ask the landlord to share the expenses?

The lease requires me to pay for fitting-out works to the premises, but the actual costs are much higher than I expected. Can I negotiate to reduce these costs or ask the landlord to share the expenses?

In most cases, you cannot force your landlord to share or reduce fitting-out costs unless your lease expressly allows for it. Your obligation to pay depends on the specific terms of your lease agreement.

Understanding Your Lease and Fitting-Out Costs

• Lease Agreement Terms:
  Lease contracts in Hong Kong are governed primarily by contract principles. It is not uncommon for tenants to bear fitting-out costs in commercial leases. Sometimes, landlords offer rent-free periods or financial contributions (fit-out allowances) as incentives, but they must be expressly agreed.
• Obligation to Pay:
  If your lease states you are responsible for fitting-out costs, you are generally required to pay regardless of whether the actual expenses are higher than expected. The landlord is not obligated to reduce or share these costs unless your lease provides for such flexibility.
• Legal Risks:
  Refusing to pay without a contractual basis could lead to legal troubles. Always review your lease for clauses related to fitting-out works and costs.

Can I Negotiate?
While your landlord is not legally required to share your expenses, it’s often worthwhile to discuss your concerns with your landlord. During a soft rental market, landlords may be more willing to negotiate to avoid vacancy.

For more on lease negotiations and property law, see our Guide to Commercial Lease Agreements in Hong Kong.

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