Tenant improvements allow you to transform an office into the ideal space for your company, but the process can be costly and frustrating. Fortunately, you can stretch your tenant improvement process and cut down on hassles by following these 8 tips:
1. Stay Involved in the Process
Retain the right to remain a part of the tenant build-out process. If you're involved in comparing bids, selecting a contractor and overseeing the construction, you can actively work to minimize expenses wherever possible.
2. Maximize Your Square Footage
Landlords will often try to base tenant improvements on the usable square footage; however, the amount of rent you pay is actually based on the rentable square footage, the size of the office plus a percentage of shared areas in the building. Insisting that the tenant improvement allowance be tied to rentable square footage will give you more money to invest in improvements.
3. Reuse and Repurpose Where Possible
Before you allocate a penny out of your tenant improvement allowance, take an inventory of what's already in the office. Look for ways that you can reuse existing features or repurpose and improve them. For example, adding a fresh coat of paint to the doors will help you forgo the cost of purchasing new ones.
4. Consider How Your Employees Work
As you plan your space, take into account how your employees work. If large open floor plans and smaller breakout areas are ideal for your team, you can reduce your costs greatly. Keep in mind that for some jobs, privacy is a must, so you'll need to carefully consider what's best for your company.
5. Make a Trade
If your landlord is digging in their heels about the tenant improvement allowance, try shifting the debate. Instead of requesting money for tenant improvements, request free rent for enough months to offset the cost of improvements. Providing free rent costs little to nothing to landlords, and many will be more open to this concession than they are to paying for improvements out of their own pockets.
6. Don't Forget the Details
As you begin to plan your renovations, big considerations like the overall floor plan may be foremost in your mind, but don't overlook smaller details. Removing old carpeting to reveal original flooring or eliminating aging acoustic tiles to reveal an industrial ceiling can enhance the appearance of the space and cost much less than replacing these materials.
7. Think About the Future
When you're planning your tenant improvements, make sure to keep future occupancy costs in mind. Often, it's better to invest in costlier green fixtures and systems like smart thermostats and LED lighting, because they will pay for themselves in the form of decreased energy use.
8. Make Sure No Money Is Left on the Table
In most cases, companies use every penny of their tenant improvement allowances, but there is always a chance that there could be funds left over. Make sure that your lease specifies what happens to any unused money. Specifically, request to have the funds applied to your rent.
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