The real estate industry like any other type of industries also has some room for negotiation. This negotiation process does not only apply when you are trying to purchase a certain property, for such activity can also be applied in the context of commercial or office space rental, particularly on a tenant improvement allowance.
According to austintenantadvisors, 'tenant improvement allowance' or TI "is a specified amount of money that the landlord will give to the tenant in order to use for upgrading and renovate the space. The amount will usually be based on the square footage of the space." For a new tenant, knowing the amount is not just enough, there are other things which you should learn. Here below are some areas of concern that you should understand when it comes to negotiating for a tenant improvement allowance.
Know Your Space
As also discussed in austintenantadvisors, you should have at least a visual or idea of the layout especially that tenant improvement allowance would be based on the square footage of the space. It is vital information to have in order for you as its future tenant not to immediately accept a TI lower than what you would actually need. In cases wherein you really don't have any idea about space and measures, you may employ the help of a space planner or architect.
Upgrade Manager
You should also discuss with your landlord who will control the hiring process for the rehab or restructuring of the place. In most cases it is the landlord who would be in charge for he basically owns the building. You may also help in the process especially in directing the final build, but if you think the landlord is good enough to handle things for you including the financial side, then you may do so. Just make a clear and open path for communication.
Room for Negotiation
Always remember that when it comes to tenant improvement allowance there would always be a room for negotiation. In the very first place the TI is being offered in order for you to be enticed and rent out the said commercial or office space. The landlord would really like his property to start generating income rather than be stagnant. Having that idea in mind, you may capitalize on such need in order to negotiate or have a more beneficial tenant improvement allowance.
What do you think about tenant improvement allowance, and would you even bargain for it? Feel free to share and comment below.
