Tenant Improvements

Transform Your Commercial Space with Tenant Improvements

How Tenant Improvements Can Help You Create the Best Commercial Space for Your Business. From Construction to Stairs, Here’s What You Need to Know!

Tenant Improvements

When your business expands and evolves, it is crucial to accentuate your brand, feel distinct, and satisfy your company’s demands. Tenant improvements can help you accomplish these objectives for a modest repair or a more extensive business renovation.

What are Tenant Improvements?

Tenant improvements are modifications to a rented space to make a building suitable to the tenant’s needs. These can include:

  • Creating an office out of unfinished floor space
  • Installing energy-efficient lighting
  • Building a dramatic staircase between floors
  • Adding new electrical outlets
  • Adding canopies and wheelchair ramps for accessibility
  • Complete interior renovation
  • Replacing rusted, damaged, cracked, and or non-compliant egress stairs 

What Qualifies as a Tenant Improvement?

There are many different types of tenant improvements. Below are some general examples of what is and is not considered a tenant improvement.

Constructing interior walls and ceilings
Changing the flooring
Building cabinetry
Adding electrical lines and plumbing
Installing air conditioning
Adding fire protection measures
Improving security, safety, and accessibility
Code Compliance Issues
Office chairs & furniture
Repaving outdoor walkway
Running phone and internet cables
Upgrades to a common-use elevator
Legal fees or consultants
Moving expenses
*Non-Qualified – Unless negotiated otherwise
Warehouse dock canopy

Stairs, ramps, and canopies engineered for tenant improvements.

With our expert team, we specialize in designing and installing custom solutions that not only enhance the aesthetic appeal of your building but also ensure compliance and safety.

Who Pays for Tenant Improvements?

In most cases, the costs of tenant improvements are shared between the landlord and the tenant. There are several typical setups for paying for tenant improvements, including:

  • Tenant Improvement Allowance (TIA)
  • Building Standard Allowance (BSA)
  • Turnkey job
  • Rent discounts
Tenant Improvement Allowance (TIA)

The tenant improvement allowance is the money the landlord will spend on renovations to the leased property. The lease often states this cost and likely a set payment or a price per square foot. If the cost of the improvements exceeds the TIA, the tenant must pay the difference.

Getting at least one or two preliminary construction bids is advisable to avoid unexpected expenses during the negotiation process. For example, accepting an allowance of $18 per square foot may seem like a good deal, but ensuring that the total construction cost does not exceed the allowance is essential.

What is an Average Tenant Improvement Allowance?

The market, lease term, credit rating, and the type of space effects TIA, but landlords typically offer an allowance of $25-$40 per square foot for a new space (aka shell condition or first-gen) and $20 or less for a space that has been previously occupied (second-gen).

Higher-end markets have tenant improvement packages. For example, the NYC market is around $48 RSF* and $60-80 RSF for the Los Angeles market**.

How Do You Calculate a TI Allowance?

The Tenant Improvement Allowance (TIA) is typically given based on the commercial space’s rental square feet (RSF). To calculate the Tenant improvement allowance, multiply the RSF by the TI allowance you have negotiated. (Example: 5,000 RSF x $15 RSF = $75,000)

Sources: austintenantadvisors.com | *us.jll.com | **myelisting.com
Tools: Tenant Improvement Amortization Calculator

Building Standard Allowance (BSA)

With a building standard allowance (BSA) a specified leasehold improvements they are willing to pay their tenants. With a BSA, the landlord is responsible for any cost overruns rather than the tenant. If your business requires tenant services not included in the BSA, you must pay for them yourself.

Many landlords offer a building standard allowance (BSA) or a package of specified leasehold improvements they are willing to pay their tenants. With a BSA, the landlord is responsible for any cost overruns rather than the tenant. If your business requires tenant services not included in the BSA, you must pay for them yourself.

Turnkey Job

Building standard allowance (BSA) is a package of specific leasehold improvements landlords often provide tenants. This offering covers the cost of these improvements, and the landlord, not the tenant, bears any cost overruns. However, the tenant is responsible for paying services not part of the BSA.

Rent Discounts

Occasionally, landlords may offer a rent discount or waive rent entirely for tenants during leasehold improvement projects. However, the tenant remains responsible for any additional costs associated with the project and has full control over its execution.


Whether you require improvements like stairs, wheelchair ramps, canopies, or other types of tenant services, tenant improvements can help you create the best commercial space for your business. Upside’s skilled technicians, engineers and access experts can provide years of experience to help your business meet its lease improvement needs.

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