Plus, the customization options with build-outs are typically more limited because landlords provide the options. However, having a renovation out of your control can be risky. With commercial build-outs and turnkey agreements, tenants don't have to find a contractor on their own, purchase insurance to cover the workers, or manage the renovation. However, it also means they have to spend time and money finding a commercial tenant improvement contractor. This limits potential cost overruns or quality issues. Pros & Cons of Commercial Tenant ImprovementsĮach type of commercial tenant improvement has its own pros and cons, depending on who is overseeing the project, who is paying for it, and the possible side effects of renovations to your space.įor example, receiving a tenant improvement allowance is usually preferable for tenants because they get to oversee the work. Start by reading our guide on getting a small business loan. If you've never taken out a business loan before, make sure you know all your options. If you have to pay for the renovations before getting reimbursed, getting a business loan or tenant improvement loan might be your best choice. For example, the landlord may pay for the TIs directly, or they may offer a tenant reimbursement for improvements. Within these improvement agreements, there are many other details that can vary. The landlord pays for the improvements and oversees the work.
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