Constructing Tenant Improvements
A Long History of Tenant Improvement Work
BFL Construction Company has successfully managed tenant improvements of over three million square feet in both new and occupied buildings throughout Arizona. We are experts in working within the confined area of finished spaces involving other tenants or landlord operations.
As the economy creates the opportunity for clients to move into bigger and better available space, we are here to assist you with a smooth transition through the technicalities of tenant improvements.
Importance of Work Letter of Agreement
TI work done on the interior of a space can be paid for by landlord, tenant, or some combination of both, depending on the terms of the lease and often involves more than just the single user.
One of the most important features of a tenant improvement project is the development of a tenant work letter, which is a detailed description of: what the landlord and or the tenant will be providing toward the improvement of the premises; and what elements are attributed to each party in relation to total tenant improvement cost. This should fully address the issue of demolition of existing improvements and utilities.
Construction within a tenant space must take many different factors into consideration. There are often other tenants using common spaces, which must be kept free of debris. Staging areas are often limited, and access control, noise, and dust factors must always be addressed.
Often other tenant spaces must be entered to conduct work on mechanical, fire protection, or communication systems. TI work is sensitive and requires clear communications, as well as specifically planned operations for the safety, security, and privacy of others located in the building.
Typically the tenant manages the construction of the improvements to the premises after the landlord delivers the space in an agreed-upon delivery condition, but the contractor working directly for the tenant will still be controlled by the landlord and building rules.
The landlord provides a tenant improvement allowance toward the cost of the improvements, and the tenant bears all costs in excess of that allowance. Often a separate and open book accounting is required to assure all participants about what they are paying for.
A tenant build work letter permits the tenant to tightly control the costs, quality, and pace of construction. This may come, however, at an unacceptable price if the tenant and landlord cannot act with the speed necessary to meet the tenant’s business goals.
Conforming to Tenant Specs
BFL’s defined objectives are to always strictly adhere to tenant’s specifications. These include:
- Conforming to the leasehold improvements as per specifications;
- Conforming to particular and unique business needs;
- Completing leasehold improvements by the date necessary for business objectives;
- Minimizing disruption of any and all business operations;
- Minimizing costs for leasehold improvements; and
- Avoiding any additional tenant responsibility for base building improvements.
From our project management point of view, the issues revolve around control and are summarized by:
- Control of costs;
- Control of schedule;
- Control of the environment around the improved space; and
- Clear communication concerning the elements of an interior designed construction project.