Tenant improvements (TI’s) are often the biggest hidden cost in leasing.
A Real-World Story
A restaurant tenant assumed the landlord would cover all build-out costs. Midway through construction, costs exceeded the allowance. The tenant had to fund the overage personally to open on time.
Key Points
- TI allowances are negotiated
- Cost overruns usually fall on tenants
- “Free build-out” is rarely free
Conclusion
Clear expectations prevent delays, disputes, and financial stress.
Written by Sav Cheema, Commercial Real Estate Advisor with RE/MAX Elevate, serving business owners, landlords, and investors across British Columbia, Canada.
Disclaimer: This blog is for general information purposes only and does not constitute legal, accounting, tax, or professional advice. Always consult qualified legal, accounting, and real estate professionals regarding your specific situation.
.
