By August 17, 2022 No Comments

Emerald C’s is a Commercial General Contractor in Jacksonville, FL that provides a variety of construction management services including new design builds, commercial interior renovations and tenant improvements. Many people understand the difference between new construction and renovations, but what are tenant improvements?


Tenant Improvements: Customizing a Rental Space to Satisfy the Needs of a Tenant as Part of a Lease Agreement

In the world of commercial leasing, tenant improvements (also called “leasehold Improvements”) are a common occurrence. Typically, when tenants are planning to lease a commercial space for their business, as part of the lease agreement with the property owner, they require that certain alterations be made to the space to accommodate their individual needs. This can be anything from moving doors and walls to changing the configuration of certain spaces, adding rooms, mechanical equipment, lighting and/or creating a professional interior design plan that reflects their unique brand identity.


Sometimes, tenant improvements occur in commercial spaces where prior tenants had already been operating, effectively requiring a renovation or remodel of the old space for the new tenant. In other instances, a building owner may have left a new space unimproved (unfinished), providing more of a blank finish for a custom build out from the onset.


Negotiating a Tenant Improvement Allowance

In any case, tenants are typically given a per square foot allowance for tenant improvements as part of their commercial lease. This amount is negotiated between the building owner and the tenant, or the commercial real estate agency representing the tenant. If the tenant wishes to spend more than the agreed-upon allowance for tenant improvements, they typically can with the understanding that only certain items can be removed from the space at the end of the lease; usually those items that are not permanently affixed to the building (think furniture, art, etc.). Other items like light fixtures, doors, flooring, etc., typically must stay.


When negotiating tenant improvements, the tenant usually provides the property owner with a preliminary space plan so that both parties can understand what the tenant requires to make the space being leased work for them. The costs of demolition (if required), architectural design, permitting, construction, interior finishes should all be considered by both parties when negotiating tenant improvements. Once the improvements have been completed and the tenant is ready to occupy the space, the lease agreement usually begins. Of course, even factors like this are subject to negotiation by either party.


The Tenant Improvement Process

When Emerald C’s works with a client as a commercial general contractor for tenant improvements, we operate according to their individual needs. This can range from providing very straightforward construction services to more complex demolition, design and construction management. In every case, we meet with our clients to understand their needs, goals and budget, conduct a site analysis if required, and put together a schematic design plan and preliminary cost estimate based on their unique requirements.


As a creative commercial general contractor skilled in design, we love to help our clients integrate their unique brand personalities into their spaces, while also assisting them with value engineering, to strike an ideal combination of achieving their goals while staying as close as possible to their initial budgets. We always strive to provide timely, accurate estimates, even at this early stage.


Once approved, we finalize our construction plans and estimates, secure any permits required, and commence with demolition, or the start of the build-out. Once completed, we perform a thorough walk-through with the client to ensure that everything was built according to plan, and per specifications. If there is anything remaining that needs to be addressed, we do it promptly. Once completed, the tenant is issued a certificate of occupancy and is ready to move their business into their new commercial space.


If you are a property owner, tenant or a commercial real estate company in Northeast Florida who needs help with tenant improvements, contact Emerald C’s. We are a premiere licensed Commercial General Contractor in Jacksonville, specializing in commercial interior build outs and tenant improvements.