A tenant improvement allowance (TIA) is one of many important details in a commercial real estate transaction. Your tenant representation broker will advise you on the best way to negotiate a TIA based on your organization’s needs.
What is a Tenant Improvement Allowance?
A tenant improvement allowance is a specified amount of money that the landlord agrees to give the lessee so they can make changes to the leased space.
For instance, if your company was searching for new office space and found something nearly perfect but just needed a few renovations, you may be able to negotiate a tenant improvement allowance. A TIA can, in some cases, also be used to cover other expenses associated with the move.
The allowance is written into the lease agreement (typically seen as a dollar amount per rentable square footage) and details how the funds may be used.
How Can You Use a TIA?
You cannot use a TIA for everything. Your business will be responsible for equipment, furniture, and other decorating costs.
The landlord typically only wants tenant improvement allowances to be used for things that will provide lasting value. Building new or removing unnecessary walls, adding doors or windows, new plumbing and HVAC, or new paint and carpet are all common uses for tenant improvement funds.
Don’t Leave Money On the Table
Working with an experienced commercial real estate broker who negotiates on your behalf will ensure you don’t leave money on the table. Securing a substantial tenant improvement allowance can tremendously benefit your company in its next move.
Please contact Steve Longenecker at WeBrokerCORealEstate or 720-600-9513 regarding any commercial real estate needs in Longmont, CO, and our neighboring communities.
We give out $250 gift cards for referrals that become our real estate clients.
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