Contractors use a lot of commercial construction-specific terminology when talking to landlords and tenants. Language that makes complete sense to architects and builders but confuses anyone outside of the industry. Especially first-timers who haven’t dealt with construction for tenant or leasehold improvements before. “Interior build-out” is one of those terms. In this blog post, H.W. Holmes, Inc. – a Southern California commercial construction company specializing in leasehold improvements – explain exactly what a tenant interior buildout is and when it’s necessary.
What is an Interior Build-Out?
An interior buildout typically refers to a commercial interior space that is a white box finish – also sometimes referred to as a vanilla shell or box, a plain vanilla shell or box, a warm vanilla shell or box, or a warm white shell or box. These are all various terms used to describe a commercial space with an unfinished interior.
A white box finish includes:
- Roofing
- Doors and Windows
- Main Walls
- Ceiling
- Concrete Floors
- Basic Plumbing
- Basic Electrical Wiring & Outlets
- Lighting
- Basic HVAC Components
A white box finish doesn’t include:
- Interior Walls (beyond code requirements for restrooms)
- Paint
- Wall Coverings
- Finshed Flooring
- Plumbing Fixtures (beyond drinking fountains and code required restroom fixtures
- Upgraded Electrical Fixtures
This space clearly isn’t move-in ready, but the commercial owner has it ready for tenant and leasehold improvements once a prospective tenant is interested. This means this partially finished space can be custom built to that tenant’s exact specifications once the terms of the lease have been negotiated and agreed to.
Every Tenant is Different and has Different Needs
A white box finish is typically a new construction. It can also sometimes be a space with the previous tenant’s look that the property’s owner has decided to gut to revert back to a white box or empty shell space. The idea is this shell space will appeal to a tenant looking for a blank slate that can quickly be converted into virtually anything they’ve envisioned for their business. A tenant thinking of opening a coffee shop and vegan eatery doesn’t see the finishings of the Taco Bell that once resided there as they walk through the space.
Additionally, the landlord will usually offer financial incentives to the prospective tenant to cover some of the costs of this interior buildout. This is offered in the form of a tenant improvement allowance or a TIA for short. This is where the landlord agrees to pay for a percentage of the tenant’s interior buildout costs.
What the landlord agrees to cover is part of the lease negotiation process. Market trends and the type of space being upgraded will factor into who has the most negotiating leverage – the landlord or tenant.
Need an Interior Buildout in Los Angeles, Ventura, or Santa Barbara Counties?
If you need an interior buildout in the Ventura/LA area, an experienced tenant improvement construction company like H.W. Holmes, Inc. can help you determine the costs of the improvements you’re envisioning.
Our team is comprised of commercial construction professionals who are trained and prepped to provide you with an outstanding interior buildout experience. We maintain a high standard of professionalism and superior craftsmanship with our tenant interior buildout services. If you’d like to discuss your project, please contact us via the form on this website or call us today at 805-383-9929.