Introduction to Commercial Interior Fit-Out and Leasehold Improvements

18.4.22 Introduction to Interior Fit Out.jpgCommercial fit-out is the process of building out the interior space after the shell and core of a building has been constructed, making interior spaces suitable for occupancy. Generally speaking, base construction builds out the shell and core of a building from casting the foundation to putting the structural components in place and finally separating the interior from exterior elements. Interior fit-out construction takes that shell and core and builds an interior experience to the occupant’s demands. This can involve building out interior partition walls, ceilings, custom lighting, carpets, and office mill-work. Interior fit out can take on a range of different forms, depending on the degree of completion of the building and occupant requirements.

Development ProjectsInterior fit-out is usually involved in the later part of a development projects, where the base construction is completed by the developer and final fit-out is by the occupant who is leasing the space as a tenant. In this case, the fit-out work is contracted out by the occupant to a specialist firm.

Turn-Key: Sometimes the developer will offer to provide the tenant with spaces that are fully fitted out and ready for use. This is also known as turn-key development. The standard of a turnkey development varies depending on what is set out in the lease agreement between the landlord and the tenant.

Leasehold Improvements: Another scenario where Interior fit-out work is commonly carried out is when companies want to refresh their office space.

Fast turnaround and increased client involves are two common characteristics I have observed while working on fit-out projects.

Fast Turnaround

Interior construction projects have fast turnaround times. Depending on the extent of scope, a project can span anywhere between several weeks to several months. In my opinion, the biggest advantage of quick turnaround is that the project manager can get a good sense of construction processes fairly quickly. Project managers will often take on multiple projects at once, tackling unique site conditions and varying project demands. Working on multiple projects results in wider exposure to the trades in the industry, thereby one can establish a well rounded network in a shorter span of time. Interior construction has its own unique challenges as well. Project managers are often under pressure keep the project moving at a optimized pace while meeting client expectations. This results in more workarounds and less time invested in risk management and planning. Experienced project managers will have adjusted their processes based on lessons learned from previous projects. Due to the shorter timelines, I have observed a faster turnover in employment as well. There is often a lack of job security as companies often hire and let-go of their resources based on the shifting volumes of work.

Increased Client Involvements

Leasehold Improvements are typically within existing buildings with tenants and surrounding businesses. Working in occupied spaces demand greater level of coordination and communication with the client. Clients tend to have a higher level of involvement in fit-outs as opposed to base building construction because build outs directly impact their experience. The final finishes can either make or break a space. Greater client involvements could result in increased change requests which can dramatically impact the baseline scope, schedule, and cost. Project managers are encouraged to manage projects with agility and flexibility.

 

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Introduction to Commercial Interior Fit-Out and Leasehold Improvements

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