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When leasing an office what should I look for that will increase the fitout cost?

When leasing an office what should I look for that will increase the fitout cost? How much will my fitout cost for this office space? Never leased an office before, what can I be caught with in my office lease agreement? What to look for in an office lease agreement.

Every office space has a different fitout cost based on the location, site conditions and building management. The process with leasing a space can be daunting especially when you don’t know what the fitout will cost. Consider the points below when looking for a new space.

  • Space planning
    • It is important to have a fitout company do a site check prior to signing a lease. They will be able to provide a test fit on the space and give an indication of what the costs will be. Zircon offers this at no cost, so feel free to contact us on 1300 ZIRCON or info@zirconinteriors.com.au to organise a site check.
  • Site conditions
    • Every tenancy is totally different, even within the same building. Some areas to note are;
      • With an existing building, is the landlord going to demolish the existing walls, provide new carpet and replace the ceiling tiles? These areas are normally provided as part of the lease negotiations but can be very expensive if you need to complete these works.
      • Do you need a large boardroom/training room? Regulations will require these rooms to have supplementary air-conditioning. Based on the building conditions this exercise can be very expensive. Likewise, supplementary air-conditioning required for a comms room is also quite expensive in a high-rise building.
      • Partitioning. You may only require simple fitout such as offices, meeting rooms, boardroom rooms, lunchrooms etc but note that the fire services, mechanical (air conditioning), emergency lighting etc will also need to be relocated to suit the new layout. Budgetary costs can be provided on this to ensure you are covered in your budgeting.
      • Existing partitioning is great to reuse. Please note that if the partitioning is demountable (built in panels approx 900mm wide and it is 45mm thick) this can be costly to match and the overall appearance of your fitout will be dated.
      • A building permit for an office fitout is nearly always required. Speak to your builder (also make sure your builder is registered by the local building authority) to help you understand what is needed to ensure the fitout and office complies. A building permit for an office fitout may trigger compliance issues within the common area of the building so it is important that this is understood prior to undertaking any works in case negotiations are needed with the landlord.
      • Plumbing will need to be assessed when you are adding or changing toilets, kitchens, showers etc.
      • Core drilling and chasing the floor often requires an engineer’s certificate. Most land lords don’t allow this to happen as it weakens the slab.
      • Ceiling height. Standard materials for an office fitout are 2700mm long, if the ceiling is above 2740mm we will need to use the 3000mm length materials adding to the cost of the fitout.
      • Lift access is critical for glass as this needs to be full height to the ceiling. If the lift isn’t big enough the materials will need to be taken up the stairs resulting in increased labour and costs.
  • Building management
    • Every building manager is different. Some require bonds so make sure you ask them what they need from you and the builder.
  • Lease agreement
    • It is very critical to understand the lease agreement. One of our clients wasn’t aware that they were leasing a tenancy without any front doors. Front entry doors can be very expensive due to swipe pass systems, fire escape systems etc.
    • Demolition clauses; this allows the landlord to terminate the lease if the landlord intends to demolish the premises, usually as part of a larger demolition project. You could theoretically be notified this the day after you have signed your lease.
    • Make good clause; It’s a standard clause included in most commercial leases requiring tenants to return the property to it’s original state. Make good clauses are most likely to appear in an agreement where the tenants lease the building as a shell or intent to change an existing fitout. As example of this, a recent potential client had to replace the carpet with exactly the same carpet even though it wasn’t worn.

Zircon is willing to assist you in this process as it is our goal to make your business successful by getting the best result from your space. Zircon also assists our clients with finding the right tenancy and negotiating the deal to get the best incentive for the space. We are only an email or call away, so contact us today on 1300 ZIRCON or info@zirconinteriors.com.au

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