In construction, a build out can mean a couple of things. It can mean literally expanding or building out from a pre-existing, smaller building. Or it can mean an interior build out, where there is an unfinished interior space waiting for finishing for a new commercial tenant to move in. There is a lot that goes into either of these scenarios, but what all goes into construction build out costs?
There are basic, expected fees here such as labor costs and regulations for the various construction models. In some construction models wood frame is possible which can keep costs low. However this depends on the location and occupancy of the building. In areas requiring non-flammable construction, wood frame is not permitted, thereby increasing costs.
In expansion build outs (as opposed to interior build outs), additional square footage is added, sometimes requiring additional property. The size of the lot plays a major role in this type of build out, and costs may be incurred in purchasing or preparing additional land – particularly since commercial property is more costly than residential.
If commercial expansion build outs are large, then sound proofing is required between tenant stores or offices – another item of cost. Likewise the space may require customized entrances, and more functional separations between tenants, for easy deliveries or custom handicap entrances. Of course the more tenants to a building increases signage costs, in addition to exterior and interior customization. Because the exterior as well as the interior is grown in an expansion build out, there are costs associated with additional HVAC, plumbing, electricity and sometimes restrooms in the expansion.
Commercial interior build outs typically start from a white shell or white box; a space which has been prepared by knocking out the customized interior requirements of the previous tenant; essentially to re-start as a plain, unfinished interior ready for the next tenant improvements to be implemented. As example, previous floors and walls may have to be gutted and removed to become a white box.
Finishing this space for tenant improvements requires costs for customization of floors, walls, ceilings and more. Frequently an interior architect or designer is involved for designing the space, bringing associated costs. There are also requirements such as building codes, requiring cooperation between the building engineer, landlord and tenant.
Specifically, build out construction, after design is ready, can involve updating:
- wall painting and finishes
- counter tops
- lighting and other fixtures
- and even potentially plumbing fixtures.
- Also for interior build outs, added costs could include specialty items such as skylights or vaulted ceilings.
- (HVAC, plumbing, restrooms and electricity would have been provided in the original “white box”).
So what all are construction build out costs? They can be associated with expansion, or simply updating a white box interior. The right planning between all parties reveals the costs of the white box versus the customized finishes and additional fees.
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