You’ve decided your leased space needs some work to fit how your business actually operates. Maybe the layout doesn’t make sense, the flooring has seen better days, or you need a few more offices carved out. Whatever the reason, a tenant improvement, often called a TI or build-out, can turn a generic space into one that works for you. The process takes some planning, but knowing what’s ahead makes it a lot less overwhelming. Here are seven steps to take once you’ve decided to move forward with a tenant improvement.
1. Review Your Lease and Clarify Your Allowance
Before anything gets torn out or built, go back to your lease and understand exactly what you’re working with. Most commercial leases include a Tenant Improvement Allowance, a set amount your landlord contributes toward the build-out, usually calculated per square foot. Confirm that number, find out whether it applies to your usable space or your full rentable space, and pin down who covers the cost if the project runs over budget. Getting clear on this now saves you from a frustrating conversation with your landlord later.
2. Define Exactly What You Want the Space to Do
Once you know your budget, get specific about what the finished space actually needs to look and function like. Write down every change you’re picturing, from layout and finishes to electrical, plumbing, and IT needs. Think through how your employees and customers will actually use the space day to day, not just how it looks on paper. A clear, detailed scope of work now means fewer surprises and fewer change orders once construction starts.
3. Bring in an Architect and a Licensed Contractor
A tenant improvement isn’t a DIY project, and trying to skip professional help almost always costs more in the long run. An architect turns your vision into real blueprints that meet local building and ADA codes, while a licensed general contractor with tenant improvement experience makes sure what’s on paper can actually be built within your budget. Here in the Twin Cities, look for a team that’s familiar with the permitting process in your specific city, since requirements can vary from Minneapolis to Plymouth to Eden Prairie and beyond.
4. Lock In Your Budget, With Room to Spare
With architectural plans in hand, your contractor can put together a real cost estimate. Compare that number against your Tenant Improvement Allowance to see where you stand and build in an extra 10 to 15 percent as a contingency fund. Construction costs have a way of shifting once work actually begins and having that cushion means an unexpected expense doesn’t derail the whole project.
5. Submit Plans and Wait on Permits
Before any demolition starts, your plans need to go through your local municipality for review. This step takes longer than most people expect, especially in busier Twin Cities suburbs where permit offices are handling a steady stream of commercial projects. Build extra time into your timeline for this stage, since rushing it or assuming approval will come quickly is one of the most common reasons tenant improvement projects fall behind schedule.
6. Stay Involved Once Construction Begins
Once permits are approved and work is underway, don’t disappear until the ribbon cutting. Ask your contractor for regular progress updates, ideally with photos, so you can catch any issues early. Make sure utilities are set up before key construction milestones and put a clear process in place for handling any changes to the original plan, since unchecked change orders are one of the fastest ways a project goes over budget.
7. Finish Strong With Your Final Walkthrough and Certificate of Occupancy
As the project wraps up, walk through the space with your contractor and create a punch list of anything that still needs fixing before you call it done. Once those final items are handled and the space passes inspection, your local authority will issue a Certificate of Occupancy, officially clearing you to operate. Take this opportunity to gather your closeout documents and confirm your Tenant Improvement Allowance funds were applied correctly, so the final numbers match what you agreed to back in step one.
Ready to Build a Space That Works for You? Summerhill Commercial Can Help.
A tenant improvement project touches nearly every part of your business, from your lease terms to your day-to-day layout, and having the right team in your corner makes all the difference. Summerhill Commercial has helped businesses throughout Minneapolis, St. Paul, and the surrounding Twin Cities metro navigate lease negotiations, tenant improvement allowances, and everything in between. Whether you’re just starting to think through a build-out or you’re ready to get moving, our team knows the local market and the local process inside and out. Contact Summerhill Commercial today at 952-473-5650, and let’s turn your space into one that truly works for your business.