Before kicking off the construction needed to transform your retail space, there’s a lot of information to gather and ground to cover first.
At Denver Commercial Construction, we’ve helped numerous clients understand how to estimate retail tenant improvements.
Because we’ve seen simple renovations run into unforeseen issues and expenses, we know that being prepared will help you avoid budget overages and schedule delays. With the proper foundation, you’ll have your dream space completed quickly and cost-effectively.
#1 Develop a Detailed Estimate
Your first step is outlining the improvements you wish to make and the associated costs to complete the work.
Items you’ll want to roll into the estimate include design costs, construction costs, materials and required permits.
If the landlord provided a Tenant Improvement Allowance (TIA), you can then see how much is covered and what overages you’ll have to pay out of pocket.
Don’t forget to add a contingency fund of at least 5-10% of your estimated costs.
This fund will cover you in case any unexpected costs come up. If adding this figure causes your estimate to exceed your budget, we recommend cutting elsewhere and keeping your contingency in place.
Even if you don’t run into any issues, it can be used to upgrade your design at some point or simply bring your retail tenant improvements in under budget.
#2 Furniture Fixtures & Equipment
Another consideration when determining how to estimate retail tenant improvements and construction costs is what’s known as Furniture, Fixtures & Equipment (FF&E).
If your landlord has provided a TIA, items that fall under the FF&E category are typically not covered, so be sure to make room in your budget for items such as desks, chairs, tables, bookcases, product displays, even cubicle-style furnishings. Don’t forget computers and electronic equipment, as well as the installation of cabling.
If you’re moving from one location to another, moving costs will run you about $1.00 per square foot. Just be sure to get more than one bid from companies experienced in moving businesses.
#3 Break Down Construction Costs
For a standard retail build – including the design, construction and permitting costs – there are some general figures out there to give you a ballpark range of what to budget for your project.
However, final prices can vary greatly based on whether or not certain items are already available to you:
- Carpet and Paint – Existing unoccupied space versus existing occupied space
- Remodeling – Minor (50% of the space or less) versus major, as well as unoccupied or existing space
- New Construction – Warm shell (no need for lobbies, restrooms, etc.) versus a cold shell build of these items
Of course, most costs you’ll find while researching are for standard grade materials and improvements.
If you want to use higher end finishes and materials, just prepared for increased costs. Talk to your designer and/or builder to dig deep into the actual costs that you should expect to pay for higher-end finishes.
Choose DCC for Retail Tenant Improvements
At Denver Commercial Construction, we know retail store construction inside and out, as well as how to estimate retail tenant improvement costs.
If you’re new to the process, it can be a lot to manage, which is why we offer expert guidance from start to finish.
We can assist you with estimates, project planning, crew scheduling, site development, budget and design management, as well as permits. Simply contact our team today and let us help you with a successful retail launch.