The per-square-foot reality
TI pricing spreads wide because 'improvement' spans everything from paint-and-carpet to gutted reconfigurations. Second-generation office space needing finishes and lighting lands at $80–$150/sq ft in 2026's South Bay market. Add wall reconfiguration, new HVAC zoning, and electrical distribution: $150–$250. Retail swings on storefront and use; medical runs $200–$400+ because exam-room plumbing and equipment coordination are construction multipliers. These numbers include design and permits; they exclude furniture, IT, and signage — budget those separately.
Your allowance is smaller than it looks
A $75/sq ft allowance against a $150/sq ft buildout means you're funding half the project — a fact tenants discover at contract signing instead of lease negotiation. Worse, allowances pay out on the landlord's terms: draw schedules, lien-release formats, completion conditions, and deadlines that can quietly turn 'allowance' into 'reimbursement you float for months.' Negotiate the disbursement mechanics with the same energy as the amount, and get unused-allowance treatment (rent credit versus forfeiture) in writing.
The code triggers nobody budgets
- ADA path of travel: any permit triggers accessibility review — parking, entry, restrooms — commonly $15K–$60K in older buildings (capped at 20% of project cost for smaller projects)
- Title 24: touch lighting or HVAC and the new work meets current energy code — add 10–20% to those trades
- Fire/life safety: occupancy changes can require sprinkler, alarm, and exiting upgrades — the verify-before-signing item
- Structural: mezzanines, rooftop units, and heavy equipment trigger engineering review
Worked example: 5,000 sq ft second-gen office
Scope: new paint and carpet, updated lighting, two new conference rooms, kitchenette upgrade, ADA restroom compliance. Construction: $90–$120/sq ft → $450K–$600K. Design and permits: $35K–$55K. Code adders (ADA + Title 24 lighting): $40K–$70K. Total project: roughly $525K–$725K. Against a $75/sq ft allowance ($375K), the tenant funds $150K–$350K — knowable in week one with a proper evaluation, unbudgetable in month four without one.
The move that changes the math: evaluate before you sign
Every number above is negotiable exactly once — before the lease is signed. A pre-lease space evaluation prices the real buildout including code triggers, and that number becomes your negotiation: more allowance, more free rent, or a different space. Tenants who sign first and price later negotiate with themselves.
Get these numbers for your project
Estimates, feasibility checks, and consultations — answered within one business day by a licensed Bay Area team.
Frequently Asked Questions
How long does a typical TI take?+
From lease signing: 2–4 weeks space planning, 3–6 weeks construction documents, 4–12 weeks permits, 8–20 weeks construction — 4 to 9 months total depending on scope and city. Free-rent periods should cover the honest version of that timeline plus buffer.
Turnkey or tenant-managed buildout?+
Turnkey (landlord builds) transfers schedule risk but surrenders control of quality, spec, and transparency — fine for commodity space. Tenant-managed with allowance gives you the contractor, the spec, and the accountability — the right call whenever the space is operationally important.
Can BARC work directly with our broker?+
Ideal, actually: broker negotiates the deal, we supply the buildout numbers that power the negotiation, and the work letter gets written around a real scope. Three-way alignment before signing is the cheapest insurance in commercial leasing.
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