HOUSTON—Last year was a pivotal one for the office construction sector. Construction costs rose 3% and are expected to continue climbing in 2018 and beyond. Office leasing fundamentals are pivoting as new construction deliveries begin to outpace leasing demand. Moreover, tenant improvement allowances spiked nearly 10% in the latter half of 2017, outpacing rent growth.
JLL recently released its 2018 US and Canada Office Fit-Out Guide. This report that compares build-out costs across three different office styles in 59 markets to give tenants a sense of how choices can affect a fit-out budget.
“Our clients are consistently coming to us with questions about how to get the most bang for their buck when it comes to office fit outs,” said Todd Burns, president, JLL project and development services. “A lot of people might not realize how the smallest decisions around things like lighting, fixtures and quality of materials used can add or shave off thousands of dollars. In a progressive-style space, for example, using high-complexity elements can be an average of $66.10 more per square foot than using base complexity.”
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
