Tenant Improvement Bidding: A Guide for Commercial GCs
Tenant improvements are the gateway commercial work for many GCs — smaller scope, faster schedules, and often negotiated rather than hard-bid. But TIs have their own pricing traps, especially around landlord work letters and existing conditions.
Read the work letter carefully
The landlord's work letter defines what's included in base building vs. tenant scope. Misreading it leads to bidding work you don't own or missing work you do.
Existing conditions assessment
Always walk the space. Photographs the existing MEP, ceiling conditions, floor flatness, demising walls. Existing conditions surprises are the #1 cause of TI margin erosion.
Coordinate with building management
After-hours work rules, freight elevator access, hot work permits, and tenant disruption restrictions all affect your schedule and crew costs. Confirm these with property management before pricing.
Schedule realism
Tenants always want to move in yesterday. Build a realistic schedule, identify long-lead items (custom millwork, specialty lighting, AV), and price overtime if the schedule demands it.
Closeout and warranty expectations
TI warranties are often more aggressive than ground-up (1 year on everything plus manufacturer's warranties). Build in closeout time and budget for warranty callbacks.
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Frequently asked questions
What's a work letter?
The landlord's document defining what's included in base building vs. tenant scope. Misreading it leads to bidding work you don't own or missing work you do.
Why do I need to walk every TI space?
Existing MEP, ceiling conditions, floor flatness, and demising walls all affect cost. Existing conditions surprises are the #1 cause of TI margin erosion.
What's typical TI cost per square foot?
Class A office TI runs $80–$200/SF. Restaurant buildout: $300–$600/SF. Medical office TI: $150–$400/SF.
How do I handle after-hours work?
Confirm building rules with property management before pricing — freight elevator access, hot work permits, and tenant disruption restrictions all affect schedule and crew cost.
Bottom line
TI work rewards GCs who do their homework on existing conditions and building rules. Skip the walkthrough and you'll pay for it in change orders you eat.
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