Building owners, property managers, and investment groups want to keep their properties fully occupied and earn as quickly and often as possible while maximizing lease rates for optimal returns.
For commercial properties, tenant improvement construction can leverage higher lease rates and provide a competitive advantage. That competitive advantage will be crucial in light of the dramatic reduction in lease space. Office occupancy rates remain at levels at about half of the pre-pandemic averages. This has led to more vacancies and, in many cases, lower lease rates.
Creating an inviting and customized space for tenants is one way to buck the trend and optimize potential earnings.
5 Ways Tenant Improvement Construction Can Result in More Revenue
So, how can tenant improvement contractors help you drive market rates?
1. Customizing to Tenant Needs
Tenant improvement construction customizes spaces to meet tenant needs. Tenants are more likely to pay higher rents for premium space that fits their unique requirements. They would rather amortize the cost of improvements over the terms of a lease than pay for them.
2. Modernizing Spaces
By enhancing the appeal of the space, tenant improvement contractors can update a facility to make it more attractive to tenants and gain higher lease rates. A modern, clean, and well-designed space is a must in today’s competitive leasing market.
3. Longer Leases, More Renewals
When tenants are happy with their space, designed specifically for them, they are more likely to enter into longer leases and renew more frequently. This reduces turnover and provides a steady cash flow for an extended period.
4. Increasing Property Values
Tenant improvements can increase the value of the property even after tenants vacate. The right renovations can pay dividends for years to come. Premium spaces attract premium tenants and higher lease rates.
5. Competitive Advantage
Offering tenant improvement construction or a TI allowance to prospective clients can create a competitive advantage over other available properties. When others are lowering their rates to attract tenants, you may be able to increase yours.
Factors to Consider When Planning Tenant Improvement Construction
TI construction can be a significant investment, so you need to consider several factors to make an informed decision. Charter Construction Group can help you determine the best course of action to maximize your lease rates.
Cost-Effective Renovations
While you want high-quality construction, you also want a cost-effective tenant improvement project. Working with an experienced tenant improvement contractor like Charter Construction Group can save significant costs. With a nationwide presence and deep relationships with local suppliers and craftsmen in nearly every market, Charter Construction Group can leverage bulk buying and steady employment opportunities to get discounted materials and access to top labor.
Future Tenant Needs
When undergoing renovations, building owners should consider the needs of prospective and future tenants. Develop spaces that are flexible to accommodate future needs. This can reduce the need to rework a space before leasing it to the next tenants.
Charter Construction Group has managed over 40,000 renovation and tenant improvement construction projects. We know which renovations lead to increased rents and which will be of greater value for future tenants.
Timelines
You will want to complete your TI construction as quickly as possible to make the space available and move-in ready. This is another area where Charter Construction Group’s decades of experience helps. Coupled with a proprietary enterprise resource planning (ERP) tool, Charter Construction Group schedules and organizes material delivery, workers, and subcontractors optimally to get jobs done efficiently.
Communication
Contractors do not have a reputation for being great communicators. Charter Construction Group leverages its cloud-based ERP to make sure you are always up-to-date on what is going on with your tenant improvement construction projects. Crews on-site update information in real-time, giving you instant access to a project’s progress.
Experience
Above all, when considering tenant improvement contractors, it is important to prioritize experience. Experienced contractors like Charter Construction Group know how to work efficiently and cost-effectively and provide the high-quality work that tenants value. You get a professional job from start to finish with dependable management for quality assurance.
You can trust Charter Construction Group to do the job right, on time, and within your budget.
Request a consultation with a Charter Construction Group tenant improvement expert or call 866-268-1632 to discuss your needs.