An office lease is not just a price per square metre. Behind that number are two questions that directly affect the fit-out budget: what the landlord delivers, and how much they contribute. Check them before you sign and you avoid surprises. Check them after, and you'll find them in the invoices.
What Shell & Core means
In most new buildings the landlord delivers the space as "shell": structure, façade, lobby, lifts, risers and the building's main systems. Everything inside the space, partitions, ceilings, flooring, HVAC distribution, electrical and communications, is the tenant's fit-out work. But there is no single definition. In one building "shell" includes HVAC units on the floor, in another only provision for connection. So the term alone is not enough.
The delivery specification: the most important document in the lease
The delivery specification defines exactly what will be in the space on handover day. Make sure it covers at least:
- HVAC: the type of system, what is installed on the floor and what is only ready for connection, and who pays for distribution within the space.
- Electrical: the capacity allocated to the space, the location of the distribution board, and what the supply includes.
- Fire protection: whether sprinklers are installed and in what condition, and who is responsible for adapting them to the new design.
- Plumbing: the location of water and drainage points for toilets and the kitchenette.
- Floor and ceiling: the condition of the floor, clear height, and what may be suspended from the slab.
- Communications: infrastructure entry into the building and the space.
- The handover date and what happens if it slips.
The landlord's contribution to fit-out
Many landlords contribute to fit-out costs, as an amount per square metre or a lump sum. Here it is worth asking:
- What exactly does the contribution cover? Only fixed works (partitions, ceilings, systems) or also furniture and communications?
- How is it paid? Against invoices, at completion, or as a rent offset?
- Who carries out the works? Some landlords require the work to be done by their contractor or with their approval.
- What happens at the end of the lease? Do you have to reinstate the space to its original condition, and at whose cost?
Why this matters for the budget
The difference between a full and a partial delivery specification can be an entire trade in the budget, mainly HVAC and fire protection. That is why I recommend building an initial fit-out estimate before signing, based on the delivery specification. That way you compare properties by their real cost, not just by rent.
FAQ
Is it worth involving a project manager before signing a lease?
Yes. Reviewing the specification and an initial estimate takes days, and it affects a decision for years.
What is the difference between a landlord contribution and a rent discount?
A landlord contribution funds works in the space. A rent discount reduces the monthly payment. It is worth calculating them together to compare offers.
