For people looking to achieve control on costs in a new fit out, something that is often not considered serious enough is Category 1 costs. In the commonly used commercial retail leases, there will normally be a clause concerning Category 1 works and the related costs. These works related to the cost of any extra modification related to the building, which the lessee would like to make in order to satisfy his own requirements or the requirements of a prospective tenant. In brief, though the work has been requested by the lessee who will also bear the cost, it needs to be commissioned by the landlord. These costs for the lessee are in addition to its expenses relating to rent, normal outgoings and any other agreed expenses or costs. Category 1 costs can often be quite substantial and, in the case of a new retail store, could be as much as 15% of the total cost of refurbishment.
Category 1 works can consist of a lot of fit out items and, in addition to the integration of standard work, such as plumbing and air conditioning, could include the costs of connection to important services such as gas, water and electricity, and any changes. The costs of additional and subsequent reviews of design could also be included. Though these jobs are important for the filling out of any new retail outlet, the costs associated are often not covered in the scope of work submitted by shopfitters concept. The other problem is that they may be spelt out in the lease but without any attached costs indicated and the document might simply say that they will be performed at the expense of the tenant. The lessor may be built at a later date, often after all funding has been finalised. This can create additional expenditure which could be sizeable and not included in budgets and therefore would need to be financed from the resources of the business rather than as part of the package for capital expenditure.
These fil out expenses can be restricted to the minimum is in participation at an early stage, preferably during the lease negotiation if possible. This allows a review of the scope of work in the greatest of detail. Work should also be carried out in association with the landlord to explore the possibilities of requirements relating to safety. This process can often result in certain items being slashed of done away with altogether by exploring different options for carrying out the same work. The result would be the potential of significantly reducing cost on some items without any compromises on fit out design and quality standards specified by the lessee.
Space Plan Fitouts in Victoria have been fitting out shop fronts in Melbourne for over 20 years. Contact the reliable service now!