Tenant Improvement Allowance Calculator Pro (USA)
Estimate your build-out costs and landlord contribution instantly.
Understanding Tenant Improvement (TI) Allowance
A Tenant Improvement Allowance (TI) is a specific amount of money that a landlord agrees to spend on improvements or renovations to a rental space. In the USA commercial real estate market, this is a standard part of lease negotiations.
How to use this Calculator?
This tool helps tenants and brokers quickly determine if the landlord’s offer covers the actual cost of the build-out.
- Step 1: Enter the total square footage of the lease.
- Step 2: Enter the TI Allowance rate offered by the landlord (e.g., $20/sq ft).
- Step 3: Enter your contractor’s estimated cost per square foot.
- Result: The calculator shows the total funding available and the “Overage” (the amount you must pay out of pocket) or “Underage” (potential savings).
Frequently Asked Questions (FAQ)
Is the TI Allowance given to me as cash?
Usually, no. The landlord typically reimburses the tenant for actual construction costs incurred, or pays the contractors directly based on approved invoices. It is rarely a cash upfront payment.
What happens if construction costs exceed the allowance?
If the costs go over the TI Allowance (an “Overage”), the tenant is responsible for paying the difference. This can be paid upfront or amortized into the rent, depending on the lease agreement.
What is the average TI Allowance in the USA?
It varies significantly by market and building class. For “Shell” buildings, allowances might be higher ($10-$30+), while “2nd Generation” spaces (already built out) might be lower ($5-$15).
