Help with commercial property fit out costs

[danni_behr]

Hello!

Completely new to UKBF but i'm finding all of these threads super useful
I was hoping someone might be able to advise me on the cost of creating a commercial space.

I'm currently working on a business plan for a potential new business, including an in depth budget, and the fit out costs of the space really have me stumped as i haven't done anything like this before.

I'd like to create a co-working space so as well as some nice furniture it's likely the space i rent will need some kitchen facilities added, potentially even a few meeting rooms created. The look and feel of the space will be vital to it's success so medium to high end finishes in terms of lighting, textural wall finishes etc will be key.

My ask to the community are as follows:

1. How can i estimate the cost of the works needing to be completed? (Just a ball-park at this stage as i'm still looking into whether the business is viable; i wouldn't want to bother any contractors currently as i don't have enough detail for them.)
2. Does anyone have any top-tips in finding reliable/ quality contractors to do the work? I've never done anything commercially before but have recently built a house and did unfortunately experience a few tradesmen that had over estimated their own abilities (if that's a nice way to put it).
3. From your experience is it worth paying a big company to fully design the space and help source furnishings or does the cost mean it's better to do it yourself?
4. Lastly (potentially silly question) but what is the norm in terms of landlords allowing you to make these sorts of changes to their buildings? I understand i'll probably be signing a lease for 5 years; is it just a case that as long as i agree to put it back to how it was (if they so wish) at the end of the tenancy that's fine or would some be against things like kitchen facilities being added?

A few additional details:

• I'm in the north of England, not in a large city so i expect that could affect costs.
• I'm creating a few different budgets based on different size spaces. Currently 4,468 square feet, 2,297 sqf or 1,552 sqf.

Thank you for any guidance or wisdom!

 

[fisicx]

@Mark T Jones is the right man to answer your questions.

 

[Mark T Jones]

Thank you for the tag @fisicx

@danni_behr , whilst I'm not at the sharp end, I do deal with fit outs as part of my business.

Your questions are all very much 'piece of string ' and highlight the need to engage professionals early on.

Step by step:

1. Whilst there are 'cost per metre' figures avaliable, there are too many variables for them to be at all reliable. Not least, the start point vs the end point

Over time/over budget is pretty much a mantra - how much over is largely down to how much research you put in and the quality of your specification.

Rule of thumb - listed buildings are a nightmare, new builds are easy.

2. I know several contractors who specialise in this field. Geography, budget and the size/nature of the project are key factors.

3. The minimum you need is an experienced project manager. You also need a good surveyor and specialist legal advice before you sign anything

4 it depends. Some landlords will work with you - even chip in with costs. Others will be obstructive

 

[WaveJumper]

Or as above in No 4 landlord not at all happy you're making significant changes to his building. Unless of course you are going to purchase the site yourself if not what sort of lease are you looking at ie length.

I would also suggest the landlord (and back in the day we certainly would have) would want to see full detailed plans, specifications etc. If creating new areas / rooms you will need to consider a fire risk assessment / survey. Again landlord and even building control will want to know if additional fire escape routes are required etc etc

I would certainly go with the advice from Mark get a professional in to advice and have plans drawn up that you can then have properly costed and approved

And of course it goes without saying get proper legal advice

 

[martin_shl]

It depends a bit on the space you select. While I have never done this in business, when I was in the Civil Service, I specified the requirements for and oversaw the conversion of part of our office space into additional meeting rooms. As this was a modern office it had both suspended floors and ceilings so it was easy to put in floor boxes, projectors, speakers and wall terminals as well as fit new modular wall panels and doors.
As others have said, the key is getting the specification right. Amongst my many technical skills, I am a trained and experienced IT business analyst, so I was able to apply those transferable skills getting the detail of what we needed and working with the contractor to define clear specifications and acceptance criteria; I then served as the project manager liaising with building management to ensure they had access when needed. It wasn't cheap but it didn't take too long and we ultimately got some very useful and flexible space going forward. (NOTE - I've stuck with IT)

You will have a vision for the kind of building you are after and that may have a significant bearing on how much it costs, how long it takes, and how much uncertainty there is in the costs and time. As others have said, finding good professionals to help in both the planning and delivery will be the best way forward.

 

[mehmetyoney]

I am an architect, and I have experience designing office spaces in Turkey. I have worked on two office redesign projects for Koç Holding, a globally recognized company. These projects focused on redesigning existing office spaces to meet modern needs. The workflow we followed for these projects was as follows:

1. Identifying the Needs of the Office:
   We began by analyzing the specific requirements of the office, such as workspace needs, meeting areas, executive offices, hygiene requirements, and more. This step ensures a clear understanding of what the office requires to function efficiently.
2. Developing an Architectural Solution Based on These Needs:
   The design process was guided by the hierarchy of needs. For instance, we wouldn’t allocate a large office to a CEO who is rarely on-site, as that space could be better utilized for other purposes. Throughout the design phase, there were many decisions to be made, and these decisions were prioritized based on the hierarchical importance of the needs.
3. Determining Material Quantities:
   Once the architectural design was finalized, the materials required for the project were calculated. This is a critical step that your appointed architect will handle for you.
4. Estimating Material Costs:
   At this stage, it’s essential to consider what matters most to you. For example, there can be significant price variations between brands offering the same type of material. Deciding on materials requires balancing quality and budget.
5. Creating a Work Plan:
   Developing a Gantt chart or similar timeline ensures an organized approach. This plan allows you to estimate how many workers will be needed and how long the construction phase will take. From this, you can calculate approximate labor costs based on daily wages.
6. Requesting Bids from Contractors:
   In the final step, you’ll invite bids from contracting firms to execute the project. It is essential to provide detailed information, including the project plan, material specifications, quantities, expected completion time, and the quality standards for workmanship. This level of detail helps ensure the contractor delivers the desired results within the agreed timeline and budget.

This process ensures you achieve the office space you envision, at the desired quality level, and within the projected timeline. It also helps prevent potential disagreements during the project.

Since I have worked in Turkey, my advice is based on the practices and standards I’ve encountered here. However, I understand that England has its own set of legal requirements and standards, such as fire safety, lighting regulations, and noise control standards. From what I’ve heard, these regulations are often more stringent than those in Turkey. Therefore, you should pay special attention to compliance with local rules. If your project doesn’t adhere to government standards, you could face significant penalties that may exceed the cost of hiring a professional to guide you through the process.

By keeping these steps and considerations in mind, you can ensure a smooth project execution and an office space that meets both your needs and legal standards.

I would be happy to assist you with any other needs you may have.

 

[danni_behr]

@Mark T Jones is the right man to answer your questions.

Thank you for linking Mark!

 

[danni_behr]

Thank you for the tag @fisicx

@danni_behr , whilst I'm not at the sharp end, I do deal with fit outs as part of my business.

Your questions are all very much 'piece of string ' and highlight the need to engage professionals early on.

Step by step:

1. Whilst there are 'cost per metre' figures avaliable, there are too many variables for them to be at all reliable. Not least, the start point vs the end point

Over time/over budget is pretty much a mantra - how much over is largely down to how much research you put in and the quality of your specification.

Rule of thumb - listed buildings are a nightmare, new builds are easy.

2. I know several contractors who specialise in this field. Geography, budget and the size/nature of the project are key factors.

3. The minimum you need is an experienced project manager. You also need a good surveyor and specialist legal advice before you sign anything

4 it depends. Some landlords will work with you - even chip in with costs. Others will be obstructive

@Mark T Jones thank you so much for your reply. It's definitely given me a lot to think about. I just don't understand how anyone runs the numbers to find out if starting a new business is viable before engaging lawyers/ project managers/ interior architects etc etc.

 

[danni_behr]

Or as above in No 4 landlord not at all happy you're making significant changes to his building. Unless of course you are going to purchase the site yourself if not what sort of lease are you looking at ie length.

I would also suggest the landlord (and back in the day we certainly would have) would want to see full detailed plans, specifications etc. If creating new areas / rooms you will need to consider a fire risk assessment / survey. Again landlord and even building control will want to know if additional fire escape routes are required etc etc

I would certainly go with the advice from Mark get a professional in to advice and have plans drawn up that you can then have properly costed and approved

And of course it goes without saying get proper legal advice

Thanks @WaveJumper fortunately H&S is the one area i am confident in as this is what my husband does. It's very interesting (and now you've said it, it makes total sense) that a landlord would want to see plans before agreeing. It makes me think that by the time i've done all the plans/ legal work etc someone else could have jumped in and leased the property before me. I guess that's the game though.

 

[danni_behr]

It depends a bit on the space you select. While I have never done this in business, when I was in the Civil Service, I specified the requirements for and oversaw the conversion of part of our office space into additional meeting rooms. As this was a modern office it had both suspended floors and ceilings so it was easy to put in floor boxes, projectors, speakers and wall terminals as well as fit new modular wall panels and doors.
As others have said, the key is getting the specification right. Amongst my many technical skills, I am a trained and experienced IT business analyst, so I was able to apply those transferable skills getting the detail of what we needed and working with the contractor to define clear specifications and acceptance criteria; I then served as the project manager liaising with building management to ensure they had access when needed. It wasn't cheap but it didn't take too long and we ultimately got some very useful and flexible space going forward. (NOTE - I've stuck with IT)

You will have a vision for the kind of building you are after and that may have a significant bearing on how much it costs, how long it takes, and how much uncertainty there is in the costs and time. As others have said, finding good professionals to help in both the planning and delivery will be the best way forward.

Thanks @martin_shl it sounds like the building you were working on was much larger than anything i would be trying to take on; but your point is absolutely valid- if i can get the specifics nailed at the start i guess i can be clear with any contractors i'm engaging.

 

[Mark T Jones]

@Mark T Jones thank you so much for your reply. It's definitely given me a lot to think about. I just don't understand how anyone runs the numbers to find out if starting a new business is viable before engaging lawyers/ project managers/ interior architects etc etc.

It's a tough one. Unfortunately a lot of my customers open their doors far later and far poorer that planned - this even happens to experienced ones, but mostly to novices.

One start point is to find a dummy property on the market - one you may not offer on but which meets your broad needs & use it as a model.

Also get talking to some fit out contractors in your area (most of my connections are in the south). Discuss variables & challenges rather than 'best' figures.

Not sure if I mentioned it, but the biggest & most pointless cause of over-runs is continuous changed mid build ('Can you just...?)

 

[danni_behr]

I am an architect, and I have experience designing office spaces in Turkey. I have worked on two office redesign projects for Koç Holding, a globally recognized company. These projects focused on redesigning existing office spaces to meet modern needs. The workflow we followed for these projects was as follows:

1. Identifying the Needs of the Office:
   We began by analyzing the specific requirements of the office, such as workspace needs, meeting areas, executive offices, hygiene requirements, and more. This step ensures a clear understanding of what the office requires to function efficiently.
2. Developing an Architectural Solution Based on These Needs:
   The design process was guided by the hierarchy of needs. For instance, we wouldn’t allocate a large office to a CEO who is rarely on-site, as that space could be better utilized for other purposes. Throughout the design phase, there were many decisions to be made, and these decisions were prioritized based on the hierarchical importance of the needs.
3. Determining Material Quantities:
   Once the architectural design was finalized, the materials required for the project were calculated. This is a critical step that your appointed architect will handle for you.
4. Estimating Material Costs:
   At this stage, it’s essential to consider what matters most to you. For example, there can be significant price variations between brands offering the same type of material. Deciding on materials requires balancing quality and budget.
5. Creating a Work Plan:
   Developing a Gantt chart or similar timeline ensures an organized approach. This plan allows you to estimate how many workers will be needed and how long the construction phase will take. From this, you can calculate approximate labor costs based on daily wages.
6. Requesting Bids from Contractors:
   In the final step, you’ll invite bids from contracting firms to execute the project. It is essential to provide detailed information, including the project plan, material specifications, quantities, expected completion time, and the quality standards for workmanship. This level of detail helps ensure the contractor delivers the desired results within the agreed timeline and budget.

This process ensures you achieve the office space you envision, at the desired quality level, and within the projected timeline. It also helps prevent potential disagreements during the project.

Since I have worked in Turkey, my advice is based on the practices and standards I’ve encountered here. However, I understand that England has its own set of legal requirements and standards, such as fire safety, lighting regulations, and noise control standards. From what I’ve heard, these regulations are often more stringent than those in Turkey. Therefore, you should pay special attention to compliance with local rules. If your project doesn’t adhere to government standards, you could face significant penalties that may exceed the cost of hiring a professional to guide you through the process.

By keeping these steps and considerations in mind, you can ensure a smooth project execution and an office space that meets both your needs and legal standards.

I would be happy to assist you with any other needs you may have.

Thank you @mehmetyoney. This detailed workflow is very helpful. At this stage i'm trying to work out if the business is even viable to start so i don't know how i get indicative costs without going through all the above steps and committing to a property that might not work (i'd only know one the plans were drawn surely) or get quotes that make starting the business not financially viable.

 

[danni_behr]

It's a tough one. Unfortunately a lot of my customers open their doors far later and far poorer that planned - this even happens to experienced ones, but mostly to novices.

One start point is to find a dummy property on the market - one you may not offer on but which meets your broad needs & use it as a model.

Also get talking to some fit out contractors in your area (most of my connections are in the south). Discuss variables & challenges rather than 'best' figures.

Not sure if I mentioned it, but the biggest & most pointless cause of over-runs is continuous changed mid build ('Can you just...?)

@Mark T Jones thanks, i think you're right, i need to speak to some people to get a better understanding Initially i didn't want to bother anyone with something i wasn't sure would turn into anything but i guess if they want the potential future business hopefully they'll be up for a chat. Thank you again!

 

[HFE Signs]

If you need any help with Signage costs, we have online calculators

 

[danni_behr]

If you need any help with Signage costs, we have online calculators

Brilliant, thanks @HFE Signs

 

[HFE Signs]

Brilliant, thanks @HFE Signs

We'd be delighted to help

 

[Paul Kelly ICHYB]

medium to high end finishes in terms of lighting, textural wall finishes etc will be key.

Everything will depend on your budget.

Having costed these things out before, always consider:

• What You want
• What you need
• What you can afford.

Look at the competition on your area and understand their costs. You can then look at the potential turnover (always calculate at 50-70% occupancy unless there is very high demand and a lack of competition - even then be cautious).

Understand your target client - are they going to be .com startups or the local accountant, virtual assistant etc.

Consider used furniture/fittings.

 

[danni_behr]

Everything will depend on your budget.

Having costed these things out before, always consider:

• What You want
• What you need
• What you can afford.

Look at the competition on your area and understand their costs. You can then look at the potential turnover (always calculate at 50-70% occupancy unless there is very high demand and a lack of competition - even then be cautious).

Understand your target client - are they going to be .com startups or the local accountant, virtual assistant etc.

Consider used furniture/fittings.

Thanks @Paul Kelly ICHYB the advice on occupancy is very helpful as i'd really been struggling to forecast this. The closest competitors are an hour away so i would have a good corner on the market here if i can make it work

 

[Mark T Jones]

@Mark T Jones thanks, i think you're right, i need to speak to some people to get a better understanding Initially i didn't want to bother anyone with something i wasn't sure would turn into anything but i guess if they want the potential future business hopefully they'll be up for a chat. Thank you again!

It all starts somewhere...

In truth if they are open and generous at this point, they will probably be a good partner for your first project. You might even consider putting them on a retainer when you are sure that you plan to go ahead.

Whilst my knowledge is outside the technical, I can give you the benefit of some customer experiences - warts and all - if you drop me a DM

 

[danni_behr]

It all starts somewhere...

In truth if they are open and generous at this point, they will probably be a good partner for your first project. You might even consider putting them on a retainer when you are sure that you plan to go ahead.

Whilst my knowledge is outside the technical, I can give you the benefit of some customer experiences - warts and all - if you drop me a DM

Thank you @Mark T Jones that's really kind. If we decide to move forward i will absolutely drop you a message

 

[GraemeL]

Hello @danni_behr . The way your opening post reads to me is that you are starting a new business (so have no income stream) and are considering renting premises (so you are agreeing to a lease of some kind) and intend to fit them out (fit out costs rarely recovered when vacating rented premises) to a high spec.

If I have all that that right, it's an enormous up front cost and ongoing risk. Have you so much confidence in your income stream that you can take that risk?

While it might mean your short term profitability is damaged, I would seriously suggest to you that you consider serviced offices until you can demonstrate a secure income.

 

[Mark T Jones]

Hello @danni_behr . The way your opening post reads to me is that you are starting a new business (so have no income stream) and are considering renting premises (so you are agreeing to a lease of some kind) and intend to fit them out (fit out costs rarely recovered when vacating rented premises) to a high spec.

If I have all that that right, it's an enormous up front cost and ongoing risk. Have you so much confidence in your income stream that you can take that risk?

While it might mean your short term profitability is damaged, I would seriously suggest to you that you consider serviced offices until you can demonstrate a secure income.

The OP is setting up serviced offices.

 

[Chris Ashdown]

Have you talked to the local planning office at your town hall, they have a big say on what you can do on a site

 

[danni_behr]

Have you talked to the local planning office at your town hall, they have a big say on what you can do on a site

Thanks @Chris Ashdown at the moment i'm just trying to build a budget to help make a decision about whether this new business is a viable venture. Without actual properties in mind and a proper drive to make the idea a reality i don't want to get too far into planning advice etc.
It is an excellent next step though!

 

[martin_shl]

Thanks @martin_shl it sounds like the building you were working on was much larger than anything i would be trying to take on; but your point is absolutely valid- if i can get the specifics nailed at the start i guess i can be clear with any contractors i'm engaging.

We only had one floor in this building, so it was quite small in reality. If there are suitable buildings then often you can lease part of a floor which could give you the big building infrastructure flexibilities on a smaller scale.

 

[danni_behr]

We only had one floor in this building, so it was quite small in reality. If there are suitable buildings then often you can lease part of a floor which could give you the big building infrastructure flexibilities on a smaller scale.

That's good to know, Thanks @martin_shl

 

[BloomProjects]

Hi @danni_behr ... I am a Fit-Out Specialist.

I would be happy to assist you. The Bloom Projects team have designed and built various serviced office locations, including for The Office Group. Our latest office project is 4k ft2 HQ for a financial powerhouse, with everything being 'value engineered', so to get best pricing whilst simplifying the specification of materials, with no drop in quality.