When you’re looking for a new office, a freshly fitted out space can be a tempting option. However, there are many pitfalls to be aware of when you’re considering a “spec” fit-out.
This article outlines the pros and cons of spec fit-outs and explains why bespoke fit-outs are (usually) best.
What’s a spec fit-out?
A spec (speculative) fit-out is a new office fit-out designed to appeal to a range of prospective new tenants. It’s paid for by the landlord (from the new tenant’s incentive pool) and is completed before any tenant commits to the space. All basic requirements are included.
Spec fit-outs are usually aimed at small-medium businesses who need 100 sqm to 1,000 sqm of office space.
In most cases the cost of the spec fit-out is the entire incentive provided by the landlord.
Why landlords do spec fit-outs
Landlords always want to minimise vacancies. A landlord hopes the spec fit-out will be a more attractive option than un-fitted space, and will thus help them to lease their space quickly.
Also, because the fit-out is already completed, a new tenant can move in quickly, so the landlord’s rent downtime is reduced.
Pros & cons of spec fit-outs
The advantages of a spec fit-out are as follows:
What you see is what you get – prospective tenants can “see and touch” exactly what they are getting, which may give them more confidence to make a decision.
Save time & effort – there is no time expended by the tenant in having to work with designers to plan the office layout and pick the finishes.
Relocate quickly – spec fit-outs allow prospective tenants to move offices very quickly – which can be a benefit for start-up businesses that are growing rapidly.
While spec fit-outs do have some benefits, there are some potential pitfalls you need to be aware of:
Compromise or customise – a spec fit-out is by definition a generic fit-out – it’s not custom built for the tenant’s exact business requirements. This means the tenant will either have to compromise on the layout and finishes, or pay for and project manage additional works to customise the office for their needs.
Hidden costs – In a spec fit-out, the tenant has no say on the mechanical, electrical and IT requirements of the space. These “unseen” components are critical for the practical day-to-day running of your office.
Additional power points, data ports, IT cabling, etc. are an added cost for the tenant. Other hidden costs might include supplementary air conditioning and additional sound-proofing.
Diminished value of landlord’s incentive – depending on the market, the cost of the fit-out is usually the entire incentive offered by the landlord. While the valuation may seem reasonable, the fit-out might be over-priced and lacking unseen requirements that will need to be included at extra cost.
Questions to ask about spec fit-outs
If you are considering a spec fit-out, here are some questions to consider, which will help you identify additional costs:
- Does the fit-out truly meet with your future needs, or will it require substantial adjustments?
- Do the meeting rooms/boardroom have supplementary air-conditioning? An enclosed area for more than 6 people needs supplementary air for compliance.
- Will the landlord provide you with more condenser water for the supplementary air?
- Does the data and communications room have an air-conditioner? Not essential if data is cloud based.
- Are the walls built slab-to-slab? This is much better for sound suppression.
- If not (to the above), are the wall cavities insulated for noise suppression?
- Is there sound baffling in the ceilings to contain sound transfer and maintain confidentiality (i.e. from the boardroom or offices)?
- Are the offices sound-proofed?
- Are the workstations and offices hardwired?
- Are there window blinds?
- What are the security features for the office?
Bespoke fit-outs
A bespoke fit-out enables you to choose what is best for your business. You have complete control over the design, decoration, furniture, finishes, mechanical and electrical services, and the budget and timing of the project.
Each company has unique needs in terms of number of enclosed meeting rooms, quiet rooms, boardrooms, size of workstations (sit-to-stand or fixed), break-out areas, collaboration spaces, and IT and audio visual requirements.
A bespoke fit-out helps maximise productivity, comfort and culture to support your businesses now and for the future.
Importantly, a bespoke fit-out gives you total control over all of your landlord’s incentive and your fit-out budget. You can utilise the incentive exactly as you wish, for the best outcome for your business.
Bespoke is best (usually)
In some circumstances, a spec fit-out is the right solution for a business. But from our 20+ years’ experience helping companies relocate offices, we recommend a bespoke fit-out.
Done properly, there are very few disadvantages with a bespoke fit-out, and there are greater benefits to designing your own space for the purpose of your business, and controlling the incentive provided by the landlord.
Just as each business is unique, each office space is unique. Which means there is no one-size-fits-all solution to planning and designing one. Your workspace should be designed to meet the specific needs of your business and employees.
Also, tenants get more “bang-for-their-buck” from designing their own premises – the budget and incentive go further.
How we can help
If you want an office space fitted out to your exact requirement, TRS can help. We have 20+ years of experience in fit-out advisory, undertaking over 300 projects since 2001 – check out our case studies.
TRS will help you to manage and consider your needs, to deliver a design and fit-out aligned to your requirements. We work with you from inception to completion, to ensure your requirements have been met on time and within your budget.
And if you’d prefer a spec fit-out, we can help find the perfect one for your company too.