Tenant improvement allowances in Palm Beach County: how TI really works

The TI allowance is the most negotiated line in a commercial lease after rent - and the one tenants most often accept without knowing what the build-out actually costs.

What a TI allowance is

Money the landlord contributes toward building out your space, quoted per square foot. It is priced into your rent and term: a higher allowance on a longer term is a financing decision, not generosity.

Typical Palm Beach County ranges (directional, 2026)

Institutional landlords downtown negotiate from detailed work letters - the allowance number matters less than what it covers. Read the exclusions.

The gap is what you actually negotiate

If your build-out prices at $100/sf and the allowance is $50/sf, you fund $50/sf - $300,000 on 6,000 sf. That number, not the allowance, decides whether the lease works. A contractor's budget range belongs in the letter-of-intent stage, before your leverage disappears at signing.

How landlords pay it - and what to watch

• Turnkey: the landlord's contractor builds to an agreed scope. Simple, but you inherit the landlord's cost control. Define the scope exhaustively.
• Allowance with your contractor: you run the job and draw against invoices. Better control; confirm the draw documentation and lien-release requirements up front.
• Amortized allowance: extra TI folded into rent. Check the implied interest rate.

Watch for: exclusions of soft costs (design, permits, low-voltage), disbursement only at completion, and expiration dates on unused allowance.

The negotiation sequence that works

• Get a real budget range before the LOI. We do this in 48 hours.
• Put the TI number, disbursement method, and eligible costs in the LOI, not just the lease.
• If TI will not move, trade for free rent during build-out - it lands in exactly the months you are spending on construction.