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Tenant improvement allowances increasing in line with rising construction costs

  • ​Tenant improvement allowances in the City have increased 26.7 percent from 2016 to an average $54.02 psf (on direct 20,000 square foot + deals of 5 years or longer).
  • Concurrently, construction indexes have risen 24.0 percent since 2010, a function of increased development creating a tight labor market and causing the cost of materials to escalate.
  • Efforts to attract tenants to lease second generation traditional space,  deals on new construction with large allowances, and increasing construction costs have all impacted average improvement packages across the City. TIs are unlikely to increase much further, but should stay at current levels in the near to mid term.​​

Source: JLL Research

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