Page 16
— Retail Properties Quarterly — August 2016
Y
ou’re looking for a space to
bring your clients’ hopes,
dreams and intricate plans
to fruition. The question is,
how do you help them select
a space to best suit their needs? I’ve
worked as an estimator for local gen-
eral contractors for the last 10 years,
and I’ve priced projects that range
from $60 per square foot to well over
$400 per sf. Each project posed its
own complications, solutions and
lessons learned.
In order to accomplish your cli-
ent’s ultimate goal – finding a space
that meets its needs and is within
its budget – the most basic decision
you’ll need to make is what type of
space to procure: new build, historic,
existing tenant space or build-to-
suit.
n
The new build.
Residential con-
struction is booming in Denver and
with that comes a plethora of new
commercial space for new business
location. However, costs for moving
into a previously unoccupied, newly
built space can be more extensive
than initially anticipated because
new buildings often are only the
building envelope. Once the client
occupies the space, he is responsible
for constructing the demising walls
(walls that are full height, fire rated
and sound rated) at the perimeter of
the space.
Often, new commercial spaces do
not have the entirety of the interior
concrete floor slab placed. A space
that will house a restroom, kitchen
or any facility that requires water
greatly improves the customization
options because of the freedom to
run the underground drainage at any
desired location for
a fraction of the
cost of customizing
a vacated space.
For example, a
project I worked
on involved the
installation of a
commercial kitchen
and two restrooms
in a 2,300-sf new
tenant space. We
placed the entirety
of the underground
plumbing and the
concrete slab with-
in three working days. If this had
been a previously occupied, vacated
space, the project would have
entailed demolition of the exist-
ing slab and existing underground
plumbing, installation of new plumb-
ing and replacement of the concrete
slab, taking anywhere from six to 10
working days to complete, as well as
adding the cost of demolition.
Another thing to keep in mind is
that the placement of a concrete
slab often is reimbursable to the ten-
ant by the building owner as part of
the tenant lease when one doesn’t
already exist, whereas removing and
replacing an existing slab is harder
to negotiate.
Heating, ventilation and air con-
ditioning also are benefits to a new-
build site because the tenant will be
provided with new equipment that
is highly efficient and clean. Your
client avoids the cost of cleaning an
existing system or upgrading exist-
ing equipment to meet its needs.
If, however, it requires HVAC that is
above-typical standards, it may still
have to add additional units or nego-
tiate an upgrade.
Overall, a new site is one of the
best opportunities to have a clean,
customizable space.
n
The historic classic.
These are
some of my favorite construction
projects: diving into a space filled
with character, quirks and the local
community. As much as these
buildings are full of amazing quali-
ties, often these same qualities can
become real challenges.
Older buildings, in particular those
constructed prior to 1979, may con-
tain hazardous materials from the
original construction, such as asbes-
tos or leaded paint. If the space con-
templated has hazardous materials,
you must factor the cost and time
commitment for the remediation
into the decision.
Other concerns with older build-
ings can be the structure, founda-
tion, and mechanical and electrical
systems. Closely evaluate the foun-
dation and structure of the space
your client is considering. The meth-
ods used in the early 20th century
to make concrete and mortar are
nowhere near the level of quality
you see in today’s materials, so it’s
important to ensure the foundation
is sound and undamaged.
Start with a visual inspection of
any brick or stone veneers above
the foundation to confirm the mor-
tar binding the blocks isn’t failing.
Repairs to the foundation and build-
ing envelope should be completed
prior to occupation of the building to
protect the investment made in the
space. The mechanical and electrical
system also should be inspected.
To meet the current construction
code in Denver, as well as several of
Denver’s suburban cities, highly effi-
cient HVAC and lighting is required.
To meet the newly adopted code,
you’ll most likely have to upgrade
or replace the existing HVAC and
lighting systems. The electrical and
plumbing infrastructure should be
inspected because modern wiring
and plumbing should be installed in
the space prior to taking occupancy.
If you see any outlets that lack a
ground plug, water supply piping
that isn’t copper or plastic, or lead
drainage piping, the presence of
these items should raise a red flag.
Upgrading the building envelope to
make the space thermally efficient is
another consideration. Replacing old
windows with more energy-efficient
options and adding insulation to the
walls are a couple improvements
that have a fairly quick return on the
investment simply by lowering the
cost of heating and cooling. If the
building is protected due to histori-
cal significance, the replacement of
items such as windows becomes a
bit more difficult and costly, but not
impossible.
n
Existing and move-in ready.
This
usually is the most economical
option for your retail client. Often
these suites possess the layout and
finish materials left in place by the
previous tenant. Considering that
the vision is almost never the same
as that of the previous tenant, your
client always should plan to remove
and/or move the interior walls, ceil-
ing and flooring.
With this in mind, a major issue
that often is overlooked concerns
Darrenn Call
Senior estimator,
on-call division,
Haselden
Construction,
Centennial
Broker Insights
