tenant improvement allowance

Definition

Money the landlord provides for the tenant to customize leased space, typically in commercial properties. It's the 'make yourself at home' budget that determines whether you get new carpet or get to keep the previous tenant's questionable design choices.

Example Usage

The landlord offered a $50 per square foot tenant improvement allowance, enough to cover new flooring, paint, and basic fixtures for the office space.

Origin

Commercial leasing practice from mid-20th century office and retail development

Fun Fact

Tenant improvement allowances are often negotiable and can make the difference between leases, with landlords sometimes offering higher allowances in exchange for longer lease terms.

Source: Commercial leasing standards

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