Are you opening a new retail store, restaurant, office space or medical clinic? Then, you need to understand commercial fit-outs.
A fit-out refers to the process of making an internal space ready for occupation by installing the necessary features and finishes. It often involves a fit-out contractor who provides technical and trade-specific support, ensures compliance with regulations, and contributes to the overall readiness of the space.
A fit-out covers everything from the initial design concept to construction and final touches. As a business owner, you need to get your head around the fit-out process and the costs involved when leasing and renovating a commercial property. Let’s get into it.
Types of Commercial Fit-Outs
The type of fit-out will depend on your business and what you want to achieve with the commercial space. Here are the main categories:
- Retail Shop Fit-Outs: For stores, salons, showrooms, and other retail spaces. This includes customer circulation areas, dressing rooms, service counters, shelving, racks, and visual merchandising displays. An adequate lighting system is crucial for highlighting products and enhancing visual merchandising displays. It is all about presenting products and providing a brand experience.
- Office Fit-Outs: For functional, productive workspaces. Office fit-outs cover workstation layouts, meeting rooms, kitchen and bathroom facilities, ergonomics, technology integration, and brand identity, from small suites to large corporate offices. An adequate lighting system is essential to enhance productivity and ergonomics.
- Hospitality Fit-Outs: For restaurants, cafes, bars and lounges. Food preparation zones, customer seating, bar areas, acoustics and ambience to create a welcoming guest experience.
- Medical Clinic Fit-Outs: These are for healthcare practices. They include patient treatment rooms, consultation spaces, sterilisation facilities, pharmaceutical storage, and medical equipment. Privacy, clinical workflows, and safety compliance are key.
Phases of a Typical Fit-Out Construction Process
Turning a blank shell into a fully operational business space requires careful planning and execution. Most commercial fit-outs – or fit-out projects – go through the following stages:
- Concept & Scoping: Assessing the site, business requirements, budget and timeline, and brand identity and aesthetics. This phase involves the interior architect planning the exact locations of walls and interior separations.
- Design Documentation: Creating floorplans, lighting schemes, power and data plans, joinery drawings and specifying finishes and fixtures.
- Council Approvals: Submitting plans for building permits and compliance with codes and regulations.
- Construction & Fit-Off: This phase involves demolition, building works, services rough-in, and installation of architectural finishes, joinery, and equipment. It also involves the fitting-out process, including installing floors, ceilings, partitions, and furnishings.
- Completion & Handover: Defects, signage and graphics, move-in and training staff to prepare for opening.
How Much Does a Shop Fit-Out Cost? A Comprehensive Price Estimate
Fit-outs are a significant investment for businesses, so you need to understand the key factors that impact the overall cost. A comprehensive price estimate ensures detailed budgeting and avoids financial constraints. These are:
| Cost Driver | Description |
| Size | Total floor area (sqm) |
| Design Complexity | Sophistication of layout and finishes |
| Material Specifications | Quality and performance of selected products |
| Existing Conditions | Suitability of base building services and infrastructure |
| Location | Regional variations in labour and material prices |
| Project Changes | Modifications during construction |
The costs will be project-specific, so consulting a quantity surveyor or cost manager from Duo QS early is recommended to create an accurate budget aligned with your objectives.
How to Quote Your Fit-Out
- Online Cost Calculators: Gives a rough estimate based on generic project parameters like floor area and general quality/complexity assumptions.
- Benchmarking Guides: Published data on average costs per sqm for different cities, fit-out styles and quality levels. For example, the 2023/24 JLL Australia Fit-Out Cost Guide has an average rate of $2,810 per sqm across the country.
- Quantity Surveyor Estimates: Project-specific estimates based on detailed design documentation covering site conditions, space planning, finish schedules, service requirements, and equipment lists.
When planning a commercial fit-out project, it is important to consider business needs and goals to guide strategic design decisions.
Getting multiple quotes from a fit-out company also allows you to compare and see where your budget is being spent. Look for detailed breakdowns, inclusions/exclusions, and consideration of change scenarios.
Comparing quotes from different fit-out contractors is crucial to ensure you get the best value and comply with all regulatory and building codes.
The Secret to Planning A Successful Fit-Out Project
Turning your ideal business space into reality requires careful planning and coordination. Here are some tips to keep your project on track:
- Define your project brief and prioritise the must-haves
- Allow time for design and approvals
- Keep the lines of communication open with your project team
- Have contingencies for changes or delays
- Stage the fit-out if needed to manage cash flow
- Design to accommodate future expansion to align with long-term corporate plans
- Create a functional space that caters to employees’ needs and aligns with the company’s culture
- Consider future business plans to accommodate future growth and long-term corporate plans
- Avoid a poorly done fit-out by ensuring thorough planning and hiring a fit-out expert
If you need assistance traversing through the complexities of fit-outs, work with our cost estimators in Duo QS.
Key Takeaways
- A commercial fit-out is an interior space tailored to your business and brand.
- Fit-outs are for retail, office, hospitality and medical sectors, each with its own challenges.
- The fit-out process has concept scoping, design development, approvals, construction and handover phases.
- Size, design complexity, material specs, site conditions, location and changes can impact costs.
- Current rates are $2,200 – $3,200+ per sqm but can vary greatly depending on the project.
- Accurate budgeting requires estimates from quantity surveyors and fit-out contractors.
- Planning, communication and the right team are key to success.
FAQs
What is a commercial fit-out?
A retail shop fit-out is a good example. This is where we outfit the interior space of a store. This can include shelving, changing rooms, counters, flooring, lighting, signage, and decor that brings the brand to life. The specifics will vary depending on the type of business, e.g., fashion boutique vs. supermarket.
What are my responsibilities during a fit-out?
As a tenant, you are considered the “principal contractor” legally responsible for the fit-out construction. This means managing the project, ensuring contractors comply with work health and safety regulations and communicating the fit-out plans and specifications to the team. You can sometimes pass this role on to your head contractor.
Can I claim depreciation on my fit-out?
Yes, the ATO allows commercial tenants to claim depreciation on certain capital expenses related to fitting out a leased space. Eligible assets you install may include light fittings, floor coverings, air conditioning, and cabinetry, but not structural assets belonging to the landlord, like lifts or fire systems.
How long does a fit-out take?
It depends on the size and complexity of the project. A small basic fit-out may take 3-4 weeks, and a 1000sqm office may take 3-6 months. Design changes, council approvals and material lead times all impact the timeframe. Talk to your fit-out partner to get a realistic estimate.