The cost of shop fitouts in Canberra has been in a fast pace in recent years and has outpaced allowances for tenant improvements. According to a recent report by JLL, the average cost of ashop outfit has increased by 12% last year. The increase is due to the combination of increased strong demand for shop spaces and the rising costs of labour and materials.
While tenant improvement allowances have increased in 2018 by 13%, it is enough to completely offset cost growth. Total construction costs have increased in 2018 with 60% off setting the increases in tenant improvement allowances. The remaining 40% has to be passed on to the tenants. Increase in costs is expected to continue in 2019 but JLL predicts that it will be in a more moderate pace compared to last year. The cost of materials is expected to remain close to current levels but the shortage of qualified construction labour will also continue.
Many tenants from industries like consumer electronics and fashion want to update their spaces every year or two. This trend is expected to become a challenge because the cost of shop fitouts will continue to rise. JLL has compiled the costs of different types of floor plans to provide tenants with an idea on how much investment will be needed.
The progressive open-shop floor plan has 100% bench-style seating without enclosed shops. Design will include various spaces for collaboration and conferences. If space will be designed on low cost budget with finishes focused on function and aesthetics including basic technology, the estimated coast is about $147 per square foot.
If the project is more complex with upgraded lighting, cabling and design features using average quality materials and details, the estimated cost is $170 per square foot. If top quality finishes and space improvements are required with increased efforts on aesthetics and detail design, the estimated cost is $193 per square foot.
Many factors come into play in custom designed shop fitouts in Canberra based on the nature of the business and its requirements. Some businesses want to showcase their shop for their customers while others prefer to focus on function. Designers are prepared to help clients in design concepts and themes.