What would be considered a reasonable allowance for flooring when negotiating a lease with tenants?

The location has carpet but needs to be replaced/or cleaned. We would like to offer an allowance when negotiating.
In Leasing Property - Asked by craig p. - Nov 24, 2009
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Answer(s)

Jim T.
Owner/Investor
Abilene, TX

I usually figure 2-4 dollars per square foot, depending on the type of carpet and how cheaply I can get it and get it installed. If the carpet is less than 5 years old, there's no reason to replace it unless it's just incredibly worn, and cleaning it should be pennies compared to the lease itself.

Nov 24, 2009
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Larry K.
Owner/Investor
Mahwah, NJ

Depending on your area, about $3 to $4 per square foot. In my area carpet is priced by the square yard. You'll need to divide the carpet cost of say 30/yd by 9 to get to 3.33 per foot. Remember floor prep (flash patch) and base.

Nov 25, 2009
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Ron B.
Broker/Agent
Denton, TX

Varies greatly. First - you need to know what appropriate quality carpet + installation costs would be for your area and your property. Call a flooring contractor and KNOW what such flooring costs. Depends on the type / quality - carpet / vinyl / wood / ceramic, etc. - which will vary from property to property and tenant to tenant and the use of the property - ie: office, retail, medical, industrial. Depends too on if a new tenant - or a renewal and - of course - condition of the carpet / flooring. Also important is the term of the lease - whether new or renewal. $1.50/SF = $13.50/SQ YD. Again - get a quote from a flooring contractor you know and trust and be knowledgeable. Don't forget labor / cove base, etc. You have to include whether you are getting an increase in rents if a renewal and what your occupancy / vacancy factor is in the rest of the property. Is this a good tenant? If existing tenant - and you don't come to terms - will the tenant move out and you have to replace the flooring for a new tenant .... then you want to make a deal with the tenant you have for sure. Once you know what the costs are - and term of the lease (how long will you expect the tenant to be there to amortize the costs) then strike a deal for new flooring - in whole or in part. All negotiable. Scott Brown Commercial RE, Denton, TX

Dec 1, 2009
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Gregory G.
Broker/Agent
San Francisco, CA

$2-$4 a foot.
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Gregory Garver - Commercial Real Estate Broker
Broker License# 01716531
(415)225-9894
gregory.garver@gmail.com
Web Reference: http://www.gregorygarver.com

Dec 3, 2009
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