U.S. Tenant Improvement Allowances Grow • Class A tenant improvement (TI) allowances have been steadily increasing as landlords compete for high-credit tenants, respond to elevated build-out costs and deploy capital to stabilize existing assets. At the same time, occupier expectations have evolved, with greater demand for high-end finishes, collaborative layouts and integrated amenities. These modern workplace environments are more complex and costly to deliver, particularly in newer or repositioned Class A assets. As a result, landlords are offering larger TI packages to align with tenant expectations while preserving headline rents. Performance varies by market; higher TI allowances reflect both intensified competition for quality tenants and the increased cost of delivering today’s premium office space.
• In this environment, securing the right location increasingly depends on strategic workplace investment. Thoughtful design and targeted fit outs can differentiate space, support talent strategies and maximize long-term value in a supply-constrained segment of the market.
Construction Activity Relative to Inventory Square feet under construction as a percent of inventory; select markets in U.S. and Canada
9%
6%
2.6%
Class A Tenant Improvement Allowances Up in 2025
3%
0.4%
0%
10% 15% 20%
$55 $60 $65 $70 $75 $80 $85
$80
0% 5%
2020 Q1
2025 Q4
-10% -5%
Source: Cushman & Wakefield Research; *Austin U/C pipeline off-chart: 2020 Q1 – 12%
YOY (%), RHS
TI Allowances (Trailing 4-Qtr)
Source: Cushman & Wakefield Research
Markets with Largest YOY Increase in Class A TI Allowances (Trailing 4-Qtr)
Vancouver Greater LA San Diego Orlando
208%
41%
37% 38%
9 Markets with >25% YOY Increase
U.S. Average NJ - Northern Washington Tampa Baltimore Orange Co. Raleigh/Durham Santa Clara Boston
33%
28% 31% 31%
25%
17%
9% 10% 11%
Source: Cushman & Wakefield Research
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Cushman & Wakefield
Office Fit Out Cost Guide 2026
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