How to Prepare for Construction In An Occupied Space

When tenants are determining their next office lease, they are quickly faced with this question: Should I Stay or Should I Go? There are a variety of factors to be considered for each option:

  • tenant improvement allowance
  • rent rate
  • rent abatement
  • building amenities
  • building location
  • available lease space

Evaluating each factor can be overwhelming for someone who isn’t entrenched in the Chicago real estate market. The best way to evaluate these factors is to hire a tenant representation broker. The broker will guide you through the negotiation process, ultimately helping you decide ‘To Stay’ or ‘To Go’. From the perspective of capital improvement costs, the choice to ‘Stay’ is commonly perceived as the low-hanging fruit. By maintaining the existing layout, costs for demolition, new partitions, electrical infrastructure, HVAC systems, plumbing elevations, and fire sprinklers are avoided. This leaves the majority of the tenant’s budget for the more-desired architectural improvements.

With all this in mind, the decision to ‘Stay’ is directly correlated with the decision to accept your current office space as an active construction zone. This is no less intrusive as if it were your own home! The diffusion of noise, dust, and smells are among the many reasons that construction affects the comfort of employees. Any element that impacts employee productivity can be viewed as a threat against the efficiency and profitability of a business.

I recommend engaging a general contractor during the design phase but believe that it is imperative when planning work within an occupied space. General contractors offer a practical perspective to help the client understand the impact that construction will have on employees. It also helps the contractor understand the tolerances of the employee and business functions.

The preconstruction phase is the Project Manager’s version of ‘Measure Twice, Cut Once”. By establishing phasing plans, swing spaces, work hours, and the overall project scope and schedule; we’ll help save both time and money. The goal is not to ‘hurry up and start’; rather, it’s to have a plan to finish. The preconstruction phase is your greatest risk management tool to establish expectations for a project, which will ultimately lead to its overall success. During the preconstruction phase, the dialogue among the project stakeholders helps reveal any potential exposures. Some questions to be discussed include:

  1. When was the previous build-out completed? Are there as-built drawings available?
  2. How tolerable are your employees to noise? Are there specific areas, departments, or people?
  3. What are the typical work hours for your employees? Are they able to work from home?
  4. Are there areas of restricted access? Will an employee-escort be needed for any areas?
  5. Are there high-priority areas or systems that cannot be shutdown or will need minimal closures?
  6. Are there any upcoming company events that will need certain areas completed?

In our recent renovation of a trading firm at 550 W Jackson, we extensively reviewed multiple schedules and phasing plans during the preconstruction phase. It was important that the client was aware of when employee workstations would need to be shutdown and when any disruptive work would take place. The potential interruption to an active trader would put thousands of dollars on the line – literally! Thanks to extensive communication throughout preconstruction and the duration of the buildout, we successfully completed the renovation on time, on-budget, and without issue. The true mark of a successful project comes when the client names a conference room in honor of the project superintendent!

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