Restoration & Construction

Restoration to original condition and interior construction

To avoid problems relating to restoration to original condition, check the scope and conditions for restoration to original condition

When leasing space in an office building, the tenant, at the time of termination of the lease, is usually obligated to restore the leased premises to the original condition. Generally, painting the walls and ceilings and re-laying of flooring material is conducted at the tenant’s expense. Issues concerning restoration to original condition are usually put off as “a matter to be dealt with when vacating,” but it is essential to think of these as issues to be dealt with when moving in to avoid later problems.

Most problems concerning restoration to original condition are caused by differences in perception between the landlord and tenant concerning the scope of duty of restoration to original condition. To avoid problems, when moving into new space, it is necessary to check for wear and tear and otherwise confirm the condition of the property, and to check the content of the lease agreement concerning the scope of restoration to original condition.

Designated contractors and construction work classification table

Confirm whether there are designated contractors that must be used for construction work and check the construction work classification table

Determining the cost of restoration to original condition and interior construction work in advance is extremely important. A major factor in determining the cost of restoration to original condition is the selection of contractors. In many cases, however, the landlord designates contractors that must be used for the construction work to restore the leased premises to their original condition, and the costs they charge greatly exceed the amount originally budgeted by the tenant. Thus it is advisable to confirm whether designated contractors must be used for the restoration to original condition. Also, in many cases, contractors designated by the landlord must be used for interior construction and communications-related construction in the new offices. However, there are generally arrangements concerning the scope of construction work to be performed by the designated contractors at the new offices. For example, interior construction work is performed by the tenant, and the tenant may be able to select the contractors at its own discretion. These types of matters can be confirmed in the construction work classification table. It is important to confirm whether designated contractors must be used and the content of the construction work classification table.

Relocation expenses

Calculate relocation expenses based on 150,000 yen to 200,000 yen per tsubo

Tenants have a tendency to make estimates for relocation expenses that are far below the actual expenses. The amounts below can be used to make a general estimate.

Expenses for restoration to original condition + Interior construction and communications-related construction work = 150,000 yen to 200,000 yen per tsubo

* The above assumes that the leased space floor area is the same before and after relocation.

* Half of the estimated expenses are for restoration to original condition and the remainder is for interior construction and communications-related construction work and relocation expenses.