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Fit-out

The term "fit-out" is used in the commercial real estate industry to describe the process of finishing and customizing the interior of a building according to the needs of a tenant.

Fit-out can involve various aspects such as the installation of lighting, air conditioning systems, floor coverings, painting and decoration, installation of office partitions, and possibly the equipment of kitchen and social areas.

During lease negotiations, a degree of fit-out to be carried out by the landlord can be agreed upon. Sometimes the landlord provides space in a "shell & core" state (basic structure without interior finishes), where the tenant must undertake all the fit-out. In other cases, the landlord may provide a "turn-key" space (space fitted out to the tenant's specifications), which means all fit-out work is completed before the tenant moves in.

It can also be agreed that the landlord will provide a "fit-out contribution," which is a certain amount to be used for the customization of the space according to the tenant's needs. This contribution can be provided as part of the lease agreement.

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