Landlord Work Letter Cost Calculator

Work letter items land before TI start. This calculator totals landlord spend.

HVAC drop cost

Sprinkler & life safety

Electric service

Restrooms & common

Demo & cleanup

Management markup

Total work letter

$744,800

Hard cost subtotal

$665,000

Markup amount

$79,800

How the math works

Total work letter = hard cost + management markup for landlord's base-building delivery.

Shell-to-second-generation deliveries land $25-35/sf; more finished spaces (demising, basic HVAC, rough plumbing) $15-25/sf. Work letter costs are frequently undersized in pro formas — a $665k work letter on a mid-size deal is a real number that shouldn't get buried inside a lumped 'soft cost' bucket.

How to Use

Enter HVAC drop cost.
Enter sprinkler and life safety cost.
Enter electric service cost.
Enter restroom and common area cost.
Enter demo and cleanup cost.
Enter management markup %.
Read total work letter cost.

Frequently Asked Questions

What is a work letter?

Schedule of items landlord delivers as part of base building prior to tenant TI work. HVAC rough, sprinkler, life safety, electric service, restrooms, fire-rated demising walls. Typical $25-45/sf depending on whether space is shell or second-generation.

Landlord vs TI split?

Landlord work = permanent building systems that benefit future tenants (HVAC, sprinkler, electric service). TI = tenant-specific finishes (flooring, lighting, partitions). Clear split prevents disputes at delivery and at end-of-term restoration.

Why markup?

Construction management, bonding, insurance, overhead. Typical 10-15% on landlord work. Built into base building, not chargeable to tenant separately — but drives whether landlord funds vs charges back.