Tenant Improvement Reimbursement Lag Calculator

Reimbursement lag increases tenant effective cost of build-out.

Submission to approval

Approval to payment

Documentation delay

Invoice amount

Cost of capital %

Effective carry cost

$2,712

Total lag days

Daily carry cost

$49

How the math works

Total lag = sum of stages. Daily carry = invoice × COC / 365. Cost = daily × lag.

55 days lag × ($200k × 9% / 365) = 55 × $49.32 = $2,713 effective carry cost on a single invoice.

How to Use

Enter submission-to-approval days.
Enter approval-to-payment days.
Enter documentation delay days.
Enter invoice amount.
Enter cost of capital %.
Read effective cost of lag.

Frequently Asked Questions

What's a typical TI lag?

Small landlords: 45-90 days. Institutional landlords: 30-60 days. REIT-managed: 21-45 days. Lender-approved proceeds (landlord financing tenant improvements via loan): 30-60 days including lender administrative steps. Luxury office (Hines, Tishman Speyer): often <21 days with white-glove process. The variance is largely operational: good landlords have standardized TI processes; bad ones invent the process each time.

What slows down reimbursement?

Missing lien waivers from subs (biggest single cause — tenant GC tardy), change-order documentation disputes, lack of final inspection, owner's rep review delays, lender construction draw coordination (if landlord-financed), split-payee issues between tenant and vendor. Each issue adds 7-30 days. Institutional tenants assign a construction coordinator purely for TI paperwork management.

Can lag be negotiated?

Yes. Ask for (1) fixed timeline in lease (e.g., '30 days from complete submission'), (2) late-payment interest at prime + 2%, (3) tenant remedy if landlord misses timeline (offset against rent after 45 days), (4) escalation to senior landlord exec if dispute. Include TI process document as lease exhibit. These are common in institutional tenant leases and rare in small-business leases.

How do you minimize lag as tenant?

(1) Submit packages complete first time (missing docs restart the clock), (2) use a dedicated construction coordinator for TI paperwork, (3) collect lien waivers before GC pays subs not after, (4) schedule inspection at milestone not just at end, (5) keep copies of everything for rebuttal. Institutional tenants reduce lag 50%+ with these practices. Small tenants often take 2x the time on same-size build-out due to amateur paperwork.