What a Commercial
Tenant Improvement
Costs in Calgary

The allowance in the lease and the cost of the space you actually need can be two very different numbers. Understanding the gap before you sign is one of the most important parts of planning a commercial space.

A tenant improvement, or TI, is the work that turns a leased shell or a previous tenant’s space into one that works for your business: walls, ceilings, lighting, mechanical, electrical, plumbing, finishes, millwork and other interior improvements.

In Calgary, tenant improvements are often discussed as a cost per square foot, but the number can vary considerably. What is already in the space matters almost as much as what you want to add.

Before committing financially to a commercial location, understand what the space is approved for, what the base building provides and what upgrades your business will require.

The City of Calgary specifically recommends confirming the existing approved use and determining whether development, building or trade permits will be required before moving forward.

How much does a tenant improvement cost in Calgary?

These are the planning ranges we currently use to start a commercial fit-out conversation:

Commercial project type	2026 planning range
Office renovations and tenant improvements	$125–$250+ per sq. ft.
Retail fit-outs	$150–$300+ per sq. ft.
Medical, dental and clinic spaces	$200–$400+ per sq. ft.
Highly customized or specialty commercial spaces	$300–$500+ per sq. ft.

These are planning ranges rather than quotes.

Mechanical and electrical requirements, plumbing, accessibility upgrades, fire and life-safety systems, existing building conditions and custom millwork can all have a significant effect on the final investment.

The tenant-improvement allowance gap

Many commercial leases include a tenant-improvement allowance: a contribution from the landlord toward the cost of preparing the space.

It is valuable, but the allowance and the actual cost of your fit-out are two separate numbers.

The allowance is negotiated as part of the lease. Your construction budget is determined by the condition of the unit and what your business actually needs.

An illustration:

Example	Amount
3,000 sq. ft. office at $125–$250 per sq. ft.	$375,000–$750,000
Illustrative landlord allowance at $25 per sq. ft.	$75,000
Illustrative tenant share	$300,000–$675,000

Illustrative arithmetic only. The $25-per-square-foot allowance is an example, not a statement of current Calgary market terms.

The important number is the gap.

If you understand it before the lease is finalized, you may still have an opportunity to negotiate items such as the allowance, fixturing period, landlord work or other lease terms.

Once the lease is signed, those options may be much more limited.

What affects the cost of a commercial fit-out?

What is already there.
A second-generation office with usable ceilings, lighting, washrooms and HVAC distribution can require far less work than a raw shell.

A space previously occupied by another type of business may contain infrastructure you can reuse, or work that has to be removed or altered.

The approved use and any change of use.
The type of business you are putting into the space matters.

Changing from one use to another can introduce additional land-use, building-code, mechanical, plumbing, accessibility or life-safety requirements.

Calgary advises businesses to confirm the current approved use of a unit because a change in business activity may require a tenancy change, development permit, building permit or combination of approvals.

Mechanical and electrical.
Heating, cooling and ventilation need to suit the occupancy and use of the space. Electrical service needs to support equipment, lighting, technology and any specialized systems.

These requirements can be particularly significant in medical, dental, food-service and other specialty environments.

Plumbing.
Additional washrooms, sinks, treatment rooms, kitchen equipment and specialty fixtures can materially affect the cost, especially when plumbing has to travel significant distances through an existing building.

Accessibility and life safety.
Barrier-free access, washrooms, exits, fire alarms and sprinkler modifications may all form part of the project depending on the existing building and proposed use.

Millwork.
Reception desks, retail casework, exam-room cabinetry, staff kitchens and built-in storage are often some of the most visible and heavily used elements of a commercial interior.

LD&A’s millwork is designed, built and finished in our own Calgary shop, allowing it to develop alongside the rest of the space rather than being treated as a separate package at the end.

The building itself.
Landlord approvals, property-management requirements, construction hours, elevator bookings, access, insurance and safety documentation all affect how a project is delivered.

None is unusual. But all of them should be understood before the schedule is set.

Schedule is money

Commercial projects usually have dates attached to them: lease commencement, fixturing periods, staff moves, inventory deliveries and opening dates.

That makes schedule part of the financial plan.

Permits are one piece of that schedule.

Calgary requires a building permit for many commercial alterations, including work to structural or non-structural walls, certain mechanical, plumbing, gas or electrical changes, and some changes in occupancy or business activity. Trade permits may also be required. Purely cosmetic work such as painting and furniture may not require a building permit.

Most tenant-improvement projects do not require a separate development permit unless the work changes the approved use or otherwise alters the approved development.

A complete, coordinated application helps reduce avoidable delays.

Before you sign a commercial lease

Get a realistic fit-out budget for the actual space.
A 3,000-square-foot unit that looks inexpensive on paper may be a very different project once its existing mechanical, electrical, plumbing and code requirements are understood.

Understand what the landlord is delivering.
Know what is included in the base building, what is already installed and what becomes the tenant’s responsibility under the lease.

Confirm the approved use.
Make sure the business you intend to operate matches what the unit is currently approved for, or understand what approvals will be required to change it.

Understand the allowance gap.
Compare the landlord contribution with a realistic project budget before you rely on the allowance as the cost of the fit-out.

Build permits into the schedule.
Approvals should be part of the project timeline from the beginning, not something added after the lease is signed.

How we work on commercial projects

One team carries the project from early planning and drawings through permitting, construction, custom millwork and handover.

That means fewer handoffs and more decisions resolved before they reach the site.

We are accustomed to working with landlords, property managers, consultants and tenant representatives, and to building within occupied commercial properties.

Explore commercial renovations and tenant improvements by LD&A →

Common questions

How much does a tenant improvement cost in Calgary?
Our current 2026 planning ranges are approximately $125–$250+ per square foot for office, $150–$300+ for retail, $200–$400+ for medical, dental and clinic spaces, and $300–$500+ for highly customized or specialty commercial projects.

Existing building conditions, mechanical and electrical requirements, plumbing, change of use, accessibility and millwork can all move the final cost.

Does the landlord’s tenant-improvement allowance cover the whole fit-out?
Sometimes, but it should not be assumed.

The landlord allowance is a negotiated lease term. The cost of the fit-out is determined by the actual space and what your business needs.

The important step is to understand the difference before signing the lease.

Why do medical and dental spaces usually cost more?
They often require more plumbing, mechanical and electrical work, specialized equipment coordination, accessibility considerations and extensive cabinetry.

The exact cost depends heavily on what already exists in the unit.

Do I need a building permit for a tenant improvement in Calgary?
Often, yes.

Calgary requires a building permit for many commercial alterations, including construction involving walls and certain mechanical, electrical and plumbing work. A permit may also be required when a change in business activity affects the building-code classification or occupant load.

Work that is entirely cosmetic, such as painting or furniture, may not require one.

Do I need a development permit?
Not necessarily.

Most tenant improvements and commercial repair projects generally do not require a separate development permit unless the work changes the approved development or the new business use requires one.

What should I do before signing a commercial lease?
Confirm the approved use, understand what the landlord is delivering, establish a realistic fit-out budget and compare that budget with the tenant-improvement allowance.

That gives you a much clearer picture of the real investment before you commit to the space.

What a Commercial Tenant Improvement Costs in Calgary