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Ask a RAM: Shell vs. Tenant Improvements

Our Regional Account Managers (RAMs) frequently receive questions regarding the difference between Building Shell and Tenant Improvements (TIs).

Commercial real estate practice separates building shell and TIs.

Building Shell is the complete building envelope structure, the base building systems, and the finished common areas (building and floor common areas) of a building that adjoin the tenant areas.  

Examples of Shell items include:

  • Base structure and building enclosure (such as windows)
  • Base building electrical and mechanical systems
  • Finished common areas (including lobbies, elevators, restrooms, garages)
  • Wall board on exterior perimeter and interior core walls
  • Common corridor stud walls without wall board
  • Suspended acoustical tile ceiling with standard fluorescent lighting
  • Concrete floor
  • Tenant directory in the building lobby

Tenant Improvements (TIs) are the finishes and fixtures that typically take space from the shell condition to a finished, usable condition.  The resulting space is complete, meets applicable building codes, and meets the tenant agency’s functional needs.  In addition, TIs provide flexibility, choice, and savings incentives.

TI items include:

  • Electrical wiring, outlets, telephone jacks, data jacks, and horizontal conduit, including cable trays and hooks, within the tenant agency’s space and connecting to the building core. (Telephone and computer wiring and cabling may be funded within the TI allowance or provided by the tenant agency.)
  • Raised access flooring
  • Carpeting or other floor covering
  • Plumbing fixtures within the agency’s space and all lines connecting to the building core–except for common bathrooms.
  • Partitioning and wall finishes
  • Doors (including suite entry), sidelights, frames, and hardware
  • Millwork
  • Fire alarm wiring from building core to tenant agency space
  • Within tenant agency space: pull stations, strobes, annunciators, and exit signage,
  • Thermostats
  • Window treatments
  • Supplemental power, cooling or heating (above the open office plan layout capacities provided in the base building); higher rates of air exchanges (if it entails additional or upgraded air handling equipment); pathogen control systems; and all other special HVAC components required by specific tenant agency needs, and tenant agency program equipment (such as fume hoods and exhaust systems).
  • Adjustment or repositioning of sprinkler heads to avoid conflict with tenant agency’s particular office partition layout; additional sprinklers required by local code to meet tenant agency’s layout, or ceiling grid adjustments and consequent repositioning of sprinkler heads to the center of ceiling tiles.
  • Tenant agency signage in the common corridor and within the tenant agency’s leased area.
  • Changes (moves) or additions to the open-plan lighting pattern, or to the open-plan HVAC distribution network (such as additional ductwork, ceiling diffusers) to accommodate individual office layout.
  • Upgrades or changes to building standard items, such as plaster or vaulted ceilings, specialty lighting, and upgraded ceiling tile.
  • Structural enhancements to base building to support unconventional floor loads, such as a library.
  • Private bathrooms, private elevators, or staircases within tenant agency space specifically requested by the tenant agency for its use.

Building security requirements are separate capital investments in the property that are neither Shell nor TIs.

For more information on Shell and TI, please visit to view GSA’s Pricing Desk Guide, 4th Edition.  Chapter 2 references pricing in leased space, and chapter 3 references pricing in federally owned space.

If you have further questions about Shell and TIs, please contact your Regional Account Manager.

PBS Regional Account Managers
Pat Zucca (215) 446-2889
Dorothy Grosick (215) 446-4569
Kimberly Hart (215) 446-4588
Peggy Murr (215) 446-2888
Justin Owens (215) 446-5712
Pedro Viera (215) 446-4534
Jessica Giannone (215) 446-4599


This article is part of the Spring 2015 issue of the FOCUS newsletter. Please visit the Focus Newsletter page to read our newsletter. To subscribe to FOCUS, complete the online subscription form.


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