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Running a CrossFit Facility Tips and guidance on how to open and operate a CrossFit gym.

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Old 03-25-2011, 06:02 AM   #1
Stuart Brauer
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Did you have to pay buildout cost upfront?

Question to all Affiliate Owners:

Did you have to pay for you build out costs upfront when opening your box?

More specifically, for a raw space, is it standard to have to pay upfront for the contractor/build out costs which are then reimbursed by the commercial real estate company?

Much Appreciated!
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Old 03-25-2011, 08:43 AM   #2
James lee
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Re: Did you have to pay buildout cost upfront?

everything is negotiable but usually u can ask for TI (tenant improvement) allowance as part of the lease. get a RE agent to negotiate for you.
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Old 03-25-2011, 09:05 AM   #3
Katherine Derbyshire
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Re: Did you have to pay buildout cost upfront?

The contractor certainly wants to get paid as promptly as possible, but doesn't much care who pays him. Negotiate with the landlord.

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Old 03-25-2011, 11:00 AM   #4
Stuart Brauer
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Re: Did you have to pay buildout cost upfront?

Our potential landlord is stating that we have to pay the TI cost upfront and then would be reimbursed in one lump-sum after our first months rent had been recieved.

This is raw space...a buildout, even for a simple CF box, is going to be damn expensive after the basics (HVAC, plumbing, electric).

I figure that this has got to be negotiable.

Has anyone else ran into this issue?
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Old 03-25-2011, 04:14 PM   #5
Brian Strump
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Re: Did you have to pay buildout cost upfront?

I would suggest finding another space. Have you ever built any office from scratch? If you have no time line for opening, go for it....but that is going to be a HUGE headache.

I see you're in Charlotte, where are you looking to open? Mecklenburg county has some of the strictest laws regarding building codes in the states. And the more new that you put in, the more that they can find wrong.
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Old 03-27-2011, 08:47 PM   #6
Joe Valenzuela
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Re: Did you have to pay buildout cost upfront?

We're currently going through a similar process, but we dealt directly with the landlord without a commercial realtor.

Negotiating the build-out allowance was just the start.

Before you even get to that point, you might need to hire an attorney to help you get all the proper approvals for a "change of use" of the space, because it's all a moot point if you can't get the permit.

Once you get past that hurdle (took us almost 3 months of heartache), you're going to need an architect to draw up the space and then an general contractor (or two) to give you a quote on the cost to build out. Be prepared to scrape your jaw off the ground. We've been flabbergasted at every step of the way with regard to commercial construction costs.

Then you have to hope that your landlord has a good relationship with the Building Inspector. If not, you'll need to comb through every step of the construction planning process with a fine toothed comb. And that costs more money if the architect need to do code reviews, sign affidavits, etc. We have to provide Material Data Safety Sheets for EVERYTHING that is going into the build-out--from the rubber flooring, paint, poly for the platforms, carpet padding, to you name it.

This whole process started in December for us. Let's just say that I'll be REALLY happy if we're able to pull the Building Permit by the end of this week for our above ground work. We're praying for a soft opening in May so we can sign up kids for off-season conditioning programs over the summer.

All I can say is GOOD LUCK!

Joe

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Old 03-28-2011, 04:18 AM   #7
Brian Strump
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Re: Did you have to pay buildout cost upfront?

Quote:
Originally Posted by Joe Valenzuela View Post
We're currently going through a similar process, but we dealt directly with the landlord without a commercial realtor.

Negotiating the build-out allowance was just the start.

Before you even get to that point, you might need to hire an attorney to help you get all the proper approvals for a "change of use" of the space, because it's all a moot point if you can't get the permit.

Once you get past that hurdle (took us almost 3 months of heartache), you're going to need an architect to draw up the space and then an general contractor (or two) to give you a quote on the cost to build out. Be prepared to scrape your jaw off the ground. We've been flabbergasted at every step of the way with regard to commercial construction costs.

Then you have to hope that your landlord has a good relationship with the Building Inspector. If not, you'll need to comb through every step of the construction planning process with a fine toothed comb. And that costs more money if the architect need to do code reviews, sign affidavits, etc. We have to provide Material Data Safety Sheets for EVERYTHING that is going into the build-out--from the rubber flooring, paint, poly for the platforms, carpet padding, to you name it.

This whole process started in December for us. Let's just say that I'll be REALLY happy if we're able to pull the Building Permit by the end of this week for our above ground work. We're praying for a soft opening in May so we can sign up kids for off-season conditioning programs over the summer.

All I can say is GOOD LUCK!

Joe

http://www.facebook.com/crossfitwicked (w/f/s)
Pretty much this. Especially if it's a buildout to include electrical and plumbing. Good luck!
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Old 04-04-2011, 08:39 PM   #8
John Seiler
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Re: Did you have to pay buildout cost upfront?

Our experience was a lot like Joe's; although we did have a broker. You MAY get lucky but whatever you think this trip will take (time, money, patience, etc.) multiply it by 3 to be safe. If it's less; great.

As far as regards your specific question, every landlord is different. Some will invest in the buildout up front, some won't. Expect them to be more reluctant with a start-up like yours. And at the end of the day, if don't have the dough for the buildout, you don't have it. Move on to the next property.

The one thing that did shock me was how unmotivated some of these guys were. I'd seen their units open in some cases for over a year. And yet they apparently think it's still 2007 and they can get whatever price they want. Nuts. But eventually you'll find a space. BTW, one nice thing about a broker: it eliminates the whole "he said, he said" thing. There is no confusion.
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