The unit is 1,400 square feet on a secondary parade. Bare blockwork, a power-floated concrete floor, a capped water supply in one corner, a three-phase board with nothing connected to it, and a roller shutter. The agent called it a blank canvas. The lease starts on the first of the month and the rent starts three months after that.
Between now and the day you open there are perhaps sixty separate decisions and four organisations who can stop you, and the thing that decides whether this is a success is almost entirely the order you do them in.
Cat A is the landlord's, everything you can see is yours
Commercial landlords typically deliver a shell, or a Category A fit-out: floor, ceiling grid, basic lighting, a capped services supply, sometimes a small power distribution and air conditioning to a generic layout. That is the landlord's works, and the heads of terms should list them line by line rather than describing them in a phrase.
Category B is everything that makes it yours. Partitions, flooring, joinery, counters, kitchen, extraction, shopfront, signage, lighting design, tills, data cabling, furniture and the finishes. It is your cost and mostly your risk.
Two lease provisions govern what you are allowed to do. You will need a licence to alter, a separate document consented to by the landlord and often by the landlord's lender, which usually requires you to submit drawings and specifications and to pay the landlord's surveyor's and solicitor's fees for reviewing them. That takes weeks and is routinely left too late.
The other is reinstatement. Most leases require you to put the premises back to their original condition at the end of the term, which means the fit-out you are about to install is also a dilapidations liability you will pay to remove in ten years. Negotiate a schedule of condition attached to the lease, photographed and dated, and try to agree that the licence to alter records that your works need not be reinstated. That single paragraph can be worth more than anything else in the negotiation.
The rent-free period is the fit-out budget
A rent-free period at the start of a lease is not generosity. It is a capital contribution paid in a form that suits the landlord's valuation, and it is negotiable in the same breath as the rent itself.
Three months is common on a short lease, longer on a longer one, and the useful way to think about it is as a cash sum: three months at £24,000 a year is £6,000 of your fit-out funded. A landlord may alternatively offer a cash contribution towards works, which is better for you because you can spend it now, and worse for them on tax and valuation, so expect resistance.
Whatever the shape, understand that the clock is running. A three-month rent-free period assumes you open at the end of it. Every week of overrun is a week of paying rent on a closed shop, which is why programme discipline is worth more to you than saving £2,000 on a contractor.
Do not forget business rates. Empty property relief covers a limited initial period, and once you are in occupation the rates are payable whether you are trading or fitting out. The rateable value comes from the Valuation Office Agency and you can check it before you sign. Small business rate relief may take a modest unit out of rates altogether, which is worth knowing at the point you are choosing between two premises.
Planning and building control run on their own clock
Since 1 September 2020 the Use Classes Order in England has grouped shops, cafés, offices, gyms, clinics and similar into a single Class E, and moving between uses within that class does not need planning permission. That removed a great deal of friction. It did not remove everything.
A new or altered shopfront normally needs planning permission. Signage usually needs advertisement consent under the Town and Country Planning (Control of Advertisements) Regulations 2007, particularly if it is illuminated. A flue or extraction duct on an elevation needs permission and will attract objections. If the building is listed or in a conservation area, listed building consent is a separate application with its own timetable, and internal works can be caught. Hot food takeaways sit in a separate use class and a change to one is a full application.
Building regulations apply regardless of planning. Approved Document B for fire, Part M for access, Part L for energy, Part P for domestic electrical work and the parts covering ventilation, drainage and structure. You either use a local authority building control service or an approved inspector, and you need the completion certificate at the end because the next tenant's solicitor will ask for it.
Then the ones people forget. The Regulatory Reform (Fire Safety) Order 2005 requires a fire risk assessment and, for a business with five or more employees, a written one. The Control of Asbestos Regulations 2012 require a refurbishment and demolition survey before intrusive work in any building constructed before 2000, and a 1970s parade is exactly the sort of building that has asbestos in the ceiling voids. Construction work engages the Construction (Design and Management) Regulations 2015, under which you are the client and have duties of your own, whatever the builder tells you. Food premises need registration with the local authority environmental health team at least 28 days before opening, and premises licences for alcohol run on their own statutory timetable under the Licensing Act 2003.
Eight weeks becomes sixteen for reasons you can predict
The programme your contractor gives you is a construction programme. It usually assumes drawings are final, consents are in place, long-lead items were ordered on day one and nothing unexpected is behind the walls.
The delays are boringly consistent. The licence to alter sits with the landlord's solicitor for five weeks. The bespoke shopfront has a twelve-week lead time and was ordered in week six. The three-phase supply upgrade needs the distribution network operator, who quote in weeks and deliver in months. Building control ask for a change to the means of escape. The asbestos survey finds something. A variation you agreed verbally on site turns up as £4,800 on the final account.
Two things reduce it. Finish the design before you start on site, because the expensive changes are the ones made after the walls are up. And order the long-lead items, meaning the shopfront, the extraction, any bespoke joinery and anything needing a utility connection, before the contractor starts, even if that feels premature.
Budget a contingency of the order of 10% to 15% and treat it as spent. Add professional fees, VAT, the landlord's costs, the stock, and enough working capital to trade for the first quarter, because a beautifully fitted shop with no money behind it is a common and avoidable way to fail.
Where this shows up in the game
Business Baron makes premises a project rather than a purchase. Works take months you can see in the cash flow, consents come from bodies with their own timetables, and a fit-out that runs over means paying rent and rates on a unit that is not yet earning. The programme and the money interact exactly the way they do on a real parade, which is why the cheapest quote is frequently not the cheapest outcome.