When you look at premises, one of the first questions you should ask is where on the scale between a bare shell and turnkey they sit. The answer determines not only what you pay in rent, but also how much responsibility, risk and work you take on, both when you move in and on the day you eventually move out. In our main guide to commercial leases we touched on this briefly. Here we go into more depth, because the terms barehouse, "as is" and move-in ready are used interchangeably in the market, and because the difference between them can quickly become expensive if you do not know what you are signing.
A scale, not three boxes
The simplest way to think about the delivery standard is as an axis. At one end sits the raw, unfinished space where you handle everything yourself. At the other end sits the fully furnished space you can move into with your laptop under your arm. Most ordinary leases fall somewhere between these extremes. The further left on the axis you sit, the more control you get over the space, but also the more capital, responsibility and risk. The further right, the more predictable and flexible, but at a higher price per square metre.
The point is that no position is the "correct" one. An established business with specific requirements will often prefer to fit out a rawer space from scratch, while a company of five people that is growing fast rarely has either the capital or the appetite for that. The trade-off between control and low cost on one side, and flexibility and predictability on the other, is often the most important decision in the entire leasing process. Let us work through the axis from left to right.
Barehouse: when you take on almost everything
A barehouse lease is the standard that places the most responsibility on the tenant. In short, you start from an ordinary lease and shift a large share of the landlord's normal obligations onto the tenant. This typically covers both internal and external maintenance, replacement of technical installations, property tax and insurance. In the most far-reaching cases, the landlord is left with little more than responsibility for their own financing. Internationally, the same arrangement is known as a "triple net" lease.
One thing is worth noting for most tenants: barehouse standards exist only for entire buildings, not for individual premises. It is a model suited to large players who lease a whole single-tenant building and have the competence to operate it themselves, or to situations where a seller becomes the tenant of their own building through a sale-and-leaseback. If you are leasing a floor or a couple of hundred square metres of office space, barehouse is not realistically on the table. Should a landlord nonetheless present something "barehouse-like" for ordinary premises, that is a reason to pause and read carefully.
"As is": the most common standard, and the most misunderstood
For existing premises, "as is" is the norm. It is most likely the standard you will encounter if you lease ordinary, second-hand office space. The premises are taken over in the condition they were in when you inspected them, cleared and cleaned, and with any works described in the schedules to the contract. "As is" therefore does not mean the space is poor, only that you take it over as it stands, and that you carry the responsibility for having assessed whether it suits your needs.
This is where a common misunderstanding lies. "As is" is not in itself a high-risk solution reserved for large players. What determines the risk is how the condition is regulated in the contract, not the label. Legally, an "as is" clause means the threshold for succeeding with a defect claim against the landlord is higher than it would otherwise be. A deviation must normally be substantial before you have a claim. At the same time, the landlord can never contract out of responsibility for having given you incorrect or incomplete information. If the landlord withheld something they ought to have disclosed, pointing to "as is" will not help them. What you knew about, or ought to have discovered during the inspection, you cannot complain about afterwards. This is precisely why a thorough inspection, with photographs, is cheap insurance.
One point deserves extra attention. The most widely used standard lease offers a choice between two alternatives for who is responsible for ensuring the premises meet public-law building requirements. One places that responsibility on the landlord. The other places it on you as the tenant, and is known half-jokingly in the industry as the "slum clause", because it was originally intended for lower-standard property. If you end up on the wrong side of this choice, you could in the worst case be left with the bill for bringing the premises up to code. Check which alternative your contract uses, and ask to move the responsibility to the landlord where possible. How these standard leases are structured is something we look at more closely in our article on the standard commercial lease.
Move-in ready: from specification to turnkey
Moving right along the axis, we reach the move-in ready space. Here it is important to distinguish between two quite different variants.
The first is a space the landlord completes for you according to a specification before you move in, either new or refurbished premises, or existing premises where the landlord carries out agreed adaptations. The advantage for you is that the protection against defects is stronger than under "as is". When the premises are to be delivered in line with laws, regulations and an agreed specification, the starting point is that any deviation from what was agreed is a defect, without it needing to be substantial. In return, you usually pay for the security. The adaptations the landlord carries out are generally recovered through a higher rent and often a longer lease term, because the landlord wants the investment back.
In its purest form this is often called an "all inclusive" solution, where the rent covers both service charges and property tax, and the landlord retains the maintenance responsibility. It is effectively the opposite of a barehouse. You get maximum predictability in your costs, in exchange for paying a higher but more stable rent.
Furnished and "plug and play": the other extreme
At the very right of the axis you find the fully fitted, furnished spaces, often marketed as "plug and play", along with flexible coworking arrangements. Here you move in without investing in fit-out, the rent usually includes furniture and operating costs, and the notice period is short. For a small or newly established business that has neither the capital to invest in its own interior nor the desire to commit for ten years, this is often the most sensible entry point to the market. You trade away a little control and a slightly higher price per square metre in exchange for flexibility and predictability.
We also see a related variant emerging through subletting, where a company leases out surplus space furnished and "as is" on a shorter commitment. For many tenants that matches the need of the moment well, something we have written about in our article on hidden vacancy.
What decides the bill: handover, maintenance and reinstatement
Wherever you land on the axis, three contract points determine what the delivery standard actually costs you over time.
The first is the handover. The condition of the premises on the day you take them over is the reference point for everything that follows, right up until you move out. It is therefore essential that a handover inspection is carried out with a written record, and that you document the condition thoroughly with text and photographs. In a lease that may run for ten or fifteen years, this is the simplest and most important evidence you secure.
The second is maintenance. Under the most common standard for existing premises, you as the tenant are responsible for the internal maintenance of the area you occupy, while the landlord is responsible for the external fabric and for replacing technical installations when they are worn out. This places more responsibility on the tenant than the default position under Norwegian tenancy law, and in a barehouse lease it is taken further still. Always ask for a clear demarcation of who does and pays for what.
The third, and the one that most often takes tenants by surprise, is reinstatement. Under the current standard lease for existing premises, the main rule is that all the changes you have made to the space must be reinstated when you move out, unless something else is agreed in writing. This is a reversal of the rule in older leases, and it can produce a significant and unexpected final bill. The sound advice is simple: settle the reinstatement question when you obtain consent to make changes, not on the day you move out. It is often both cheaper and more practical to agree that the adaptations may stay than to have to remove them. The mechanics of alterations and reinstatement are something we have covered in more detail in a separate article.
What to look for
The common thread through all of this is that the headline price per square metre tells you little on its own. A space with a low rent can turn out to be the most expensive choice once maintenance, replacements and a possible reinstatement bill are added on top. Before you sign, you should therefore do three things. Establish which standard actually applies, and ask for it in writing. Read the clause on the condition of the premises at handover carefully, and make sure responsibility for public-law requirements does not land with you by oversight. And negotiate reinstatement at signing, while you still have bargaining power.
For a business of between two and fifty people, the point is rarely to push the rent as low as possible. It is to understand what the price includes, and where the responsibility sits, so that the total cost is predictable. If you are unsure where a particular space sits on the axis, or what a contract actually commits you to, that is exactly the kind of assessment we help tenants with every week. You are welcome to get in touch, at no cost to you.
Sources: Norsk Eiendom and Forum for Næringsmeglere (standard leases for commercial premises and commercial buildings), the Norwegian Tenancy Act (Lovdata), DLA Piper (Landlord's ABC), Advokatfirmaet Berngaard, Estate Nyheter, and Spacefinder's own experience from the market.
