The total monetary subsidy provided by the landlord for space customization.
By Angel Campa, Founder · Updated March 2026
The TI allowance is often the largest single concession in a commercial lease. A $50/RSF allowance on 10,000 RSF represents $500,000 in landlord-funded construction. Extracting this amount accurately is essential for calculating the landlord's effective rent, evaluating competing proposals, and determining the unamortized balance for termination penalty calculations. It also affects the security deposit and personal guarantee amounts that landlords require.
Found in the "Tenant Improvements" section, "Work Letter" exhibit, or "Construction" addendum. May be stated as a total dollar amount, a per-RSF rate, or both. Disbursement conditions are typically detailed in the same section.
Lextract uses a combination of AWS Textract OCR and Claude AI to identify and extract the ti allowance from your lease PDF. The AI searches for all pages of the document, then assigns a confidence score based on OCR quality and extraction certainty. Fields with lower confidence are flagged for human review.
TIA per RSF
The improvement allowance calculated on a per-square-foot basis.
Landlord's Work
The specific construction obligations the landlord must complete prior to possession.
Tenant's Work
The scope of construction the tenant is responsible for managing and funding.
Restoration Obligation
The duty of the tenant to remove improvements and restore the space upon exit.
HVAC Responsibility
Identifies whether the landlord or tenant is responsible for replacing HVAC units.
TI allowances vary widely by market and lease term. For new office leases, $40-$80/RSF is common in major markets for 5-10 year terms. Renewal TI allowances are typically 50-75% of new-lease amounts. Industrial leases may offer $5-$20/RSF, and retail varies based on the tenant's credit strength.
Only if the lease explicitly allows it. Some work letters include a conversion clause permitting the tenant to apply unused TI funds as a rent credit. Without this language, unused allowance reverts to the landlord, so tenants should negotiate conversion rights upfront.
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