Encyclopedia
Work letter
A schedule to a lease that sets out who designs, builds, pays for and approves the tenant improvements, and by when.
For example: Hypothetical: a work letter says the landlord delivers a demised space with base-building washrooms and heating, ventilation and air conditioning (HVAC), and the tenant builds everything else using an allowance paid on proof of completion. (Illustration only, not a real deal.)
This is a general industry term with no single official definition. Your lease or contract wording controls.
Example only, not a real client. Say you sign a lease for an office and the landlord agrees to build new meeting rooms. The work letter sets out the plans, the allowance, who pays for extras and the timeline. When costs rise, the letter shows who pays.
What I’d tell a friend
Treat the work letter as seriously as the lease. Most fit-out disputes come back to its wording.
Why it matters to you
It spells out who builds what, to what standard and by when. Clear details prevent disputes, delays and surprise costs before you move in.
How to use it in your deal
Tenants should read the work letter as carefully as the lease, since disputes often come from unclear descriptions. Check what's included in the landlord's work, specifications, delivery date, consequences of late delivery, approval process for tenant plans, how and when the allowance is paid, and who manages construction. Attach plans or specifications if possible.
Make sure the fixturing period starts only when the landlord's work is done. Landlords should be clear about base building standards and limits. Buyers should check outstanding work letter obligations. Ask your contractor to read the work letter before you sign, since they'll spot gaps like missing electrical capacity, plumbing stubs or HVAC sizing.
Walk the space with the landlord at delivery and write down any deficiencies, with a deadline to fix them. Check whether the allowance is paid on progress draws or only at the end, which affects your cash flow. Keep all approvals in writing.
Mistakes I see
Vague descriptions. No late delivery remedy. Unclear allowance payment.
In BC and Vancouver
Lease terms govern; building permits are municipal.
Official sources: Commercial Tenancy Act (BC Laws) · Builders Lien Act (BC Laws)
What it is
A work letter is a schedule to a lease that sets out the construction work for the space: who does it, the plans, the budget, the allowance and the timing.
It can cover landlord work, tenant work or both.
Key terms
Look at the allowance, how overruns are paid, who approves plans and changes, delays and what happens if the space is not ready on time, including whether rent start dates move.
Ask a BC lawyer to review it alongside the lease, and keep a copy of the approved plans with it.
Questions to ask before you sign
- What does the landlord deliver?
- When?
- How is the allowance paid?
- Who approves plans?
Keep reading
Related terms: Tenant improvements (TI), Tenant inducement, Fixturing period, Restoration clause
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General information for British Columbia only. It isn’t legal, tax, accounting or financial advice, laws and rates change, and reading it doesn’t make you my client. Any numbers or scenarios are hypothetical. Check the linked official source and talk to a lawyer, accountant or other qualified professional before you act or sign anything. See the terms and disclaimer.