Vanilla Box vs. White Box vs. Cold Dark Shell
Delivery condition is the state of the space when the landlord hands it over. It drives how much the tenant spends on build-out, so it matters as much as rent.
The labels below are not standard. They mean different things in different markets and to different landlords. Always list the actual work in the LOI.
Cold dark shell
Four walls, a roof, and a slab, often with no HVAC, no finished ceiling, and utilities only to the building. The tenant builds almost everything. Common in new construction. Expect a larger TI allowance.
Warm shell
A shell with basic utilities brought to the space and sometimes HVAC. The tenant still builds the interior.
Vanilla box
Usually a shell plus working HVAC, electrical service, a restroom, and walls ready for paint. The tenant adds finishes, lighting, and fixtures. Some markets call this a white box.
White box
Often a step above vanilla box: drop ceiling, lighting, finished and painted walls, a restroom, and basic flooring. Ready for the tenant's fixtures and decor.
Second-generation space
Space left by a prior tenant of the same type. A second-gen restaurant may come with a hood, grease trap, walk-in cooler, and gas. This can save a restaurant operator a lot of money. Get the condition of the equipment in writing.
What to put in the LOI
- HVAC tonnage and condition
- Electric service (amps, voltage, phase)
- Gas line size, for restaurants
- Water, sewer, and grease trap
- Restrooms and ADA compliance
- Ceiling, walls, floor, and storefront
- Delivery date and the penalty if the landlord is late
More in Real Estate
- NNN vs. Gross vs. Modified Gross Leases
- TI Allowance and Free Rent: How to Negotiate Them
- Co-Tenancy Clauses Explained
- Exclusive Use Clauses in Retail Leases
Other guides
This guide is general information, not legal advice. Deal terms vary by market and by deal.