Fit Out Finance

What is fit out finance and how does it work? Explore and compare your options for refitting a work space with Savvy.

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, updated on July 26th, 2023       

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What is fit out finance and how does it work?

Fit out finance is a specialised loan designed to cater to the refitting of a business premises. It’s intended to provide the finances to fit out or refit a shopfront, workshop, office or other work space.

Fit out finance is available both as secured and unsecured loans, depending on what collateral you have to offer as security. If you go for an unsecured loan, you can generally borrow up to half the cost of the fit out – although, of course, the maximum amount offered depends on both the lender and where your business is at financially. If you have an asset to use for a secured loan, you can often borrow up to the full fit out cost – and a significant asset can give you a lot of extra lending power.

It’s up to you how the work is done, meaning you have the choice of using individual contractors to do the work, going all out to hire a professional all-in-one fit out company or saving money by doing some of the work yourself (if you have the skills. It’s always worth comparing your options and seeing which one works best for your budget.

What can I use fit out finance for?

Specialised fit out finance covers a lot of things in a business refit, but it doesn’t cover everything – it's intended to cover the building interior and fixtures, not the appliances and tools you put in there.

Most building internals are covered, so fit out finance will apply to:

  • Electricals, including lighting, air conditioning, and electrical sockets
  • Cabinets and shelving
  • Flooring
  • Signage
  • Workbenches and counters
  • Security systems and fittings
  • IT infrastructure and phone hardware
  • Minor modifications to the walls and internal structure

The things it doesn’t cover are what you then put inside the building, and potentially take with you if you move premises, such as:

  • cash registers
  • coffee machines
  • industrial fridges and freezers
  • other appliances

Sometimes, there’s a fine line between the things that are included in fit out finance and those that aren’t. It’s your choice whether you want to save costs by doing a budget upgrade or go all out for high-end fittings. Costs obviously vary massively depending on materials and the kind of space you’re fitting out but, as a ball-park figure, you should budget for low end fittings costing a few hundred dollars per square metre and high-end fittings and flooring ranging up to several thousand dollars per square metre.

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Top tips for keeping costs down for a fit out

Get several quotes

A simple truth of renovations is that different companies and contractors charge different amounts. Get a few different quotes to compare for the work, and go with the one you’re happiest with.

Get your hands dirty

If you have the skills to do it, you can save a lot by doing some of the work yourself. Even if parts of the project require a trained and certified professional, there might be other parts that don’t. Building a custom cabinet for an unusual space will probably require the skills of a carpenter, but breaking the old one apart probably doesn’t.

Don't overspend

It’s easy to get carried away when renovating and blow money on making your space just that tiny bit nicer. Work to an airtight budget and make choices about what you’re going to spend extra on and what not to.

Work with the existing framework

While a fit-out loan does allow you to make some basic modifications to the space, knocking out walls and putting in windows doesn’t come cheap. If you can work with the existing building structure rather than needing to modify the building, it’ll normally work out to be much cheaper.

Sell old fittings

You’d be surprised at what your old fixtures might be worth. It’s worth saving anything you can (such as shelving that could still be re-attached to a wall), and seeing what things can sell for online.

Compare finance options with Savvy

Don’t just settle for the first finance option you come across on the net. Finding good terms on your fit out finance can save your thousands over the life of your loan. Using our comparison service to compare your options can help you find the best one available for your business and save.

Frequently asked questions about fit out finance

Can I get finance to fit out a new business?

Yes – many lenders have requirements regarding the minimum length of time trading, such as nine to 12 months, which might rule out your business. However, there are some lenders who will offer fit out finance to a business that’s just setting up their office or work space. You’ll need to provide a detailed business plan and cashflow forecasts that you’ve discussed with a qualified accountant in these instances.

Should I be getting finance for equipment and a shop fit-out at the same time?

You should always be wary of getting multiple loans at the same time, as it’s not good for your business’ credit rating. If you’re needing finance for a complete and total business refit, you might be better off with a less specialised loan like a standard unsecured business loan. Savvy can help you with finding the best business loan for your situation, allowing you to easily compare commercial loans from some of Australia’s top lenders and find the one that’s right for you.

Can I get fit-out finance for a franchise business?

Yes – fit out finance is available for franchises. Many franchises make regular use of them with store fit outs every time the lease is renewed on the franchise.

What kind of premises can fit out finance be used for?

Almost any kind of office or business workplace is eligible for fit out finance. Shop fronts, offices, workshops, warehouses, industrial kitchens – you name it. It can even be used for highly specialised workplaces, such as medical facilities.

What kind of documents will I need to provide to a lender for fit out finance?

You’ll need proof of identity, planed details of your fit out, and generally 2-3 years' worth of financial records for your business. You may also need bank statements (for you and your business).

How long do I have to repay a fit-out loan?

Loan terms will vary from lender to lender, but as a rule, unsecured loans will need to be paid off within a few years – terms of up to five years are common. If you’ve gone for a secured loan, you’ll generally have considerably longer – often a decade or even longer.

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