Permits, inspections and getting to occupancy

Most disputes about a bay fit-out are really disputes about time. The work is understood; the permits and inspections that sit around it are not, and they are what decides when you can open.

Who applies for what

As a general pattern, the landlord's work is permitted by the landlord and the tenant's work by the tenant — but the split is defined in the lease, not by convention. Read the work schedule carefully. The two failure modes are a gap, where each side assumed the other was doing something, and an overlap, where both permit the same work and the inspections conflict.

The sequence

1. Development permit where the use or the site is changing. This approves the use. It can carry conditions and, for a discretionary use, an appeal period.
2. Building permit for the physical work — partitions, mezzanines, washrooms, structural changes, changes to exiting.
3. Trade permits — electrical, plumbing, gas and fire protection are separately permitted and separately inspected.
4. Inspections during construction — some elements must be inspected before they are covered, so sequencing matters.
5. Final inspections for each trade.
6. Occupancy — the municipality's confirmation that the space may be occupied for its approved use.
7. Business licence — the permission to operate the business at that address.

Occupancy is the date that matters

A lease that lets you take possession on a date says nothing about whether you may lawfully occupy on that date. Occupying without the required occupancy approval exposes you to enforcement, and it can affect your insurance. If your lease has a fixturing period and a rent commencement date, make sure the rent commencement is tied to something you control or to occupancy being achievable — not to a calendar date that assumes a permit timeline nobody has verified.

Where fit-outs actually get delayed

• Discovering late that the use is discretionary, and losing weeks to the approval process.
• Mechanical design for exhaust and make-up air, which is often the long pole.
• Electrical service upgrades requiring utility coordination.
• Fire protection changes triggered by racking or by a change in stored commodity.
• Barrier-free requirements in the office and washrooms, which are frequently underestimated.
• Deficiencies at final inspection where earlier work was covered before it was inspected.

Practical advice

• Get the municipality's own confirmation of the use in writing before firm-up.
• Have a designer look at the space before you sign if your fit-out is anything more than paint and partitions.
• Budget time, not just money. A permit queue is not something a contractor can compress.
• Keep every permit, inspection report and certificate. You will need them at the end of the term, and a buyer or a future landlord will ask.
• Do not start work early to save time. Work done without a permit usually has to be opened up and inspected, which costs more time than it saved.