Commercial Space Delivery Conditions, Explained
A cold shell is an empty building with no heating, cooling, or finished interior. A warm shell adds basic heating and cooling, power and restrooms. A white box, also called a vanilla shell, adds finished walls, ceilings, lights and floors. The more finished the space is, the less a tenant spends to move in.
When you lease commercial space, the landlord hands it over in a certain condition. Landlords and brokers use terms like “cold shell,” “warm shell,” and “white box” to describe it. These terms decide how much construction you’ll need, and how much you’ll pay, before you can open.
In this guide, Built Better Construction explains each term in plain English, compares them side by side, and shows what each one typically costs to finish.
What Is a Cold Shell?
A cold shell, sometimes called a cold dark shell, is the most basic condition. You get the building’s structure, outside walls and roof, but no heating or cooling, no finished interior, and often only basic utility connections at the edge of the space. The tenant pays to build almost everything inside.
What Is a Gray Shell?
A gray shell sits between a cold shell and a warm shell. Utilities like water, sewer, and power are brought to the space, but the inside is still unfinished. There are usually no interior walls, ceilings, or finished restrooms. The tenant still pays for most of the build-out.
What Is a Warm Shell?
A warm shell is a building with basic systems in place. It usually includes heating and cooling, electrical service, fire sprinklers, and restrooms, often in the core of the building. The inside is still open, so the tenant pays for walls, ceilings, lighting and finishes.
What Is a White Box or Vanilla Shell?
A white box, also called a vanilla shell, is a space that’s mostly finished but blank. It usually has finished walls, a ceiling grid, basic lighting, flooring, working heating and cooling, and code-compliant restrooms. The tenant adds the layout, fixtures, and finishes that fit their business.
What Is a Second-Generation Space?
A second-generation space was built out for a past tenant. It may already have walls, offices, restrooms, and systems you can reuse. That can save a lot of money, but only if the old layout fits your business.
Cold Shell vs. Gray Shell vs. Warm Shell vs. White Box: Side by Side
| What's Included | Cold Shell | Gray Shell | Warm Shell | White Box |
|---|---|---|---|---|
| Structure, Outside Walls and Roof | Yes | Yes | Yes | Yes |
| Utilities Brought to the Space | Basic, at the edge | Yes | Yes | Yes |
| Heating and Cooling | No | No | Yes | Yes |
| Restrooms | No | No | Yes, often in the core | Yes |
| Fire Sprinklers | Varies | Varies | Usually | Yes |
| Finished Walls and Ceiling | No | No | No | Yes |
| Lighting and Flooring | No | No | No | Basic |
| Fixtures, Millwork and Equipment | No | No | No | No |
These terms are not legal standards. They mean different things to different landlords. Always ask for a written list of exactly what’s included, often called a work letter or delivery specification.
[Owner insight]: One or two sentences from the owners on what Tampa landlords commonly call a “warm shell” and what tenants should double-check.
How Much More Does It Cost to Finish Each Type of Space?
The less finished the space, the more the tenant pays. This table shows roughly how much extra each condition can add, compared with a second-generation space you can reuse.
| Delivery Condition | Typical Added Cost to the Tenant (Per Sq. Ft.) |
|---|---|
| Second-Generation Space | Starting point (lowest) |
| White Box / Vanilla Shell | $20 to $60 more |
| Gray Shell | $45 to $100 more |
| Cold Shell | $60 to $130 more |
National figures from Richardson Construction. These are added on top of your own layout and finishes. Your real cost depends on the space and your business.
For a 3,000 square foot space, the difference between a white box and a cold shell can be well over $100,000. That’s why the delivery condition matters as much as the rent.
Which Type of Space Is Right for Your Business?
It depends on how custom your space needs to be.
- Offices and many retail stores often do well with a white box or warm shell. They mostly need walls, lighting, and finishes.
- Restaurants often lease a gray or warm shell. Kitchens need custom plumbing, grease systems, and exhaust hoods, so a finished white box may need to be torn out anyway.
- Medical and dental offices need plumbing in many rooms and special electrical and air handling. A warm shell or gray shell lets the build-out be designed around those needs.
- Any tenant on a tight timeline should look for a white box or a second-generation space that fits, since less construction means opening sooner.
What Should Tampa Tenants Check Before Leasing?
- Get the delivery condition in writing. Ask for a work letter that lists exactly what the landlord provides.
- Check the heating and cooling. Florida heat is hard on equipment. Ask about the age and size of the system, and whether it's big enough for your use.
- Check the electrical service. Restaurants and medical offices often need more power than a standard space has.
- Check flood and storm protection. In coastal areas, ask whether the space is in a flood zone and whether the storefront and windows are impact-rated.
- Match the allowance to the condition. A cold shell should usually come with a bigger tenant improvement allowance.
- Walk the space with a contractor before you sign. They can spot costly gaps while you can still negotiate.
Cold Shell, Warm Shell and White Box FAQs
Is a warm shell the same as a white box?
No. A warm shell has basic systems like heating, cooling, power and restrooms, but the inside is still open. A white box goes further, with finished walls, ceilings, lighting and flooring. A white box usually costs a tenant less to finish than a warm shell.
Is a vanilla shell the same as a white box?
Yes. “Vanilla shell” and “white box” usually mean the same thing: a clean, mostly finished space with walls, ceilings, basic lighting and flooring, but no fixtures or custom finishes. The exact meaning can vary by landlord, so always check the written list of what’s included.
What is a work letter in a commercial lease?
A work letter is the part of a commercial lease that spells out the construction for the space. It lists what the landlord will build, what the tenant will build, the tenant improvement allowance, and who manages the work. It’s the best protection against confusion over shell terms.
Which shell condition is cheapest for a tenant?
A second-generation space or a white box is usually cheapest for a tenant to finish, because much of the work is already done. A cold shell costs the most to finish. The best value depends on the rent, the allowance, and how well the space fits your business.
