Business fit-out finance: turning an empty tenancy into a place that trades

The lease is signed, the keys are in your hand, and the space is a concrete box with a few exposed wires. Between now and opening day sits the fit-out: joinery, flooring, lighting, plumbing, air-conditioning, signage, furniture and equipment. It’s often the single biggest cheque a small business writes in its early years, and it’s one of the trickiest to fund — because most of what you’re paying for gets bolted to a building you don’t own.

What does a fit-out actually include?

Owners usually think of the builder’s quote. Lenders, and experienced operators, think in lines:

• Design and approvals: drawings, project management, council and building approvals, landlord sign-off
• Building works: partitions, ceilings, flooring, joinery, counters, finishes
• Services: electrical capacity, plumbing, gas, data, ventilation, air-conditioning
• Equipment and furniture: the items that could be removed and sold
• Signage and branding: street signage, window graphics, lighting
• Opening costs: first stock, launch marketing, staff training
• Downtime: rent and wages while the site is closed for works

Business.gov.au suggests checking with your council about zoning and any permits or approvals you need before you can fit out. Do that before you commit to a design — retrofitting approvals is expensive. Our free fit-out budget builder walks through each line and adds a contingency.

Why is a fit-out hard to finance on its own?

A lender’s comfort comes from knowing what it could recover if things went wrong. A coffee machine can be sold. A custom-built timber counter, fixed tiling and ducted air-conditioning mostly can’t — they belong to the building once installed, and much of their value disappears if they’re removed.

That’s why fit-outs are generally funded in pieces:

Part of the fit-out	Common way to fund it
Movable equipment and furniture	Equipment finance, secured by the items
Building works and finishes (trading business)	Unsecured business loan sized on turnover
Building works and finishes (property owner)	Property-secured loan, $20k to $5m
Deposits and early progress payments	Owner funds or a short-term facility
Opening stock and launch costs	Working capital or a line of credit

Fit-out finance for a trading business vs a new one

If you’re already trading — refitting your current site, or fitting out a second location — lenders can look at your bank statements and BAS to see whether the business can carry new repayments. That opens up unsecured options and makes the conversation much simpler.

If you’re opening for the first time, there’s no trading history to lean on. The realistic mix is usually owner funds, equipment finance for the movable items (often with a deposit), and a loan secured against property you or a director own. See opening a business for how those pieces fit together.

Not sure where you fall? Send us your fit-out outline — a specialist will tell you which mix suits, and enquiring doesn’t involve a credit check.

The lease changes the numbers

Before you sign a lease, read it as a funding document as well as a property one:

• Incentives. A landlord’s fit-out contribution or rent-free period reduces how much you need to borrow.
• Term and options. A short lease with no option to renew means you have limited time to earn back the fit-out cost.
• Make good. If you must return the premises to its original state at the end, that’s a future cost to plan for.
• Approvals. Many leases require landlord consent for works — build that time into your schedule.
• Security deposits and bank guarantees. These tie up cash at exactly the moment you need it for the build.

Retail lease rules vary from state to state, so check your state’s retail leasing legislation or small business commissioner for what applies to you, and have the lease reviewed before you sign.

Getting the timing right

Fit-outs run on progress payments. A shopfitter might want a deposit at contract, staged payments as work is completed, and the balance at handover. Finance, meanwhile, is usually drawn as a lump sum or against invoices. Map the two side by side:

1. Get the shopfitter’s payment schedule in writing.
2. Ask how and when each finance facility can be drawn.
3. Fund the gaps — often the early deposit — from owner funds or a short-term facility.
4. Keep a contingency untouched until handover.

Illustrative example: A physiotherapist moving from a shared room into her own tenancy budgets for partitions, flooring, a reception counter, two treatment rooms and a gym area. Treatment beds and gym equipment go on equipment finance. The building works, approvals and signage are funded with an unsecured loan based on two years of strong bank statements. Her own savings cover the shopfitter’s deposit and a contingency.

Mistakes we see most often

• Signing the shopfitter’s contract before confirming the finance
• Budgeting the builder’s quote and nothing else
• No contingency, then a surprise in the ceiling or under the floor
• A loan term that runs longer than the lease
• Forgetting the weeks of rent and wages before the first customer walks in

Our guide to budgeting a fit-out before you sign goes deeper on each of these.

Ready to fund your fit-out?

Bring your budget — even a rough one — and tell us about the premises, the lease and how long you’ve been trading. A real person will work out which parts suit equipment finance, which suit a business loan, and how to time it all. Asking costs nothing and leaves your credit file untouched, your details aren’t passed around a crowd of lenders, and careful answers on the form help us get you to the right option first go. See if your fit-out qualifies.