Bare Shell Offices vs. Fully Fitted Offices: What’s the Real Cost of Getting Your Space Ready?

You’re growing your business, expanding into new markets, or setting up your next HQ in the Philippines. And now, you’re faced with a crucial decision: bare shell or fully fitted office?

At first glance, both seem like viable options. Bare shell offers freedom. Fully fitted offers convenience. But the differences run deeper and so do the consequences.

A bare shell office is essentially a blank canvas. It includes the building’s structural core: concrete floors, exposed ceilings, unfinished walls, and the most basic MEP (Mechanical, Electrical, and Plumbing) provisions. There are no internal finishes, lighting, or furnishings, everything must be built out from scratch.

In contrast, a fully fitted office is a move-in-ready workspace. It comes complete with flooring, ceiling finishes, partitions, lighting, air-conditioning, power outlets, desks, meeting rooms, and even internet connectivity. Think plug-and-play, ready for your team on day one.

What looks like a cost-saving move today can become a time-draining, budget-busting hurdle tomorrow. From delayed openings to hidden fit-out expenses, the wrong choice can slow down your team before they even log in.

This blog will walk you through the real costs, timelines, and long-term considerations of each option so you can confidently choose the setup that aligns with your business goals and growth plans.

Because in today’s fast-moving market, your office isn’t just where your team shows up, it’s how your business shows up stronger.

Are Bare Shell Offices Actually Cheaper?

At first glance, bare shell offices may seem like the more affordable option, especially in prime business districts like Makati, BGC, or Ortigas, where average lease rates for bare shell spaces can be 20–30% lower than fully fitted options per square meter. However, this perceived savings often vanishes when you factor in the fit-out costs, compliance requirements, and time delays that come with turning a shell into a functional workspace.

Fit-out costs for commercial spaces in Metro Manila can be substantial, often ranging from tens of thousands of pesos per square meter depending on the complexity of the design, choice of materials, and level of customization. For example, fitting out a 200 sqm bare shell office can easily result in millions in upfront expenses—before a single employee is onboarded or any operations begin.

Breakdown of Often-Overlooked Expenses in the Philippines

• Interior Fit-Out: Includes construction of internal partitions, ceiling finishes, paint, tiling, lighting, HVAC systems, and restrooms. Labor and materials costs have surged in recent years due to inflation and supply chain challenges.

• Furniture and Fixtures: Custom-built workstations, ergonomic chairs, meeting room tables, filing cabinets, and reception desks can cost hundreds of thousands to millions of pesos, depending on quality and supplier. Since these aren’t bundled in a bare shell, companies must source, purchase, and coordinate delivery themselves.

• Technology Setup: Structured cabling, router and switch setup, IP phones, CCTV, access control systems, and business-grade Wi-Fi are not included in bare shell spaces. This infrastructure can cost ₱500,000 to over ₱1M, depending on the scale and provider.

• Compliance and Permits: In the Philippines, you’ll need multiple local permits before occupying the space: occupancy permits, fire safety clearance, business permits, barangay clearance, and potentially PEZA approval (if within a PEZA zone). This process requires significant time, documentation, and follow-ups with local government units (LGUs).

• Project Management: Fit-out projects often require the hiring of a third-party project manager, interior designer, contractor, and architect. Beyond salaries or consultancy fees, the cost of miscommunication or delays can lead to budget overruns or violations of building codes.

When it comes to real estate, time is just as critical as cost especially for startups, scale-ups, and expanding enterprises that can’t afford operational downtime. Setting up a bare shell office in the Philippines can take anywhere from 2 to 6 months or longer depending on building policies, local permitting timelines, and the complexity of the fit-out.

1. Space Planning and Design Approvals: The design process alone—getting architectural plans approved by the landlord and local city engineering office—can take 2 to 4 weeks, especially in Metro Manila where approvals from the Office of the Building Official (OBO) and fire departments can be notoriously slow.

1. Procurement and Material Logistics: Sourcing furniture, fixtures, and construction materials has become more challenging post-pandemic, with lead times of 2–8 weeks, particularly for imported or custom items. Philippine customs clearance and delivery delays also add time.

1. Construction and Interior Works: Depending on the size and scope, civil works, MEP installation, ceiling and flooring finishes, and system integrations (e.g. HVAC, access control) can take 6 to 10 weeks or more. These timelines are often extended in Class A buildings with strict construction guidelines.

1. Government and Building Compliance: Before occupying the space, businesses must secure an occupancy permit and pass inspections by Bureau of Fire Protection (BFP) and LGUs, all of which can take 2–4 weeks, depending on the city. In cities like Makati or Taguig, even longer timelines are common.

While the office is being built, you’re still paying rent, salaries, and opportunity costs. These delays can lead to:

• Postponed hiring or team relocation

• Delayed client servicing or onboarding

• Lost market opportunities or project momentum

For companies in growth mode, these lost months can translate to millions in unrealized revenue.

Fully fitted offices are designed for speed, simplicity, and scalability, qualities that are especially important for businesses navigating expansion, relocation, or rapid team setup. With plug-and-play configurations, companies can often move in within just a few days and begin operations immediately. No need to coordinate contractors, chase suppliers, or deal with building permits and fit-out approvals.

Everything from furniture and air-conditioning to high-speed internet and IT support is already in place, making it possible to focus on business, not build-outs.

Many providers in the Philippines including KMC, which operates fully fitted spaces in prime business districts, bundle these features into a tailored solution based on your business pace, simplifying office setup across multiple locations.

Are Fully Fitted Offices Less Flexible?

One common misconception in the commercial real estate space is that fully fitted offices lack flexibility, especially when compared to bare shell spaces. While it’s true that bare shell offices offer maximum customization from scratch, fully fitted spaces have evolved significantly particularly in the Philippines.

Today’s providers of fully fitted office solutions, especially in key business districts like BGC, Makati, Ortigas, and Cebu, are responding to the changing needs of businesses by designing spaces that are not only turnkey but also adaptable, scalable, and modular.

As more organizations like startups, remote-first teams, and even established multinationals seek work environments that balance speed, functionality, and adaptability, the demand for fully fitted offices that can be quickly customized has grown steadily. This shift reflects a broader trend: companies want spaces that are ready for business today but flexible enough to evolve with them tomorrow.

In practice, fully fitted offices in the Philippines today offer more flexibility than ever before. Here are some of the options businesses typically have access to:

• Configurable Layouts: Businesses can modify desk arrangements to suit their operations—be it hot-desking, fixed seats, or team clusters. Many providers work with clients to tailor layouts without disrupting the core infrastructure.

• Adjustable Meeting Spaces: The number and size of private rooms or huddle spaces can be adapted. Some providers offer movable partitions, while others allow for retrofitting depending on team requirements.

• Branding and Visual Identity: Even in shared or managed spaces, companies can often integrate branding elements such as logo walls, accent colors, or digital signage, creating a sense of ownership and culture without needing a full interior build-out.

• Scalability: Perhaps the most important form of flexibility is the ability to grow or shrink your space. In the Philippine market, this is especially important for companies managing headcount fluctuations or entering new cities.

Fully fitted offices offer more than convenience. They’re designed to support long-term growth, reduce operational friction, and enhance the overall workplace experience. From cost predictability to faster talent onboarding, here are the advantages that make fully fitted spaces a strategic choice for forward-thinking businesses in the Philippines:

1. Predictable Monthly Costs: Fully fitted offices typically bundle key services such as utilities, internet, IT support, building maintenance, and securityinto a single monthly or yearlyrate. This offers better cost visibility and budgeting control, especially important in the Philippines where variable operating expenses (electricity, maintenance fees) can fluctuate significantly depending on the building and location.

2. No Maintenance Headaches: In a traditional lease, tenants must manage third-party vendors for cleaning, repairs, or IT issues. In contrast, most fully fitted offices in the Philippines include on-site support teams who take care of daily upkeep, ensuring everything from air conditioning units to Wi-Fi networks stays operational which is crucial in tropical climates and older buildings where equipment maintenance is a constant need.

3. Access to Premium Locations: Fitted offices are often located in LEED-certified or PEZA-accredited buildings in prime districts. This includes towers along Ayala Avenue, High Street South, and IT parks in Cebu and Clark. Having a presence in these areas doesn’t just improve logistics, it elevates a company’s brand perception and employee experience.

4. Faster Recruitment & Onboarding: A well-designed, fully functional office can help attract top talent especially in industries like tech, finance, and outsourcing. This is due to candidates increasingly prioritizing workspace quality, access to public transport, and safety when choosing employers. A move-in-ready office in a secure, accessible location checks all these boxes and accelerates employee onboarding.

5. Built-in Amenities that Boost Productivity: Many fitted offices include features like dedicated meeting rooms, executive lounges, breakout zones, high-speed fiber internet, and even wellness areas. These amenities not only reduce the need for external spending but also improve collaboration, team morale, and workplace satisfaction—factors that contribute directly to long-term retention.

Choosing between a bare shell and a fully fitted office depends on your company’s size, stage, and strategic goals.

Use this decision checklist:

• Do you have the capital and time for a complete build-out?

• Do you require highly specific infrastructure?

• Are you looking to move fast and minimize setup hassle?

• Do you want to scale flexibly in multiple locations?

• Do you have in-house resources to manage vendors, compliance, and design?

• How important is workspace experience for your employees?

• Are you prepared for delays due to LGU permitting or building compliance?

• Is long-term lease liability a concern for your business?
  

If your business values speed, cost transparency, operational ease, and the ability to scale across multiple locations, a fully fitted office offers a strategic and sustainable solution. On the other hand, if your operations require highly specialized infrastructure and you have the time, capital, and internal resources to manage a complete build-out, a bare shell space may provide the level of customization you're looking for.

In a fast-moving business environment like the Philippines, your choice of office space can either accelerate or slow down your momentum. Whether you’re entering the Philippine market for the first time or growing your local footprint, choosing the right space and the right partner can make all the difference. But before the first hire walks in, there’s one decision that sets the tone for everything: where will your team get to work?

You’ve seen what each decision offers. Bare shell offices give you full control, and the freedom to build from the ground up. For some businesses, that level of customization makes perfect sense, especially with the right time, capital, and in-house resources.

But for many others—those looking to move fast, stay agile, and stay focused on growth—a fully fitted space removes the noise and gets you straight to what matters: a productive team in a fully operational environment.

Across the country, providers have begun responding to this demand, but not all offer the same level of quality, support, or scalability. That’s why many companies choose to partner with providers that combine design excellence, operational support, and nationwide coverage.demand, but not all offer the same level of quality, support, or scalability. That’s why many companies choose to partner with providers that combine design excellence, operational support, and nationwide coverage.

One such provider is KMC, which offers fully fitted office solutions in over 30 premium locations across Metro Manila, Cebu, and Clark. Their spaces are not only thoughtfully designed and ready for immediate use but also backed by an end-to-end business support services making it easier to expand, relocate, or scale without disruption.

As your business evolves, so should your space. Choose the setup that gives you the clarity, confidence, and capability to keep moving forward.