Treatment of Incomplete Space in BD+C

Many building projects have some incomplete space when they submit for certification. There are many reasons for this. For example, the incomplete space could be for future retail on the first floor of an office tower; or for a tenant-run cafeteria in a healthcare project; or, for a university holding a floor deliberately vacant for their future needs. Alternatively, the whole interior fit-up may be incomplete under LEED BD+C: Core and Shell (CS).

LEED v4/v4.1 Building Design + Construction (BD+C) was written as a whole building rating system where the building is complete (e.g., fit up installed). To address incomplete space within the review process, further direction is provided in the LEED v4 BD+C Reference Guide (Getting Started introduction and within credit explanations), LEED Interpretations, and USGBC FAQs. The information below summarizes the key direction for project teams. This resource is not meant to supersede these other resources, only to present it in an simple format for review.

What is incomplete vs complete space? 

• ‘Incomplete’ in the context of BD+C means that the building does not have its basic floor, wall, or ceiling finishes installed, or essential mechanical, electrical, plumbing systems or fixtures necessary to occupy the space for its intended use, at the time of certification.
• ‘Complete’ means that no further work is needed and the project is ready for occupancy. Movable furnishings, fixtures, and equipment (FF&E) need not be installed to consider a space/room complete for BD+C rating system selection purposes.” (from USGBC’s FAQ)

How much of the building may be incomplete at project submission?

• Up to 40% for all BD+C projects. A minimum of 60% of the gross floor area is complete at the time of certification with an exception for LEED BD+C: Core and Shell.
• Up to 100% for LEED BD+C:CS projects. All interior work may be incomplete.
  (from USGBC’s Rating System Selection Guidance)

How are occupants determined for the incomplete space?

Future occupancy counts for the incomplete space must be considered. Project teams must use Appendix 2 Default Occupancy Counts (in the reference guide) to establish occupant counts for incomplete spaces. Provide a narrative describing the project’s occupancy. Alternatives to the appendix may be allowed, where appropriate, but provide justification within the narrative.

How are credits with established baselines handled in the review?

All BD+C adaptations, including Core & Shell, are treated similarly for credits with established baselines, such as WE credit Indoor Water Use Reduction and EA prerequisite Minimum Energy Performance and credit Optimize Energy Performance; these must have all spaces included in their calculations, with no exceptions. Note the WE prerequisite Indoor Water Use Reduction is different than the credit, in that project teams will only be held to fixtures and fittings within the scope of work of the project. But for the credit level calculations, the incomplete space must be included, and the fixtures must be considered compliance neutral unless using one of the measures outlined below.

What is ‘compliance neutral’?
This is when the proposed design is held equivalent to the baseline for the incomplete spaces , which allows all floor area to be included in the calculations.

Claiming additional reductions beyond baseline

Project teams that wish to claim additional reductions beyond the baseline for incomplete spaces can do so with the following approaches:

1. For incomplete space being held for future tenants:

A. Binding TLSAs: As noted in the LEED v4 BD+C Reference Guide, project teams can use binding Tenant Lease and Sales Agreements signed by both the owner and future tenant. The TLSA must have binding clauses to hold the future tenant to specific requirements for energy performance and indoor water reduction AND it must be signed by both the future tenant(s) and the owner.

B. Tenant’s Final Construction Drawings with Tenant Commitment Letter: Alternatively, LEED Interpretation 10129 allows project teams to take credit for “measures for tenant spaces documented in the tenant’s final construction drawings” with a tenant commitment letter. While this LEED Interpretation was specifically written for energy performance, it can also be applied to WE credit Indoor Water Use Reduction (as noted in USGBC’s FAQ). The full ruling requires:

“The energy efficiency measures for tenant spaces documented in the tenant’s final construction drawings can be used as part of the LEED Core and Shell energy model if the tenant signs a letter confirming that the final construction documents will be implemented as designed; that any modifications to the final construction documents will be evaluated for their impact on energy efficiency; and that the overall efficiency savings contributed by the tenant improvements will be maintained between the final construction documents and the construction phase.”

If your team would like to apply the LI 10129 guidance to any other credits beyond energy performance and water reduction, please contact LEED Coach Canada and indicate which credits; we will be happy to provide further guidance.

Special direction for LEED v4 BD+C: CS projects

• When installing ‘complete lighting systems’ for future tenants: LEED Interpretation 10463 provides additional information for owners of Core and Shell projects which design, install, and commission complete lighting systems, and demonstrate that the lighting is sufficient for the anticipated tenant uses. Such projects may use the installed lighting power in the Proposed case energy model for EA Prerequisite: Minimum Energy Performance. All relevant ASHRAE 90.1 Section 9.4 Mandatory Provisions must be designed, installed, and commissioned in the tenant space within Core & Shell project scope of work. However, projects installing complete lighting systems in tenant spaces may not claim more than a 20% reduction in lighting power density for the purposes of prerequisite and credit achievement calculations. Alternatively, to claim more than 20% lighting power savings for a complete lighting system, the greater of the installed lighting power or the tenant required lighting power density may be modeled in the proposed case if a binding owner commitment letter with a sample tenant sales and lease agreement is provided establishing tenant lighting power requirements.
• Green Leasing: LEED BD+C: CS projects may use pilot Alternative Compliance Path (ACP) 159 Green Leases which offers up to seven points within EA credit Optimize Energy Performance through green leasing 

2. For incomplete space that the owner intends to fit out themselves in future:

A. Owner’s Final Construction Drawings with Owner Commitment Letter: The LEED v4 BD+C Reference Guide does not offer a path for claiming additional reductions in owner unfinished spaces, however, LEED Interpretation 10129 (designed for future tenant spaces) can be extended to apply to future owner fit-outs (as noted in USGBC FAQ).

The energy or water efficiency measures for future owner fit-out spaces may be documented in the construction drawings as “future” in unfinished spaces if the owner signs a letter confirming that the space(s) will be fitted out by the owner, and verifying that the construction documents will be implemented as designed; that any modifications to the final construction documents will be evaluated for their impact on energy efficiency; and that the overall efficiency savings contributed by the future construction will be maintained between the final construction documents and the construction phase for unfinished spaces. While the text outlines the documentation requirements specific for energy efficiency, it is equally applicable to indoor water fixtures where they are fully detailed in the drawings.

B. Detailed Owner Commitment Letter with Water Fixture Information: Alternately, as mentioned in the USGBC FAQ, for Indoor Water Use Reduction, an owner commitment letter can be used where it is signed by the Owner and indicates that the space(s) where credit is documented will be fitted out by the owner. This letter must include the specific technical details to be carried out by the owner (e.g., fixture flow/flush rates and Water Sense labels as applicable).

How are credits (other than energy performance & indoor water use) impacted by incomplete space?

For credits other than energy performance or indoor water use reduction, the handling of these credits for your LEED submission is different between Core & Shell (CS) and non-CS projects, and the amount of unfinished space in the latter.

1. LEED v4 BD+C: Core & Shell: Only the portions of the project within the LEED scope of work are included in credit calculations and credits can generally be earned without additional measures from future tenant spaces. If a project team wishes to apply for credits that are beyond the scope of design and construction of the LEED project, a tenant sales and lease agreement, signed by future tenants, must be provided. (For example, under EA credit Enhanced Refrigerant Management, the rating system variations note if the project does not include all HVAC associated with anticipated work by the tenant but would like to use those systems to achieve the credit, documentation must be supported the lease agreement.) The lease agreement must be binding and include terms on how credit requirements will be met by the tenant. An unsigned or sample lease agreement is not acceptable. The LEED v4 BD+C Reference Guide under Rating System Variations (within each credit) provides specific guidance where necessary for Core & Shell.

Special direction for Innovation strategies: LEED v4/v4.1 BD+C:CS projects attempting building operations strategies under the Innovation credit, where the building owner/operator has responsibility for these operational strategies, are not required to provide signed and binding tenant sales and lease agreement. Instead, for the strategies needed to meet ‘Innovation – ‘LEED O+M Starter Kit’ and ‘Innovation – Purchasing Lamps’, project teams can document compliance with the requirements based on the project’s scope of work.

2. All other BD+C adaptations:

A. Less than 10% Incomplete Space in the building gross square footage or less than 1860 gross square metres (whichever is smaller):
There is an exemption for incomplete space up to 10% of the building gross square footage or 20,000 gross square feet / 1860 m² (whichever is smaller), as noted in LEED Interpretation 10102 (now extended to LEED v4). For this small amount of area, project teams will not be required to provide additional information to confirm compliance on the interior incomplete area (e.g., an Owner’s Letter of Commitment or Tenant Guidelines) during the LEED certification submittal. However, the incomplete spaces will still be required to be considered for the performance-based credits with established baselines as noted above. Be sure to include a narrative within PI Project Information if applying this interpretation.

B. Greater than either 10% Incomplete Space in the building gross square footage or more than 1860 gross square metres (as per LEED v4 BD+C Reference Guide and LEED Interpretation 10102):

• For incomplete space that the owner intends to fit out themselves in future: Provide a letter of commitment, signed by the owner, indicating that the remaining incomplete spaces will satisfy the requirements of each prerequisite and credit achieved by this project. This letter may cover the commitment in general terms and need not address each prerequisite or credit individually.
• For incomplete space being held for future tenants: In addition to the above, submit a set of nonbinding tenant design and construction guidelines, with a brief explanation of the project circumstances.
  • What’s needed for the Tenant Design and Construction Guidelines? Project Teams can use LEED v4 BD+C: CS SS credit Tenant Design and Construction Guidelines for helpful direction. The guidelines must provide project-specific strategies and information concerning how the future fit-out of the space can fulfill the LEED for Interiors Design + Construction rating systems and how the future fit-out of the space can fulfill the requirements of prerequisites and credits achieved by the completed portions of the project.
• Where it is unknown if the space will be used by the owner or a future tenant: LEED Interpretation 10102 has been extended to LEED v4 and provides additional guidance for this circumstance:
  • It is understood that in some cases the Owner will not be certain about whether the incomplete space(s) in the LEED project will be fit-out by the Owner or a Tenant. In the narrative in the Project Information Form, the project team must explain the basis for their assumptions about who will be fitting-out the incomplete space and then provide the appropriate supplemental documentation as per the requirements above.

Any other advice?

Use the PI Project Information Form: it is critical to describe your project for submission review. Be sure that your narrative covers your project’s scope (breakdown of incomplete space) and expected occupancy to reduce reviewer questions during the certification process. Additionally, for Core & Shell projects, be sure to describe the scope of work that formed the base building and the extent of owner/developer’s control beyond the base building. Include additional supporting information as needed.

Handling a Major Renovation project where some interior space may be left unrenovated: Unrenovated space is not considered “incomplete.” See our August 2023 article on this topic. 

The central source of information on incomplete spaces is within the Incomplete Spaces and Tenant Sales and Lease Agreement portions under Maintaining Consistency in the Getting Started section in the Credit Library / LEED v4 BD+C Reference Guide introduction, as well as LEED Interpretation 10102. For Core and Shell projects, additionally refer to the Rating System Variation sections under Further Explanation within impacted credits in the reference guide. If you have further questions, please contact LEED Coach Canada.