When planning a new medical, dental, or allied health clinic in Victoria, one of the first and most important conversations you’ll have with your builder and landlord will involve Category 1 (CAT 1) and Category 2 (CAT 2) works.
These terms often appear in commercial lease agreements and project scopes, but many clinic owners don’t fully understand what they mean—or how they can impact costs, timelines, and even compliance.
At SoulMed, we help our clients navigate this process from the start, ensuring that the base building works (Category 1) and tenant fit-out works (Category 2) are clearly defined, coordinated, and executed without costly surprises.
What Are Category 1 and Category 2 Works?
Category 1 Works (CAT 1) – Base Building Works
CAT 1 works are generally the landlord’s responsibility and relate to preparing the space to a basic operational level before the tenant begins their fit-out.
This may include:
- Base flooring or concrete slabs
- Walls, ceilings, and basic finishes
- Base lighting and essential power
- Plumbing rough-ins (often to certain points)
- Air conditioning and ventilation (basic provision)
- Fire services (sprinklers, smoke detectors)
- Main switchboards and essential electrical capacity
The scope of CAT 1 can vary significantly between landlords. In some cases, the landlord may deliver a “cold shell” (bare structure) with minimal inclusions, while others may deliver a “warm shell” with partial finishes.
Category 2 Works (CAT 2) – Tenant Fit-Out Works
CAT 2 works are the tenant’s responsibility and involve all the specific modifications and finishes needed to make the premises operational for your particular use.
This may include:
- Internal partition walls and doors
- Specialist flooring (e.g., vinyl for clinical areas)
- Cabinetry, joinery, and work surfaces
- Specialty lighting and controls
- Additional plumbing (sinks in consult rooms, sterilisation areas, etc.)
- Medical gases, suction, or lead shielding (if required)
- IT, security, and AV systems
- Branding and signage
- Patient amenities fit-out
Essentially, CAT 2 works transform the base building into your fully operational clinic.
Why It’s Critical to Clarify CAT 1 vs CAT 2 Early
Many project delays and budget blowouts come from unclear boundaries between landlord and tenant works. If the lease or agreement doesn’t clearly define responsibilities, you risk double-paying or having important services left out entirely.
Common risks include:
- Plumbing depth and location: If sewer points aren’t in the right place before flooring is finished, relocating them later can be costly and disruptive.
- Electrical capacity: Upgrading electrical infrastructure after the base build is complete is far more expensive.
- Air conditioning zoning: Many clinics require more zones than base building systems provide.
- Fire services: Sprinkler and smoke detector layouts often need adjusting for partition walls—doing this later means reworks and added cost.
Best Practice: Engage Your Fit-Out Builder Early
One of the most effective ways to avoid CAT 1/CAT 2 headaches is to involve your builder before the landlord finalises base building works.
At SoulMed, we:
- Review lease and base build drawings to identify potential gaps.
- Provide a preliminary floor plan so the landlord can incorporate key CAT 1 elements early (e.g., plumbing, electrical capacity, ceiling height).
- Negotiate with landlords on your behalf to include certain works in CAT 1 scope, reducing your CAT 2 costs.
Example Scenario
Without early coordination:
- Landlord completes base build without consulting your fit-out needs.
- Sewer points end up 3 metres from where your dental chairs will be.
- After moving in, you discover the issue, requiring jackhammering and re-laying floors—adding weeks to your timeline and thousands to your budget.
With early coordination:
- Floor plan prepared before base build completion.
- Sewer points, power outlets, and air conditioning zones aligned to your layout.
- Smooth transition from CAT 1 to CAT 2 works—no delays or unexpected costs.
Key Questions to Ask Before Signing Your Lease
- What is the full scope of CAT 1 works?
- Who is responsible for compliance with healthcare-specific building codes?
- When will CAT 1 works be completed, and will I have access before handover?
- Can I review and approve CAT 1 designs before they start?
- Will the landlord contribute financially to CAT 2 works?
Understanding and correctly managing Category 1 and Category 2 works is essential for budget control, timeline management, and compliance in your medical fit-out.
By clarifying responsibilities early and involving your fit-out builder from the beginning, you can save significant time, money, and stress.
Thinking about your clinic fit-out?
SoulMed specialises in helping healthcare professionals across Melbourne and Victoria navigate the CAT 1/CAT 2 process seamlessly. We’ll ensure your clinic is designed for compliance, efficiency, and patient comfort—right from day one.
Call us on (03) 5900 4964
www.soulmed.com.au
