Re: "Loophole" that I don't like
Jeff - Digging in to the EBC, I have found a code path to follow... Let's just call it 'The Long and Winding Road'. I don't know if you will end up with sprinklers, but you should at least get some compartmentation out of it.
Starting with definitions, and moving through the chapters:
ALTERATION. Any construction or renovation to an existing structure other than a repair or addition. Alterations are classified as Level 1, Level 2, and Level 3.
CHANGE OF OCCUPANCY. A change In the purpose or level of activity within a building that involves a change in application of the requirements of this code.
PRIMARY FUNCTION. A primary function is a major activity for which the facility is intended. Areas that contain a primary function include, but are not limited to, the customer services lobby of a bank, the dining area of a cafeteria, the meeting rooms in a conference center, as well as offices and other work areas in which the activities of the public accommodation or other private entity using the facility are carried out. Mechanical rooms, boiler rooms, supply storage rooms, employee lounges or locker rooms, janitorial closets, entrances, corridors and restrooms are not areas containing a primary function.
WORK AREA. That portion or portions of a building consisting of all reconfigured spaces as indicated on the construction documents. Work area excludes other portions of the building where incidental work entailed by the intended work must be performed and portions of the building where work not initially intended by the owner is specifically required by this code.
SECTION 302 ADDITIONS, ALTERATIONS OR REPAIRS
302.1 Existing buildings or structures.
Additions or alterations to any building or structure shall comply with the requirements of the International Building Code for new construction. Additions or alterations shall not be made to an existing building or structure that will cause the existing building or structure to be in violation of any provisions of the International Building Code. An existing building plus additions shall comply with the height and area provisions of the International Building Code. Portions of the structure not altered and not affected by the alteration are not required to comply with the code requirements for a new structure.
302.3 Nonstructural.
Nonstructural alterations or repairs to an existing building or structure are permitted to be made of the same materials of which the building or structure is constructed, provided that they do not adversely affect any structural member or the fire-resistance rating of any part of the building or structure.
302.7 Fuel gas. [FG]
Additions, alterations, renovations or repairs to fuel gas installations shall conform to the International Fuel Gas Code without requiring the existing installation to comply with all of the requirements of this code. Additions, alterations or repairs shall not cause an existing installation to become unsafe, hazardous or overloaded.
Minor additions, alterations, renovations and repairs to existing installations shall meet the provisions for new construction, unless such work is done in the same manner and arrangement as was in the existing system, is not hazardous and is approved.
404.1 Scope.
Level 2 alterations include the reconfiguration of space, the addition or elimination of any door or window, the reconfiguration or extension of any system, or the installation of any additional equipment.
SECTION 406 CHANGE OF OCCUPANCY
406.1 Scope.
Change of occupancy provisions apply where the activity is classified as a change of occupancy as defined in Chapter 2.
701.3 Compliance.
All new construction elements, components, systems, and spaces shall comply with the requirements of the International Building Code.
703.4 Interior finish.
The interior finish of walls and ceilings in exits and corridors in any work area shall comply with the requirements of the International Building Code.
Exception: Existing interior finish materials that do not comply with the interior finish requirements of the International Building Code shall be permitted to be treated with an approved fire-retardant coating in accordance with the manufacturer’s instructions to achieve the required rating.
703.4.1 Supplemental interior finish requirements.
Where the work area on any floor exceeds 50 percent of the floor area, Section 703.4 shall also apply to the interior finish in exits and corridors serving the work area throughout the floor.
Exception: Interior finish within tenant spaces that are entirely outside the work area.
SECTION 704 FIRE PROTECTION
704.1 Scope.
The requirements of this section shall be limited to work areas in which Level 2 alterations are being performed, and where specified they shall apply throughout the floor on which the work areas are located or otherwise beyond the work area.
704.2 Automatic sprinkler systems.
Automatic sprinkler systems shall be provided in accordance with the requirements of Sections 704.2.1 through 704.2.5. Installation requirements shall be in accordance with the International Building Code.
704.2.2.1 Mixed uses.
In work areas containing mixed uses, one or more of which requires automatic sprinkler protection in accordance with Section 704.2.2, such protection shall not be required throughout the work area provided that the uses requiring such protection are separated from those not requiring protection by fire-resistance-rated construction having a minimum 2-hour rating for Group H and a minimum 1-hour rating for all other occupancy groups.
SECTION 707 STRUCTURAL
707.1 General.
Where alteration work includes installation of additional equipment that is structurally supported by the building or reconfiguration of space such that portions of the building become subjected to higher gravity loads as required by Tables 1607.1 and 1607.6 of the International Building Code, the provisions of this section shall apply.
707.2 Reduction of strength.
Alterations shall not reduce the structural strength or stability of the building, structure, or any individual member thereof.
Exception: Such reduction shall be allowed as long as the strength and the stability of the building are not reduced to below the International Building Code levels.
707.4 Existing structural members.
Existing structural components supporting additional equipment or subjected to additional loads based on International Building Code Tables 1607.1 and 1607.6 as a result of a reconfiguration of spaces shall comply with Sections 707.4.1 through 707.4.3.
707.4.1 Gravity loads.
Existing structural elements supporting any additional gravity loads as a result of additional equipment or space reconfiguration shall comply with the International Building Code.
Exceptions:
1. Structural elements whose stress is not increased by more than 5 percent.
SECTION 601 GENERAL (Chapter 7 requires Chapter 6 compliance as well...)
601.1 Scope.
Level 1 alterations as described in Section 403 shall comply with the requirements of this chapter. Level 1 alterations to historic buildings shall comply with this chapter, except as modified in Chapter 11.
601.2 Conformance.
An existing building or portion thereof shall not be altered such that the building becomes less safe than its existing condition.
Exception: Where the current level of safety or sanitation is proposed to be reduced, the portion altered shall conform to the requirements of the International Building Code.
SECTION 602 BUILDING ELEMENTS AND MATERIALS
602.1 Interior finishes.
All newly installed interior finishes shall comply with the flame spread requirements of the International Building Code.
602.3 Materials and methods.
All new work shall comply with materials and methods requirements in the ICC Electrical Code, International Building Code, International Energy Conservation Code, International Mechanical Code, and International Plumbing Code, as applicable, that specify material standards, detail of installation and connection, joints, penetrations, and continuity of any element, component, or system in the building.
602.3.1International Fuel Gas Code. [FG]
The following sections of the International Fuel Gas Code shall constitute the fuel gas materials and methods requirements for Level 1 alterations.
1. All of Chapter 3, entitled “General Regulations,” except Sections 303.7 and 306.
2. All of Chapter 4, entitled “Gas Piping Installations,” except Sections 401.8 and 402.3.
2.1. Sections 401.8 and 402.3 shall apply when the work being performed increases the load on the system such that the existing pipe does not meet the size required by code. Existing systems that are modified shall not require resizing as long as the load on the system is not increased and the system length is not increased even if the altered system does not meet code minimums.
3. All of Chapter 5, entitled “Chimneys and Vents.”
4. All of Chapter 6, entitled “Specific Appliances.”
SECTION 603 FIRE PROTECTION
603.1 General.
Alterations shall be done in a manner that maintains the level of fire protection provided.
Chapter 9 - Change of Occupancy
SECTION 901 GENERAL
901.1 Scope.
The provisions of this chapter shall apply where a change of occupancy occurs, as defined in Section 202, including:
1. Where the occupancy classification is not changed, or
2. Where there is a change in occupancy classification or the occupancy group designation changes.
901.2 Change in occupancy with no change of occupancy classification.
A change in occupancy, as defined in Section 202, with no change of occupancy classification shall not be made to any structure that will subject the structure to any special provisions of the applicable International Codes, including the provisions of Sections 902 through 911, without the approval of the code official. A certificate of occupancy shall be issued where it has been determined that the requirements for the change in occupancy have been met.
901.2.1 Repair and alteration with no change of occupancy classification.
Any repair or alteration work undertaken in connection with a change of occupancy that does not involve a change of occupancy classification shall conform to the applicable requirements for the work as classified in Chapter 4 and to the requirements of Sections 902 through 911.
Exception: As modified in Section 1105 for historic buildings.
Chapter 9 continues with some very good stuff, but this post was getting close to the limit... 
Hope some of it helps.
