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Defining the ABCs of commercial office space

Dale Beede

You see the term used all the time, “For lease, 2,500 sq ft. class A office space…”  But what does that really mean?  When you Google “Class A” an interesting list pops up describing Class A as everything from a portion of our airspace in pilot terms, to a lower level of minor league baseball, to a type of motor home and finally a type of driver’s license.  Many people call their own building space Class A simply because they believe it is nicer than their neighbor’s similar space next door.  Others consider their 1965-built industrial building as Class A because “everything works” or it has a new cooling system, etc.  So what does Class A really mean when it comes to properties?  We must first visit the site of BOMA, the Building Owners and Managers Association.  BOMA sets the standards for everything in commercial real estate from a building’s grade (Class A, B and C properties), to measurement specifications and how to determine the differences between rentable square feet, useable square feet and a building’s total size as measured in square feet.

            BOMA classifies office space into three categories: Class A, Class B, and Class C.  According to BOMA, Class A office buildings have the “most prestigious buildings competing for premier office users with rents above average for the area.” BOMA states that Class A facilities have “high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence.” BOMA describes Class B office buildings as those that compete “for a wide range of users with rents in the average range for the area.” BOMA states that Class B buildings have “adequate systems” and finishes that “are fair to good for the area,” but that the buildings do not compete with Class A buildings for the same prices. According to BOMA Class C buildings are aimed towards “tenants requiring functional space at rents below the average for the area.” (Quoted from Wikipedia)

            This information now begs the question, “Are there many Class A buildings in Grand Junction?”  The answer is yes…there are several.  One of the most discriminating methods of classifying between Class A and Class B status deals with the building’s technology.  For example, modern office buildings allow for space, either above the ceiling or below the floor, for modular hookups for everything from telephone, high-speed internet, Wi-Fi, electrical, networking, music, etc. In addition, heating and cooling systems may be diffused through this space.  Space is easily remodeled simply by moving a partition and disconnecting and reconnecting the needed equipment for that space.  Class B properties are usually wired for high speed internet or cable, but usually were built prior to the availability of today’s high-tech gadgetry.  Remodeling space in a Class B building may involve adding new technology as well as floor, ceiling and wall finishes.  Many buildings classified as Class C buildings require the tenant to bring in their own dish, cable or T1 lines if they require high-speed internet, and remodeling for tenant finishes may be very expensive, but the rents are usually quite affordable. 

            When considering potential lease space for your company, it is usually wise to first list all the items that must be included in that space to enable your business to operate easily and profitably.  When combined with budget considerations, you then have a shopping list from which to judge competing properties.

About
Dale Beede, a Certified Commercial Investment Member, is broker and partner of Coldwell Banker Commercial Prime Properties in Grand Junction. Reach him at 243-7375. For more information about Coldwell Banker Commercial Prime Properties in Grand Junction, log on to www.grandjunctioncommerical.com.
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Posted by on Mar 30 2012. Filed under Focus On. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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