As an architect who specializes in commercial office space, I am often asked to help interpret the areas of buildings. Unfortunately, many of these requests come after a purchase has already been made based on gross figures. While the gross area is valid and useful, “rentable” area per BOMA (Building Owners and Managers Association International) standards is the most widely accepted.
A savvy buyer or renter may request rates based on the rentable area, which is always smaller than the gross area. Here are some terms and concepts related to BOMA standards that businesses should consider before buying or renting.
Although the calculations can be quite complex, three basic terms are “Rentable Square Feet” or RSF, “Usable Square Feet” or USF, and “Building R/U Factor” which is commonly referred to as a “Core Factor.” The Rentable area is essentially the interior of the building without vertical penetrations (usually stairs, elevators, and mechanical shafts).
The Usable Area for a tenant suite is typically what they can put furniture in. USF is measured from the dominant face of the exterior wall (often times measured to the interior glass pane if it is the majority of the vertical face) to the inside face of common walls and to the center line of the demising wall (the wall the tenant shares with neighbors). Structural members, such as columns, are always included as part of the USF.
To get the “Core Factor” the public elements such as corridors, elevator lobbies, bathrooms, janitor’s closets, mechanical rooms, even shared conference rooms and fitness centers, are measured and then sorted into floor common and building common categories. These figures form ratios in a complex formula that eventually produces a building factor, or “core factor,” to be multiplied against a tenant USF to charge each occupant their portion of the common amenities. These days, when an office building development is being considered, these numbers should always be calculated early in the design of the building. The area calculations can influence decisions such as using a certain window manufacturer that has the glass surface closer to the exterior or changing the corridor paths to eliminate the need for a third stairwell. Both increase the rentable area, which maximizes the profit of the developer.
The gross area, or footprint of the building, must also be given to the municipalities on a building’s documentation. It is different than RSF because it includes the thickness of the exterior walls and the vertical penetrations, therefore it is a larger number than the RSF. The gross area is a real number and often, the property taxes are paid on this number (although I have seen clients negotiate a lower tax rate when they prove they can only generate income on the rentable area).
Often, the gross number is how the building is marketed for purchase later. We recommend that clients who are considering a purchase include BOMA calculations as part of their due diligence study. If someone chooses to convert a building that is documented only in gross square feet to the BOMA standard, the building “shrinks,” which never makes investors happy. If the numbers are converted to BOMA standards, the rates must increase to keep the property successful and of course, the rates need to be evaluated for competitiveness in today’s market.
To learn more about this common and complicated issue, visit www.boma.org.
The author, Jennifer Keaton, is a registered Architect and Interior Designer and Owner of the firm Red Design Studios. Learn more about her work at www.reddesignstudios.com. She can be reached at Jennifer@reddesignstudios.com or 512-207-0141.