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The ABC's of Building Class

by Lynn Blakeley

If you are in the market for office space, you have probably seen numerous properties identified as  "Class A" buildings and you may be wondering what this means.  Like many terms thrown around in real estate, there is a bit of a disconnect between what the term is actually supposed to mean and how it is applied in practice. There actually is a formal definition for the term, but like the superlatives  "First Class" and "Premium, a lot of wishful thinking goes into its applications for many landlords.

The formal definitions for building classes are promulgated by the Building Owners and Managers Association (BOMA) and can be found here.  They go like this:

Class A

Most prestigious buildings competing for premier office users with rents above average for the area. Buildings have high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence

Class B

Buildings competing for a wide range of users with rents in the average range for the area. Building finishes are fair to good for the area. Building finishes are fair to good for the area and systems are adequate, but the building does not compete with Class A at the same price.

Classs C

Buildings competing for tenants requiring functional space at rents below the average for the area

An obvious factor that comes into play with the foregoing definitions is that the designations are clearly market specific.  What counts as a “Class A” building in one market may be a solid “B” in a larger City. As a tenant, it is also important to realize that neither BOMA nor anyone else provides an official class designation for individual properties. Building owners who tout their properties as “Class A” have achieved this status through self-designation.  

You don't have to look too far before you realize that there is quite a bit of grade inflation going on in real estate marketing.  The situation is analagous to Lake Wobegon, "where all the children are above average".  About the only thing you can be confident of is that if someone touts their property as "Class A", they are hoping or expecting to get top rental rates.  Whether those rates are justified is another story.

Questions about Office Leasing?

In the posts below we address many of the issues that routinely come up in office leasing. Check out the posts or just give us a call to discuss your specific concerns: 210.349.6111.

How Tenant Rep Brokers Get Paid

Rentable Square Feet and the Common Area Factor

Types of Commercial Leases

It's All about the Base

How much Office Space Do You Need?

Lynn Blakeley represents tenants in office lease transactions. Call Lynn at:

210.349.6111.