Tenants who occupy Class B buildings don’t necessarily need to be right in the middle of the action, nor do they need an outward display of prosperity, but they want to ensure employees have a comfortable, modern workspace. They may have on-site parking but it’s uncovered. Buildings offer HVAC and elevator systems that are functional but not top of the line. They’re typically older but still have higher-quality tenant improvements (although finishes may be somewhat outdated). They’re well-located in solid markets but might be just outside a central business district. These businesses are often found in financial districts and may provide professional services like law firms, architecture firms, advertising agencies, or financial management companies.Īmenities in Class A office buildings can include (but are not limited to):Ĭlass B buildings “compete for a wide range of users with rents in the average range for the market.” They’re generally nice, fully-functional buildings but don’t typically boast the same high-end fixtures, architecture, and striking lobbies as Class A buildings. Tenants who seek out Class A properties are usually businesses for whom office space is not just for employees, but also for clients -and they want to give a top-notch impression. In other words, these buildings are built to impress. Class A buildings aren’t always newly built - older distinguished buildings with outstanding ownership in prime markets are often Class A due to their market presence (think Rockefeller Center).Ĭlass A boasts high-end tenant improvements and high-quality, first-class finishes, high-tech security, the latest in elevator and HVAC systems, and state-of-the-art technological capabilities. These are the “most prestigious buildings competing for premier office users with rents above average for the area,” and they have a “definite market presence.” Class A buildings have a prime central location with exceptional accessibility and are usually of significant size. Here’s a rundown (with a little help from BOMA ): These can all determine whether or not a property is rated as Class A, B, and C office space. While it varies from firm to firm, criteria that brokers typically use to classify buildings includes: age of the building, location/accessibility, infrastructure, technological capabilities, rental rates, market perception, quality of the HVAC system, how well it’s maintained, finishes, tenancy, ownership, and of course, amenities. “BOMA has a standard it goes by, but it’s still totally subjective by whoever puts the listing in.” “It’s all subjective,” said Coy Davidson, Senior Vice President at Colliers International in Houston, to VTS. Groups like BOMA International and NAIOP offer broad descriptions of the three classes, but it’s simply a framework open to interpretation. What about all the space in between these extremes? And what do the “Class A, B, and C” rankings really mean and who determines them?ĭespite attempts to classify the quality of space, there’s really no hard-and-fast official grading system, and brokers in their individual markets don’t operate under a single set of definitions for each class. However, classifying office space isn’t always this cut and dry. When it comes to office space, it’s pretty clear that the glamorous downtown tower with imported Italian marble in the lobby and concierge or valet services is classified as “Class A” in the world of commercial real estate.Īt the same time, it probably comes as no surprise that the no-frills space with its paneled walls and fierce fluorescent lighting located in a less-than-prime part of town is likely designated “Class C.”
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