Why pay rent a place that you do not occupy?
Commercial real estate is surrounded by many concepts that tenants and even real estate professionals misunderstand. An example is the measurement of office space for rental purposes. The method used to determine the amount of rent in most offices includes both the usable area and the proportional tenant share of the most common places in the building.
Useful square feet
Useful square meters have been used in many areas when it comes to office space. What does it mean? Well, a useful frame is the amount of space in which you live. For smaller tenants, a usable square meter is an area of mine clearance located inside your office, with no exceptions for entrance or exit doors or structural columns. This means that space is measured as if there are no columns. However, things like cleaning cabinets, toilets, elevator lobbies and public corridors exist, and you only pay for the space they occupy with other tenants who use these facilities.
Well, for full or multi-storey tenants, the useful square foot includes everything inside the glass line, including wiper cabinets, toilets and electrical rooms. Therefore, like other tenants, full or multi-storey tenants must also pay part of the total area or space in the building.
Total area ratio
What is this factor? This is a number that refers to common spaces on the same floor within a given building. Spaces can be proportionally distributed between common areas, such as elevator lobbies and toilets, and sometimes the main buildings and amenities used by all residents in the building.
Moreover, this factor is divided into two categories;
· Total floor area ratio; this reflects the common areas used by the tenant only on this floor. Rooms may vary from building to building, but this is eight percent of the floor factor.
· Construction of the total area ratio; reiter for common areas intended for all tenants in the building. It ranges from 6 to 8 percent.
In general, general area factors help determine the actual areas that should be paid by tenants. If the landlord or other leasing agent quotes the total area ratio, it includes the total amount of the floor and building area ratio. This means that the overall overall ratio for most office buildings ranges from 12% to 20%, depending on the building design.
Rent Square foot
The area of the rental area is defined as the area of the internal space enclosed in a specific building, dropping holes in the floor, such as stairwells, as well as an elevator and a mechanical channel space. Regardless of what you can afford, you have to pay for it, because it is a rented place. This includes janitorial cabinets, toilets, electrical and telephone rooms to mention a few.
To calculate a rented square meter, say, a specific tenant, all you have to do is multiply the effective square meter by the total floor ratio, and then multiply the result by the total building ratio.
The following formula can determine the rented square feet Vs;
Rsf = usf x (+1 Add-on%)
Add-On% = (leased sf / used sf-1)
comparison various buildings
When evaluating space parameters, it is important to remember that most buildings have different common area factors, as well as the size or shape of the floor slab. These factors may affect the space plan and the size of the usable area more. When comparing different buildings from aspects such as finance, it is crucial to use the price for a useful square meter (USF) to ensure an excellent assessment of your options.
Of course, you need the right space that fits your budget and job criteria. But two buildings with the same rental rate have different profitability due to the factors of the total area and space design issues.
For this reason, it is good to work with a good expert on the representative of the tenant who clearly understands all the details of renting office space. He must have good technical skills to evaluate various options in order to arrive at a comprehensive solution.
