The different grades of office buildings
There has been much recent talk in the commercial property sector regarding a lack of Grade A office stock. What does Grade A mean and what other grades are there?
Office property is usually given one of three classifications: Grade A, B or C in order for those in the commercial property industry to compare and calculate the price of the property. The grading process is seen as subjective as there is no international standard but here are some general guidelines to the different classifications.
Grade A– This top grade is generally for new or completely redeveloped office buildings in a high visibility location. The premises will have high standard fixtures and technology. A lot of high rise buildings come under this category as they tend to be naturally lit, spacious, with high ceilings and so demand a higher rent.
Grade B-This office space will have adequate but fully functional systems with fair to good finishes and are located in a less desirable location. It is often applied to older buildings and grade A offices can be downgraded to this level once wear and tear sets in.
Grade C– Usually applied to buildings that are over 20 years old, often needing repair, with out of date technology and are situated in the least desirable locations. Rents will be below average.