Other Measuring Methods

Other Office / Warehouse Methods of Measuring

There is no legislation requiring building owners and managers to use any particular measuring standard to determine rentable areas. The lack of restrictions building owners and managers have in determining rentable areas may give prospective tenants more ability to negotiate the terms of a lease, particularly how much gross-up may be applied to their usable area. Below are some common alternative methods of determining rentable areas.

Fixed Gross-Ups

Building owners and managers will often measure a tenant's usable area according to a particular standard, method or lease definition and apply a fixed gross-up for the common expenses. The fixed gross-up may be complex-wide building-wide, floor-wide or tenant specific. This method is most often used when a building contains so much common area that applying the real proportionate share of common areas to a tenant would result in an unmarketable gross-up.

Capped Gross-Ups

Building owners and managers will often form an agreement with a prospective tenant which specifies that the gross-up percentage will not exceed a certain amount (usually based on market competitiveness). If it is determined that a tenant's actual gross-up percentage exceeds the capped gross-up percentage (according to a particular standard or method), then the capped gross-up percentage will be used. If it is determined that the actual gross-up percentage is less than the capped gross-up percentage, then the actual gross-up percentage would be used.

Lease Definitions

When preparing a lease, building owners and managers will often specify the method of measurement in legal sentences rather than referring to a measuring standard such as BOMA 1996. Most of the time, the method is actually based on an existing standard but fails to specify the intricacies of a standardized method. As long as the lessor and lessee agree to the terms of the lease, there is nothing wrong with using lease definitions.

Extreme Measures Inc. specializes in and has developed systems that calculate square feet according to any measuring standard or lease definition.

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