Does your building have Class? A Guide to Building Classifications
What do you want from your building? Is it the location on top of the metro or the rooftop deck? Or maybe it’s the parking or the tenant-only fitness center? Do you want efficiency in design or do you want high-end finishes and a concierge in the lobby getting your dry cleaning? The answers to these and other questions help define a building’s classification and provide a standard by which a tenant judges and compares buildings. In general, buildings are classified as Class A, Class B or Class C. While there is no concrete formula or national standard for defining a building’s classification, the general guidelines for the Washington, DC region are as follows:
Class A buildings have typically been built within the last ten years or are older buildings that have been renovated to provide the highest end construction and finishes. The building’s infrastructure provides efficiency and flexibility including column spacing greater than 20 feet by 20 feet. The heating, venting and air conditioning (HVAC) system is flexible and allows each tenant to control their own suite temperature. The building is prominently located (typically on the corner of a block) and is within a few blocks of metro-rail. Class A buildings provide amenities including parking, concierge service, as well as security in the lobby, a rooftop deck and a tenant-only fitness center. The building has first-class on-site management that maintains a high level of service for its tenants. In Washington, DC Class A rental rates are currently approximately $55.00 per square foot and higher.
Class B buildings were built in the last twenty to thirty years. While the finishes may have been maintained over the years, the infrastructure is less efficient and flexible for tenant use. Floor plates are smaller than Class A buildings and the column spacing is typically not greater than 20 feet by 20 feet. The HVAC systems range in quality but do not provide for tenant flexibility. Class B buildings typically will not provide the type of amenities and location that are found in Class A buildings, including parking, on-site management, etc. Class B buildings provide tenants with a cost effective option in comparison to Class A buildings. The rental rates in Washington, DC currently range from $40.00 per square foot up to $55.00 per square foot.
Class C buildings are older and in many cases obsolete buildings that offer no-frills space. The infrastructure and finishes are outdated, inefficient and inflexible. These buildings provide little if any on-site amenities and simply offer a cost-effective leasing option in comparison to Class A and B buildings. Class C buildings offer tenants rental rates below $40.00 per square foot. While cost effective, most of these buildings are slated for re-development and can provide uncertainty for a tenant over the longer term.
In today’s market, building owners are doing what they can to differentiate their building from other buildings in the marketplace. Whatever it is that you’re looking for in a building, knowing the classification system will help you determine if your building has class.