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REBNY Standard

rebny

INTRODUCTION

The Real Estate Board of New York, Inc. pamphlet entitled RECOMMENDED METHOD OF FLOOR MEASUREMENT FOR OFFICE BUILDINGS (1987) is the standard for measuring office space in the New York Metropolitan area as well as nearby New Jersey and Connecticut. Unlike the twenty five (25) page, in-depth offering from BOMA (Building Owners and Managers Association) International, this pamphlet, written in 1987, offers only the very basic principals in which to measure. It is so vague in its explanations that it has not needed an update in over 20 years, yet the construction industry changes and improves almost daily. This page is dedicated to deciphering the REBNY standard with concise explanations and graphics to help us all understand what the REBNY standard means in today’s real estate market.

PREFACE

It is not uncommon for an area calculated from original plans to vary from the area that is measured during a field survey. It is also not uncommon for a site measurement done by one party to vary from a site measurement done by another party. Typically there is a two percent (2%) or less variance allowed between calculations. If there is a difference greater than two percent (2%), it is recommended that an unbiased third party be hired to re-measure and resolve the matter. Also, if you have any questions regarding verbiage, please check our DEFINITIONS page.

DECIPHERING THE CODE

REBNY (Real Estate Board of New York)
RECOMMENDED METHOD OF FLOOR MEASUREMENT
FOR OFFICE BUILDINGS
Effective January 1, 1987

In order to facilitate a comparison of the cost of space among buildings, The Real Estate Board of New York, Inc. recommends that owners use a standard definition of usable area and that they clearly explain how rentable area is calculated based upon such usable area. Architectural plans and calculations should be made available to the tenant if requested.

The Real Estate Board of New York, Inc. recommends the following definitions and methods as the Standard Method of Floor Measurements in office buildings. Any Board member who advertises office space for rent is expected to follow these guidelines in determining any rentable area count mentioned in the advertisement.

RENTABLE AREA:

Because of dissimilarities among buildings, calculations of rentable area may vary. If requested, owners should disclose to prospective tenants the loss factor used for spaces under consideration.

Loss factor means that each tenant is paying for more space that they actually occupy. In addition to their space, they are responsible to pay their portion of common areas throughout the building. To a tenant this would be considered a loss. Buildings are all different in how much Common Areas they have. The national range is usually between 8-25%, but New York City is usually around 15-30%. No building is required to give accurate numbers. If a space is measured with a 10% factor, they can rent space at a 15% factor in order to make more profit. The factors vary from floor to floor, so a building may also use one fixed (usually average) factor for the whole building. There are no guidelines for this.

Example: A tenant is looking at two (2) spaces in two (2) different buildings that are both 10,000 square feet. One building could have a load factor of 10% and the other is at 20%. This means the tenant will be paying for 11,000 square feet or 12,000 square feet respectively. At $2 per square foot per month ($22,000 or $24,000), over a five (5) year lease, that is $1,320,000 (10%) vs. $1,440,000 (20%). That is a difference of $120,000. The tenant may have thought that they would only be paying for 10,000 square feet at $2 per foot over five (5) years, which is $1,200,000.

When all that matters in making a deal is dollars and cents, the bottom line for the tenant is to get a low loss factor.

CONTINUE