Is it Class A office space or simply “new, classy and with lots of cool doodads”?
If you have considered leasing office space in Boise anytime during the last 20 years you probably have heard the term Class A. But is the building deserving of a Class A designation, or is that just a marketing claim? The listing of which actual buildings are considered Class A, B, and C is a local decision. But most building owners and developers always refer to their buildings as Class A, regardless of the location, construction, or design.
Office buildings are generally classified as Class A, Class B, or Class C. The difference between each of these classifications varies by market, and class B and C buildings are generally classified relative to Class A buildings. In Boise, the Class A designation is generally misused to demote new construction.
In reality, the age of the building is but one factor. If age was the deciding factor, you could say all new cars are Class A in luxury or performance. If you’ve ever driven a brand new Gremlin, you know that’s simply not true.
Let’s consider how the term Class A came to be and how it is commonly used in other parts of the United States. Class A steel frame construction became associated with city highrises in the early 1920s. Initially, Class A was a description of the basic building construction and materials such as steel framing, that allowed buildings to reach greater heights. Wood frame or masonry/brick materials were limited in what they could carry. Wood frames were unable to resist lateral forces (i.e. wind and seismic), and masonry construction needed to be very thick and solid at the lower floors, which greatly reduced openings for windows. Consequently, Class A was originally used to describe multi-floor, steel constructed buildings. It morphed into a term to demote quality later.
I asked Tom Zabala, a founding principal of ZGA architects with over 30 years of experience, if he was aware of a commonly accepted practice or definition to designate Class A office buildings. According to Tom, “There is no simple answer or uniformly accepted definition (of Class A space) because various national and international organizations across the country define it differently. One thing to consider about building classifications is that buildings should be viewed in context and relative to other buildings within the sub-market; a Class A building in one market may not be a Class A building in another.”
Tom went on to say, “One of the more generally accepted descriptors is provided by the Building Owners and Managers Association (BOMA) that classifies office space into three categories:
Class A office buildings are the most prestigious buildings competing for premier office users with rents above average for the area. BOMA states that ‘Class A facilities have high quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence.’
Class B office buildings are those that compete for a wide range of users with rents in the average range for the area. BOMA states that Class B buildings have ‘adequate systems’ and finishes that ‘are fair to good for the area,’ but that the buildings do not compete with Class A buildings for the same prices.
Class C office buildings are aimed towards ‘tenants requiring functional space at rents below the average for the area.’
The definitions provided by BOMA leave a little bit of room for interpretation. Basically they are saying Class A offices are “new, classy and have lots of cool doodads.”
It may go without saying that Class A offices are the most prized and sought-after offices. They are often new construction or have been recently redeveloped to a very high standard that allow them to compete with other newly-built office structures. They are fitted-out to top quality standards, complete with sleek design, state-of-the-art technologies and required infrastructure, top-notch furniture, excellent accessibility and professional management.
Class A offices are well-located relative to the needs of the major tenant sectors in the marketplace. Building systems (mechanical, HVAC, elevator, and utility) can meet current tenant requirements and well as anticipated future needs. The building finishes have high quality design and tenant finishes are characterized by efficient layouts and the best quality trim and interior finish. Building services are characterized by above-average maintenance, management and upkeep. Occupying a Class A office boosts business image, so many top companies are willing to pay more expensive rates in order to secure the very best properties in recognized locations.
Class B offices are located in average-to-good locations relative to the needs of major tenant sectors in the marketplace, appeal to a wide range of companies and are typically available in less exclusive areas. The buildings are of good quality and design but are older and characterized by some functional obsolescence or deterioration. Building systems (mechanical, HVAC, elevator and utility) have adequate capacities to deliver services currently required by the tenants. Tenant finishes are characterized by fair-to-good quality trim and interior finish. The building services are characterized by average-to-good maintenance, management and upkeep.
Occupying a Class B office is often more affordable for small or medium businesses. While Class B offices fall below the quality of Class A offices, they are not considered sub-standard. In fact, some Class B offices are ex-Class A properties.