Asbuilt Industry News

Measuring Floor Area for Commercial Leases

Wednesday, January 17, 2007

Measuring Floor Area for Commercial Leases

January 2007
The AIA collects and disseminates Best Practices as a service to AIA members without endorsement or recommendation. Appropriate use of the information provided is the responsibility of the reader.

SUMMARY
Six steps to take when measuring a building for lease agreements. When commercial lease rates are scheduled per square foot, it is important that the square-footage measurement is accurate and that the person who measures has the necessary protection in case the measurement is questioned.

THE RIGHT WAY TO CALCULATE AREA
You’ve just designed or renovated a commercial office, retail, or industrial building, and your client has asked you to prepare floor-area measurements for leasing space to tenants. This situation requires specialized knowledge of methods and standards for measuring floor area for leasing. While architects understand buildings and have the best tools, such as computer-aided design (CAD), to accomplish this task, they often have to brush up on published measurement standards and certain legal issues.

CHECK YOUR INSURANCE
Before accepting the work, contact your professional liability insurance carrier or check your policy to verify that you are covered for doing floor-area calculations for leasing. Many policies exclude contractual liability, under which this falls. Riders can be purchased to cover this, however.

CHECK YOUR CONTRACT
Make sure that your scope of work includes lease area calculations and that you will be compensated for them. Lease area calculations are not part of normal design services and often contribute to “scope creep”—tasks added to the scope of work after your agreement is signed. They take time to do and to document, and you should be paid for them.

CHECK THE LEASE
The lease agreement between the landlord and tenant contains important language about the measurement method specified for lease area calculations. Often, it will specify a published measurement standard, such as ANSI/BOMA Z65.1-1996. Other leases may be less specific. You should have a copy of the lease in your file, have studied the section on “Premises,” and clearly understand which measurement standard or method it specifies.

OWN THE MEASUREMENT STANDARD
Obtain a current printed copy of the measurement standard or method specified in the lease. The $30 to $40 cost is peanuts compared to the liability you could face in a lawsuit over area calculations. Keep in mind that standards change every few years. Because not all properties use the most recent version of a standard, it is useful to retain copies of older versions that are normally out of print.

DOCUMENT EXCEPTIONS
If your client specifies exceptions to a published measurement standard, clearly document those exceptions in a letter to the client along with your recommendation that the lease document those exceptions. You are not practicing law here; you are protecting yourself from liability. Keep in mind that lease agreements often last longer than property ownership, so your current client may be long gone when someone finally gets around to questioning your area calculations, which the lease must support.

MASTER THE MEASUREMENT STANDARD
If you are not experienced in applying a measurement standard, attend a class or seek online training. Measurement standards are more complex and specific than you might think. For example, you should expect to spend at least three hours of study to understand the BOMA standard if you are not already familiar with it. Training on it can qualify for AIA/CES learning units