Magazine article Journal of Property Management

Comparing Apples to Apples: IREM and 60 Professional and Not-for-Profit Organizations Come Together to Form the International Property Measurement Standards (IPMS) Coalition

Magazine article Journal of Property Management

Comparing Apples to Apples: IREM and 60 Professional and Not-for-Profit Organizations Come Together to Form the International Property Measurement Standards (IPMS) Coalition

Article excerpt

[ILLUSTRATION OMITTED]

Measuring space in an office building seems simple enough: Get a tape measure, measure the space and it's done. But measuring commercial space is not nearly as easy as it sounds.

A trip around the world quickly reveals that how space is classified and how real estate is measured differs from one country to another, and even from one building to another, within the same country. For example, are balconies classified as part of the saleable area of a residential unit? Are common areas such as corridors and washrooms included in the leasable area of an office building? What happens if a building sits on top of a parking garage containing the mechanical rooms that service the building?

Consider this:

* In India, off-site areas such as automobile parking lots and common areas can be included in a building's measurement.

* In Spain, the measurement may incorporate outdoor leisure facilities.

* In some parts of the Middle East, hypothetical floors--floors that could be supported by the building structure--may be included.

* In some countries, only air-conditioned space can be counted.

WHEN 1 + 1 DOESN'T ALWAYS EQUAL 2

Depending on the method of measurement used, the area quoted in different markets for an otherwise identical building could vary by as much as 24 percent, according to some estimates. The result is confusion in the market among buyers and sellers and among tenants and owners, making it difficult to compare one offer to another and make informed decisions. Confusion damages transparency, and lack of transparency hurts business.

This was the driver behind nearly 60 professional associations and not-for-profit organizations coming together to form the International Property Measurement Standards (IPMS) Coalition. The coalition, of which IREM is a part, represents the gamut of professions that affect and are affected by the built environment: real estate property and asset managers, appraisers, architects, agents, developers, assessors and civil engineers.

The result of this global effort is International Property Measurement Standards for Offices (IPMS for Office Buildings), released in November and containing three components.

IPMS 1 is for measuring the area of a building, including external walls, and applies to all types of buildings. It constitutes the sum of the areas of each floor level of a building measured to the outer perimeter of external construction features and reported on a floor-by-floor basis.

IPMS 2--Office is for measuring the interior area of an office building, defined as the sum of the areas of each floor level of an office building, measured to the internal dominant face and reported on a component-by-component basis for each floor of a building.

IPMS 3--Office is for measuring the occupation of floor areas for exclusive use.

IPMS office was developed by an independent standard-setting committee comprising real estate experts from around the world, drawn from all sectors of the industry, and utilizing a transparent, detailed and inclusive process coordinated by the coalition.

CREATING UNIVERSAL STANDARDS

With 11 different countries represented, the standard-setting committee became a microcosm of working on a global platform. Committee member Nicholas Stolatis, CPM, said that given the different geographic and business backgrounds, the biggest challenge was leaving existing standards at the door. …

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