A rentable area survey to sell a property
What was required by our surveyors?
Kennards Hire, one of our long-time clients, moved their local retail outlet to a larger site that was one block down the road. Therefore they wanted to put the current property on the market for sale. Neither they, nor the Christchurch Council, had any current building plans on file. The Realserve surveying team in Christchurch was contracted by Kennards and their sales agent to produce a Rentable Area Survey (or Boma) for the Information Memorandum.
The majority of older sites across the city of Christchurch lack any kind of plan for their Rentable Areas. This makes it hard for owners and sales agents to advertise a property on the market without an accurate BOMA / Property Council of NZ measured plan. Older premises were often settled at the time of purchase with valuation measurements, or “hand shake” agreements. BOMA/ PCNZ measured plans in many instances have never been produced in follow-up for final appraisal, although a local surveyor can create these relatively easily.
Kennards Hire wanted to put the property to market with accurate area information and with a plan that showed the various ways the premises were divided up including the detail of the numerous rooms it had. Valuation assessments are not accurate enough when working out the differences between Showroom Rentals and Warehouse / Back of House Rentals for example.
The difference in these values could equate to thousands, if not tens of thousands of dollars in rental amount differences over a year.
Rentable area survey vs a valuation assessment
Both rentable area surveys and valuation assessments serve different purposes and can provide valuable information in the context of real estate transactions and property management for retail, industrial or commercial sites. The choice between the two depends on the specific goals and needs of the parties involved. The Realserve team of surveyors in Christchurch or Auckland can help you determine what will be most suitable;
Accuracy of Rentable Area Measurement: A rentable area survey involves accurately measuring the usable and leasable spaces within a property, such as offices, retail spaces, or apartments. This is important for determining accurate rental rates and for allocating expenses among tenants. A precise measurement ensures fairness and transparency in rental agreements.
Fair and Transparent Rental Agreements: Rentable area surveys help landlords and tenants establish fair rental agreements based on the actual usable space. This prevents disputes and potential legal issues arising from discrepancies between stated and actual square metres.
Cost Allocation in Multi-Tenant Buildings: In commercial or multi-tenant properties, accurate rentable area measurements are essential for allocating common area maintenance (CAM) charges, property taxes, and other expenses among tenants. This helps ensure each tenant pays their fair share based on the space they occupy.
Lease Negotiations and Tenant Satisfaction: Accurate rentable area measurements provide a solid foundation for lease negotiations. Both landlords and tenants benefit from clear and transparent terms that are based on the actual space being rented. This can lead to improved tenant satisfaction and longer-term lease agreements.
Legal Compliance and Risk Mitigation: Precise rentable area measurements can help property owners and managers comply with local regulations and industry standards. This reduces the risk of legal disputes and potential financial liabilities.
Property Management and Investment Decisions: For property managers and investors, accurate rentable area data is crucial for making informed decisions about property management, maintenance, and investment strategies. It allows for better financial forecasting and planning.
Due Diligence and Documentation: Rentable area surveys provide documented evidence of the property’s size and layout, which can be useful during due diligence processes, property audits, and financial reporting.
While rentable area surveys are important for rental and property management purposes, valuation assessments are essential for determining the overall market value of a property. Valuation assessments take into account various factors, such as location, market trends, property condition, and comparable sales, to estimate the property’s worth.
How did we complete this rentable area survey in Christchurch?
We arranged access with the local branch manager and took some time to walk through the site with them. We quickly determined that this site had several additions over the years varying in quality of build. And there were also some areas that had suffered from the earthquakes. It was still a functioning branch for Kennards too, so we needed to work around their racking and storage systems to find the best solutions for measurement.
We used a traditional surveying method measuring the exterior of the building first, then moving inside to capture some of the main features of the internal fitout. This allowed us to lock in the shape of the overall structure and the glazing lines hidden behind fitout and racking. We then moved inside to measure the various rooms, doors, columns and layouts with hand held laser devices to add the requested deeper details to the plan.
What was the scope of work for our surveyor at this site?
The scope of work for our surveyor in Christchurch for this Rentable Area Survey, or BOMA Plan, in Christchurch included the following;
- Creating documentation that could clearly articulate the clients desire to show the layout of the premises using an accurate BOMA/ PCNZ survey
- Making sure all Rentable Areas were calculated in accordance with the guidelines set out in the Property Council of New Zealand’s “Method of Measurement.”
- Clearly demonstrating why and how we came to our conclusions considering the building was duel use, both industrial and commercial.
- Completing all the site measurements as required and then producing all the required documentation.
- We also completed a Site Plan as well as a Marketing Floor Plan which complimented the Rentable Area Survey documentation by providing a comprehensive set of materials that could be used by the real estate agent and prospective buyers. It provided instant access to the existing conditions of the site that could be used for making decisions on how best to use the property if it was purchased.
- We created a Rentable Area Survey, or BOMA plan, that showed the layout along with all required areas.
- The survey plans produced made it very easy for any interested party to do their own due diligence on the building to determine how it could be reconfigured, and the different rental rates that would come from it.
We find that a large majority of older buildings in Christchurch only have the basic valuation areas given. They lack the higher details that our Floor Plans can show, and more importantly, they lack the details for inclusions and exclusions that the PCNZ Guideline for Measurement, or BOMA, requires
What other survey documentation could have been produced?
The surveying team at Realserve are able to deliver a wide range of survey documentation in either 2D or 3D formats. For this site it could have been possible to also create a
3D Interactive Floor Plan
, or Matterport Virtual Tour. This is a virtual view of the site that enables someone to ‘walk’ around and inside different areas of the building via their laptop or computer without needing to visit the location. Using the latest 3D laser scanning equipment we capture every part of the site to then create the virtual views.