Space Measurement Checklist for CRE Due Diligence:
Buying, Selling, Refinancing, or Leasing Buildings
SELLERS should review and validate rentable areas before listing a property to see if they can increase the square footage to maximize the sale price and avoid liability exposure for overstated areas.
BUYERS should always validate the square footage the seller is listing to avoid overpaying or under-buying their needed usable area. With accurate RSF data in hand, buyers can find new ways to maximize revenue once they take over the asset.
REFINANCERS need the up-to-date RSF measurements to accurately support net operating income (NOI) calculations and property valuations. Precise data strengthens your position with lenders, helps optimize loan terms, and ensures your property is represented accurately in financial analyses.
TENANTS need to verify the RSF detailed in your lease agreements and any proposed measurements during renewals or expansions. Clearly, agreed-upon measurements protect you from overcharges, support fair negotiations, and reduce the risk of disputes over rentable area and operating expenses.
If you’re buying, selling, refinancing, or leasing a commercial property, be sure to use this checklist as you do your due diligence to ensure you have the most up-to-date RSF data.
Choose a measurement standard that aligns with your leases and market expectations.
Selecting the appropriate measurement standard is essential to ensure that your rentable areas match the terms of your leases and reflect market expectations. Aligning your building's measurements with the correct standard not only protects rental income but also enhances transparency with tenants and investors, supporting fair negotiations and reducing the risk of disputes.
Confirm how spaces may have changed since prior measurements.
It is said that a BOMA measurement is like a picture in that it is only a snap shot in time. Buildings change and it is important to capture changes since last measurement, including renovations, reconfigurations, or tenant improvements. Even small modifications can significantly impact usable and rentable areas, so a current assessment helps maintain leasing accuracy and prevents billing errors or misunderstandings with tenants.
With the advent of Lidar laser scanning, an expert in the field is uniquely qualified to quickly capture scans and provide updated drawing while minimizing disturbances to the site.As part of compliance with their standards, BOMA International recommends that all source information be maintained in as current and accurate condition as possible. Inaccurate, incomplete, or antiquated information can directly impact area calculation outcomes and may present a liability when used in the course of business.
Engage Qualified Measurement Experts
Today’s measurement standards are complex and regularly updated, making expert guidance essential for correct application. Qualified professionals ensure your building is measured accurately and in full compliance with the latest standards. They provide detailed, comprehensive reports that document assumptions, calculations, and floor plans clearly, supporting confident leasing decisions, operational planning, and legal defensibility.
Cite the chosen standard and edition clearly in all documentation.
Always specify the exact measurement standard and edition used in your reporting and lease documents. This clarity ensures all parties understand the basis of area calculations, facilitates fair comparisons in the market, and provides vital legal protection by reducing ambiguity in lease agreements and negotiations.
The BOMA standard requires that all documents (such as leases, agreements, appraisals, area summary charts, area certificate letters, and floor plans, etc.) must cite the standard and method used in unambiguous language. These will vary based on the standard used, but here is an example for siting the latest BOMA Office standard: BOMA 2024 for Office Buildings - Standard Methods of Measurement (ANSI/BOMA Z65.1- 2024 Method A).
Obtain a well-documented, defensible measurement report.
Insist on a measurement report that is clear, thorough, and defensible, with complete calculations, floor plans, and methodology explanations. A well-prepared report not only supports leasing and operational decisions but also provides essential evidence in the event of audits, disputes, or financing reviews, reducing long-term risk.