BOMA International
®
Foundations of
Real Estate Management
®
Module 1: Real Estate Administration
Leasing and Marketing
Objectives
 Identify the following characteristics as
they relate to commercial properties:
 Product Type
 Market
 Submarket
 Class
 ENERGY STAR®
 Green building certifications
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Objectives
 Explain the value of optimizing energy
and environmental performance, and
describe the benefits that an ENERGY
STAR®, BOMA 360®, LEED®, or other
certification delivers to a building owner
 Understand the various BOMA
measurement standards, including how to
identify which standard to apply to
different product types and leasing
circumstances
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Objectives
 Define and relate the following terms from
the BOMA Office Standard to one
another: Exterior Gross Area, Interior
Gross Area, Rentable Area, Occupant
Area, Service and Amenity Areas, the
Load Factor; and understand distinctions
between Methods A & B
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The Brokerage Firm
 Brokers v. agents
 Broker owns business relationship
 Agent works for broker
 Leasing transactions
 Landlord representative
 Tenant representative
 Dual agency
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Broker Compensation
 Almost always commissions
 May also be equity in the
assignment
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Agent Compensation
 Agent compensation is a fraction
of the broker’s commission
 Commission only
 Salary plus commission
 Salary
 Equity
 Needs to cover “desk costs”
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Real Estate Markets
 Markets
 Submarkets
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Supply and Demand
Factors impacting rents
 Relationship to rental rates
 Absorption
 Calculating absorption
 Vacancy
 Elasticity
 New construction
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Product Type
 Office Buildings
 Retail
 Industrial
 Residential
 Medical Office
 Mixed Use
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Classes
Factors that determine class
 Building finishes
 Physical attributes
 Amenities
 Location, accessibility
 Market perception
 Security
 On-site management
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Classes
 Metropolitan
 Trophy
 Class A
 Class B
 Class C
 International
 Investment grade
 Institutional grade
 Speculative grade
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Putting it Into Practice
Work with your instructor to
complete the workbook assignment
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Sustainability Measures
 ENERGY STAR®
 BOMA Energy Efficiency Program
(BEEP®)
 Leadership in Energy and
Environmental Design (LEED®)
 BOMA 360® Performance Program
 Green Globes
 BOMA BEst(Canada)
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Putting it into Practice
How would you describe your building?






Product type
Market
Submarket
Class
ENERGY STAR®?
LEED®, BOMA 360®, other?
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Benchmarking Financial Performance
BOMA’s Experience Exchange
Report (EER)
 Building demographics
 Income data
 Expense data
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Measurement Standards
 BOMA’s Floor Measurement Standards
 Office Buildings: Standard Methods of Measurement (2010)
 Industrial Buildings: Standard Methods of Measurement
(2009)
 Mixed-Use Properties: Standard Methods of Measurement
(2012)
 Multi-Unit Residential Buildings: Standard Methods of
Measurement (2010)
 Retail Buildings: Standard Methods of Measurement (2010)
 The Gross Areas of a Building: Methods of Measurement
(2009)
 All are ANSI approved
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Measurement Standards
BOMA’s Office Buildings: Standard Methods of
Measurement (2010)
 Tenant spaces v. common spaces
 Occupant Area
 Area occupied by tenant
 Service and Amenity Areas (Common Areas)
 Areas shared by tenants
 Rentable Area
 Occupant Area + Service and Amenity Areas
 Number that appears in lease
 Exterior Gross Area (EGA)
 Interior Gross Area (IGA)
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Measurement Standards
BOMA’s Office Buildings: Standard Methods
of Measurement (2010)
 Load Factor
 Ratio between rentable area and occupant area of
a floor
 Method A – Legacy Method
 Calculates load factor uniquely for each floor
 Method B – Single Load Factor Method
 Calculates rentable area for each floor using a single load
factor
 Must choose either Method A or Method B for the entire
building; can’t mix the two
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Components of a Lease
 Letter of intent (LOI)
 Lease agreement
 Rental Rate
 Gross lease
 Net lease
 Percentage rent
 Ground rent
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Components of a Lease
 Tenant improvement (TI)
 Turn key v. allowance
 Who will manage?
 Drawings
 Space plans
 Construction drawings
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Real Estate Manager’s Role on Leasing Team
 Keep space ready for lease at all
times
 Selective demolition and minor
improvements
 Your business card may say
“Real Estate Manager,” but you
play an important role in the
leasing process
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