Office rent reviews are commonly analysed by reference to an overall rental rate per square foot or square metre, but the quality of the building and transaction terms can be as important as the headline rate.
What affects office rental value?
Location, transport links, floor level, natural light, floorplate efficiency, lifts, air conditioning, raised floors, reception, end-of-trip facilities, parking and the overall specification can influence value.
Headline and effective rent
Office lettings frequently include rent-free periods, capital contributions or other incentives. Evidence should be analysed carefully rather than relying solely on the headline rent.
Floor-by-floor differences
Different floors in the same building can command different rents depending on outlook, accessibility, size and specification. Evidence should be reconciled to the particular premises under review.
Lease assumptions
The hypothetical term, repairing obligations, permitted use and assumed condition may all influence the rent review valuation.