GLA in CRE is an abbreviation for gross lettable area, or gross leasable area. Also known as “rentable area” (or RBA), it is normally expressed as square meters or square feet.
High-level explanation of GLA
This is the space that a commercial property landlord bases her rent and expenses charges to a tenant on.
Gross lettable area / gross leasable area / GLA can be comprised of space like office, warehouse, factory, or shops.
Other – tenant costs
- The space categorised as GLA is used to assign both rentals and expenses to tenants. For example, let’s say there is 150 sqm of office. Office rental of R120 / sqm and rates and taxes recoveries of R25 / sqm will be applied to the 150 sqm.
- Another category of space (falling outside the definition of GLA) is: Supplementary area – rent attracting (but not expense attracting). This is generally made up of space such as storage (office), terrace, yard etc. While a space-driven rental is charged, expenses for this space are not allocated to the tenant. For example, let’s say there is a terrace of 20 sqm. Terrace rental at R60 / sqm will be charged on the 20 sqm space (but no share of the other costs will be assigned to the 20 sqm).
Insider info for GLA
The values displayed for rent by landlords are generally inclusive of common facilities aka “common areas“**. Thus, your paced-out area occupied (aka usable area) is different to the GLA value that is on your rental invoice. (Whether this is perceived right or wrong – there are cases for both arguments – this is the global industry standard)
Dealing with an example
- You as tenant see 500 sqm rentable area / GLA on your rental invoice / lease agreement / offer to lease.
- You pace out your office, but count only 450 sqm (usable area)
- That extra 50 sqm is your calculated pro rata share of the common facilities/”common areas” (required for your 450 sqm usable area to be “live-able”)
- 450 sqm usable area + 50 sqm common facilities/”common area” space = 500 sqm
- Calculation of the 50 sqm common facilities/”common area” share: the 450 sqm is 10% of the total 4,500 usable area office space. The common facilities/”common areas” are 500 sqm. 10% x 500 sqm = 50 sqm
More technical information regarding GLA
For ease of understanding, space is classified below according to how both rent and expenses are charged / not charged to tenants. This may vary from landlord to landlord, but the below represent the general case.
GLA or RBA includes:
- Primary space (aka usable area) such as offices, warehouse, factory, shops, and
- Common areas / common facilities ** (aka standard facilities) integral to the building such as
- Shared (horizontal) circulation areas (including enclosed walkways and passages between buildings)
- Stairs, escalators, lifts/elevators (i.e. non-horizontal circulation areas),
- Changing rooms, guard houses, ablutions, cleaners’ cupboards
- Plant rooms, lift motor rooms, maintenance rooms
- Canteen, day care facilities, fitness areas and prayer rooms
GLA or RBA excludes:
- Other areas
- Supplementary area – rent attracting (but not expense attracting)
- Storage (office), terrace, yard, parking areas (generally rented on a per-bay basis)
- Supplementary area – not rent attracting (and not expense attracting)
- Balcony, decks, patios
- Supplementary area – rent attracting (but not expense attracting)
- Not supplementary area (neither space rent nor expense attracting)
- Lawn, external car parking, equipment yards, cooling equipment
Another category of space is non-GLA space that attracts rent – for example signage, routers and towers. Solar plant is, for now, classified in this category.
IPMS 2 according to the International Property Measurement Standards Coalition*** includes both
- GLA / rentable, and
- Supplementary area – rent attracting.
IPMS 2 excludes (but requires it to be separately stated)
- Supplementary area – not rent attracting
- Not supplementary area
Even more technical information
Mapping IMPS 2 Office and IPMS 2 Industrial to practical terms
GLA includes:
- “Primary space” or “usable area” such as offices, warehouse, factory, shops | “Area B” and “Area G“
- Common facilities / “common areas”** (aka standard facilities) integral to the building’s operation such as
- Shared (horizontal) circulation areas (including enclosed walkways and passages between buildings) | “Area E” and IPMS 2 – Inclusions
- Stairs, escalators, lifts/elevators (i.e. non-horizontal circulation areas) | “Area A”
- Changing rooms, guard houses, ablutions, cleaners’ cupboards | “Area D“
- Plant rooms, lift motor rooms, maintenance rooms | “Area C“
- Canteen, day care facilities, fitness areas and prayer rooms | “Area F“
GLA excludes:
- Other areas
- Supplementary area – rent attracting (but not expense attracting)
- Storage (office), terrace, yard, internal parking areas – e.g. basement bays (generally rented on a per-bay basis) | Falling into “Area H“
- Supplementary area – not rent attracting (and not expense attracting)
- Balcony, decks, patios; internal loading bays, mezzanines | “Area H” and IPMS 2 – Included but state separately
- Supplementary area – rent attracting (but not expense attracting)
- Not supplementary area (neither space rent nor expense attracting)
- Open external stairways (e.g. open framework fire escape); open light wells / upper level voids of an atrium; lawn, external car parking, equipment yards, cooling equipment and refuse areas; external loading bays, sheltered areas outside external wall | “Any other areas“, “External car parking“, “Decks, patios not forming part of the building structure” and IPMS 2 – Excluded but state separately
*** International Property Measurement Standards Coalition is a global body of industry experts who seek to standardise CRE terms. The hope of this (at last count) 89 member body is to reduce the confusion, and provide consistent measurement standards for the industry. IPMS 2 was formalised in November 2014.
Rationale: “Current terminology used to describe floor area (such as rentable area, usable area, leasable area, net internal area, net lettable area and carpet area) means different things in different markets. This results in confusion for owners and occupiers working internationally. For example, an organisation occupying 10,000 sqm in one country could find the identical space described as 12,000 sqm, or 129.1K SqFt in another”
