The Royal Institution of Chartered Surveyors (RICS) has introduced a new standard that will bring transparency and consistency to global real estate markets.
The International Property Measurement Standard for Offices (IPMS for Office Buildings) came into effect on January 1. It replaces the existing Code of Measuring Practice and is in line with the International Property Measurement Standard (IPMS), and developed by the IPMS Coalition (IPMSC), an independent group of 73 professional bodies from around the world and will be used by all RICS professionals unless instructed otherwise in writing by the client.
The International Property Measurement Standard for Offices (IPMS for Office Buildings) is the result of a global effort to create a uniform method for measuring property and is set to replace dozens of existing standards currently in use around the world.
In 2013 commercial property market transactions were estimated to be more than $1trillion worldwide according to Real Capital Analytics, with investors and corporate occupiers increasingly operating across international borders. Despite this, many of the standards used within the industry are local market specific, making consistency and comparability a significant challenge.
IPMS for Office Buildings will lead to increased transparency and consistency across real estate markets that will benefit the way property assets are managed and, ultimately, how financial decisions are made by investors, corporate occupiers, buyers and sellers.
Historically, property has been measured differently throughout the world. According to research by global property firm JLL, depending on the standard used the area quoted in different markets for an equivalent building could vary by as much as 24per cent.READ ALSO – Surveyors Canvass Professionals’ Synergy On Mega City Challenges
These inconsistencies have led to confusion in markets, and even led businesses to develop their own costly processes for measuring and benchmarking property assets. Investors too, including pension funds, have had to factor in variation in quoted property size when making decisions about acquiring new property.
The work to create this new global measurement standard has been spearheaded by a Coalition of more than 50 professional organisations and has been produced following global consultation by a team of 18 independent industry experts. The new standard will define which areas are included when measuring a property and which are not.