This week's edition of Explainer discusses the three different classifications for office space as designated by The Building Owners and Managers Association. The highest classification available—Class A—is currently in hot demand in Downtown Toronto, with a number of office towers under construction and proposed addressing the market demand, including the recently completed east tower of the Bay Adelaide Centre (pictured below), the under-construction EY Tower a block to the west. (More office developments are linked at the bottom of this page.)

 Office Space ClassificationsBay Adelaide Centre East Tower's minimalist envelope, image by Jack Landau

The Building Owners and Managers Association — an organization for commercial real estate professionals — grades office buildings according to their competitive ability to attract similar types of tenants. A building's rating depends on a variety of factors including rent, finishes, system standards and efficiency, amenities, location, and market perception. 

The grading system is broken down into three distinct categories. The 'Class A' designation is afforded to "prestigious" buildings which compete for "premier" office users. Rent at these properties is usually above the neighbourhood average. They typically feature high-quality finishes, state-of-the-art building systems, and easy accessibility. 'Class B' office space is characterized by average rents and finishes comparable to other buildings in the area. 'Class C' buildings compete for tenants "requiring functional space" at below-average rents. They are typically defined by older technologies and antiquated infrastructure. They may also be located in less desirable areas. A building's grade is relative to other properties in a given market. Therefore, a Class A building in a small town compared to Class A space in Manhattan will not share the same qualities.

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