Distinguish Between Gross Area And Net Area In Detail

When needing to rent an office, many people will surely encounter the concept of the GROSS area and NET area. However, not everyone clearly understands the difference between these two types of areas and their impact on office rental prices.

Therefore, this article Rsquare will provide you with the information you need to know about the GROSS area and NET area, helping you better understand and choose the office that suits your needs.

1. What is the gross area?

Gross area (GFA): Is the entire area of a building, including floor area, corridors, elevators and other public areas. This is the area calculated during the construction process and is often used to calculate construction and building management costs.

For businesses that rent the entire floor area, it can be said that the floor area is the GROSS area.

2. What is the net area?

Net area (NLA): Is the actual area of an office or workspace, including floor area and areas used for private purposes such as restrooms, break rooms, and dining rooms. This is the area used to calculate space rental and usage costs.

For some buildings, the NET area may include the area of pillars on the floor or not if the building has a structure with many columns or large columns.

The NET area is often separated from the public areas by glass doors or partitions; In fact, public areas such as toilets, lobbies, hallways, elevators, stairs… are not included in the NET area – therefore, businesses do not have to pay rental fees for this area.

Most Grade A and B professional office buildings calculate NET area when calculating rent for tenants.

3. Notes on area when renting an office

When looking to rent an office and survey the rental space, you need to keep in mind some things to do before renting an office as follows:

Choose to suit your needs

When renting an office, you need to clearly determine the needs of your business to choose the appropriate area.

If you are not careful in choosing the area, your business may have to pay excess money for space that is not needed or does not meet its needs.

Legal conditions

Before renting an office, you need to carefully check the legal conditions related to the rental such as business license, business registration certificate, land use rights certificate… to avoid legal disputes and cause damage to businesses.

Costs are related to area

In addition to office rental prices, you also need to consider other costs related to the area such as maintenance costs, cleaning costs, electricity and water costs, management costs, service costs… to get an overall view. Pay attention to costs and make the most reasonable office rental decision for your business.

Pay attention to the terms of the lease

Before signing an office lease contract, you need to carefully read and understand the terms of the contract to avoid risks that arise during use.

Terms to pay attention to include rental terms, rental price, payment conditions, privacy policy, rights and responsibilities of the lessee and lessor, contract renewal conditions…

4. By what method is the rental area determined?

Grade A, B, C professional office buildings only charge rent for the areas actually used by customers. There are 3 methods of measuring area as follows:

• Measure the clearance, inside the office.
• Measure along the center of the wall and the wall surrounding the office.
• Measure along the outside edge of the wall and the wall surrounding the office.

The method of measuring according to clearance is less than 3 – 5% of measuring according to the construction area (outer edge of the wall).

Pay attention to areas that are not useful

These are dead corners, areas that cannot be used for anything, or offices with irregular shapes (not rectangular or square), offices with many columns leading to an increase in the area that is not useful.

Re-measure the office area before signing the lease contract

The area given by buildings is not always accurate, so re-measuring the area is a must.

The difference in area does not increase the cost per month, but over the entire term of the 3-5 year contract it is a significant number. So to ensure benefits, both parties should re-measure to determine the exact office area before signing a lease contract.

Above are some experiences about renting offices and notes regarding NET area and GROSS area.

Hopefully this article provides enough information so you can identify each type of area when renting. For support on office rental services and how to negotiate the best rental price, you can contact Rsquare Vietnam for support.