Determining building classifications is more of an art than a science. There is no formal or international standard. Building classifications change from city to city. Here’s how Reno defines its classes:
Class A buildings are built to impress. These buildings are found in highly desirable areas, constructed with high-quality building materials, and require little if any, deferred maintenance. They typically command the highest rates in the market. Usually, the easiest way to determine a Class A building is by the exterior appearance.
Class B buildings are less impressive than Class A buildings. They are well-maintained and fully functional structures with adequate mechanical, security, and electrical systems. Class B buildings generate average rental rates.
Class C buildings are typically older, outdated, and suffer from deferred maintenance. This is the lowest classification on the spectrum, and these buildings are generally in less desirable locations. They usually need extensive repairs, are structurally obsolete and lack proper technology. Class C buildings get the lowest rental rates and may be more challenging to lease.
Whether you are interested in Class A, B, or C building, Evan Meyer can help. Reach out today!
GET IN TOUCH TODAY
A lease is a legally binding contract that grants tenant-specific rights relating to a piece of land or building. If you are in search of a Reno commercial space for lease, know that there are numerous types of commercial leases. However, most transactions in Northern Nevada are completed using one of the following lease types.
A full-service lease is the most simplistic lease type. In this situation, a landlord will charge the tenant one monthly payment which covers renting the space along with all other expenses related to the building, including but not limited to utilities, maintenance, property taxes, and insurance premiums. Janitorial expenses may also be included.
Pro Tip: Watch out for excess expense clauses. This type of clause protects landlords in the event building expenses exceed a predetermined amount and allows the landlord to bill the tenant for the increase. Consider removing this clause or cap it at a certain percentage.
A triple-net lease or “NNN” lease is essentially the opposite of a full-service lease. For this lease type, a landlord will bill the tenant not only for monthly rent but also for all other property expenses. These expenses commonly include maintenance, property taxes, and property insurance and are billed based on the tenant’s suite size. Lastly, the tenant is normally responsible for its own utilities as well.
Pro Tip: Thoroughly review tenant obligation and maintenance clauses. It is common for tenants to responsible for mechanical systems. To reduce the risk of replacing said systems on your dime, have these systems inspected by a specialist before signing your lease.
A modified gross lease is a hybrid between full-service and triple-net. The terms of this lease type change from landlord to landlord. Typically, modified gross leases in Northern Nevada require the tenant to pay rent and utilities and the landlord to cover all other expenses.
No matter the lease type, it is still a contract and thus negotiable. After all, both parties want an amicable relationship.
If you need commercial space and would like help negotiating your deal, Evan Meyer is an experienced and qualified broker. Ensure that you are properly represented by contacting him today. It is always recommended to have legal counsel review any document you sign.
