UK: Measuring Up: What Do The New IPMS Standards Mean For The Measurement Of Buildings?

Last Updated: 12 July 2016
Article by Claire Haynes

The measurement of a building is central to its valuation and for multi-let buildings the rent and service charge calculations. This makes it important for property industry stakeholders that the underlying measured areas of buildings are correct.

From January 2016 the 'RICS Property Measurement Professional Statement (1st edition)' became mandatory for property measurements undertaken by RICS professionals. The Statement advises how to measure all types of buildings, however there is a new standard for the measurement of office buildings, 'International Property Measurement Standards: Office Buildings'. The existing 'Code of Measuring Practice (6th edition)' continues to apply for other classes of building. Unlike previous measuring standards the Statement is mandatory for RICS professionals to ensure that it is used in practice.

Why are the International Property Measurement Standards (IPMS) needed?

Commercial property is increasingly becoming a global market place. This has led to demand for a uniform measurement system enabling property measurement information to be compared and benchmarked on the same basis around the world.

Research by JLL shows that depending on the current measurement method used, there can be a difference of up to 24% in the floor space of a property. Different countries and markets have varying interpretations of the meaning of established measurement terms such as gross external area, gross internal area, net internal area and net lettable area. This has created uncertainty and confusion for global property investors and occupiers who face inconsistencies resulting from the varying measurement methods used across their property portfolios.

Office buildings were prioritised by the IPMS as the first class of buildings to be given a new standardised measurement procedure because of their international nature and concerns raised by those operating in the global office market place.

What is IPMS?

IPMS stems from a coalition of experts from around the world who have worked together to establish a consistent methodology for measuring office buildings across the globe. A 'Standards Setting Committee' was created to develop a new measurement standard which would enable buildings to be measured, and the resulting calculated areas to be provided on a transparent basis no matter where in the world the building is situated.

What are the new IPMS standards?

IPMS decided to establish new measurement standards to eliminate inconsistencies and any hangovers from existing measuring regimes. IPMS has created three new standards:

  • IPMS 1 – this standard will be applied to all classes of building and is used to measure the external area of a building. A need was identified for an external measurement standard to enable costing of development proposals and for planning purposes.
  • IPMS 2 – there will be separate standards for categorising internal areas for different classes of building. In the new IPMS: Office Buildings, this standard is referred to as IPMS 2 – Office.
  • IPMS 3 – areas in exclusive occupation will vary for different classes of building and so separate standards will be used for each class of building. IPMS 3 – Office applies to measurement of office space.

The Committee considered it unrealistic to create a single standard for all classes of buildings as each type of building has distinctive characteristics. Residential, industrial and retail will all be similar, but not identical and a mixed use class would incorporate elements of each.

Will there be an impact on existing agreements and buildings?

If an existing agreement prescribes that an office building should be measured, or a rent review or service charge carried out using measurement standards prescribed by the Code, the parties should continue on this basis.

In a multi-let office building, if the existing leases and service charge have been established using measurements carried out pursuant to the Code, unless the whole building is re-measured and changed to the new standards it may not be wise to use the IPMS for new leases at the building. The building areas calculated using IPMS will be different than if measured using the Code, potentially creating confusion and uncertainty.

Where existing legal agreements provide for measurement using the Code or an updated measurement standard, measurement using IPMS will be permitted without the need to renegotiate documents.

It is anticipated that for a number of years the new IPMS will run alongside the existing Code, whilst office buildings transition over to the new standards. In the future, the same will apply for different classes of building. There is no requirement for existing buildings to be re-measured using the new IPMS standards.

What will be the future impact of the new measurement standards on buildings and legal agreements?

Going forward IPMS should be adopted for all new office buildings and used in agreements in cases where there is no conflict with the Code. Where documents are being negotiated for other classes of building, such as retail or industrial, they should include wording to provide for measurement using the Statement (1st edition) or any updated measurement standard recommended by RICS.

It will soon become usual practice for office buildings to be measured using IPMS. There will be a transitionary period where both the existing standards under the Code and new IPMS standards for office buildings will operate side by side. As the new IPMS standards are issued for other classes of building, they will become common place across the UK property industry and around the world.

Measurements using IPMS will potentially increase the measured area of buildings. As long as the new standards are applied consistently there should be little impact on the resulting valuations, rent calculations or service charges.

A consultation by IPMS on its proposed standards for residential buildings concluded in September 2015. A draft of the new IPMS standards for residential buildings is expected shortly for further consultation. Consultations on IPMS for industrial buildings and thereafter retail buildings and land will follow. Further changes to the new RICS Property Measurement Professional Statement are therefore close on the horizon.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

    Disclaimer

    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

    Registration

    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

    Cookies

    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

    Links

    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

    Mail-A-Friend

    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

    Emails

    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

    Security

    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions