Definition
Gross Leasable Area (GLA) refers to the amount of floor space in a building or property that is available for lease. It encompasses the total area designed for tenant usage, usually measured from the centerline of shared walls to the exterior surface of outside walls. GLA is a critical metric used by property managers and investors to determine potential income from rental spaces, evaluate property sizes, and facilitate comparisons between different properties.
Examples
- Shopping Malls: In a shopping mall, the GLA would include the retail spaces offered to tenants like stores, restaurants, and service shops but would exclude common areas such as walkways, escalators, and food courts.
- Office Buildings: For an office building, the GLA would consist of the areas within offices that are rented out to various businesses, excluding areas like lobbies, stairwells, elevators, and hallways.
- Industrial Parks: In industrial parks, GLA includes warehouse and manufacturing spaces available for lease to different companies but excludes communal spaces, utility rooms, and parking areas.
Frequently Asked Questions (FAQs)
What is included in GLA?
GLA includes all areas designed for tenant use, such as office suites, retail stores, and industrial spaces. Common areas like hallways, lobbies, restrooms, and mechanical rooms are generally excluded.
How is GLA measured?
GLA is measured from the centerline of shared walls between tenants and to the outer surface of exterior walls.
Why is GLA important for investors and property managers?
GLA helps determine the rentable space, which in turn affects possible income from leasing and valuation of the property. It also aids in comparing different properties objectively.
Does GLA include outdoor spaces?
Typically, GLA excludes outdoor spaces unless they are expressly part of the tenant’s lease, such as designated patio spaces or garden areas.
How does GLA affect rental rates?
Rental rates are usually based on the GLA, meaning that the more leasable space, the higher the potential rental income.
Can GLA numbers change?
Yes, reconfigurations, renovations, and expansions can alter the GLA of a property over time.
Related Terms
- Net Usable Area (NUA): The actual area that can be used exclusively by tenants, excluding common areas and structural components.
- Rentable Square Footage (RSF): A combination of both the tenant’s leased area and a proportionate share of the building’s common areas.
- Common Area Maintenance (CAM): Charges that tenants pay for the upkeep of shared spaces such as lobbies, restrooms, and hallways.
- Base Rent: The minimum rent payable under a lease, usually calculated per square foot of GLA.
Online Resources
- CoStar: Extensive commercial real estate data and analysis. CoStar
- BOMA International: Provides standard measurement practices for commercial real estate. BOMA International
- Commercial Real Estate Terms: Glossary terms explained. CRE Terms
References
- Baum, A. (2009). “Commercial Real Estate Investment: A Strategic Approach”. Springer.
- International Council of Shopping Centers (ICSC). “Shopping Center Definitions: Basic Configurations and Types”.
Suggested Books for Further Studies
- “Commercial Real Estate Analysis and Investments” by David M. Geltner and Norman G. Miller.
- “Property Valuation” by Peter Wyatt.
- “Real Estate Investment: Strategies, Analytics, and Sources of Funding” by David M. Geltner.
