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  • Writer's pictureTom Miller, CCIM

Industrial Building Classifications Explained

If you are in the process of leasing or buying an industrial building or space, you may hear agents or property managers referring to building classifications. It is important to understand these classifications when discussing budget, criteria and use. Class A buildings sound amazing, but you probably won’t need one if you’re a start-up machine shop. And, conversely, Class C buildings are more affordable, but if you need to set up a laboratory or clean room, you’ll likely have to pass. Here is a quick explanation of the three main classifications.

Class A Industrial

These facilities are top of the line, and they feature the most high-tech, state-of-the-art systems, including:

  1. Fast, reliable internet services (many times this means fiber)

  2. HVAC

  3. LED lighting

  4. Security

  5. And many other features

Class A building are usually newly constructed and well located with ample parking. Construction of Class A is usually impeccable with a high-quality infrastructure. These higher-end buildings may even have amenities for employees, such as a fitness facility, and they usually have the best property management people. Due to the high quality, rates for spaces in these buildings will likely be at the top of the market.

Class B Industrial

Class B is, logically, a step down from what you get in the Class A tier. These buildings may be a bit older, though they will usually have a decent property management company that is willing to work with you on repairs. Lease rates will usually be somewhere in the middle of the market, which will attract all kinds of users. The finishes will be fair to good, but not high end. In class B facilities you will find function over form. Still, this tier is a solid middle-ground option and ideal for investment.

Class C Industrial

This is the lowest classification, and these buildings are usually the oldest eye-sores in town. Systems in these facilities  may be out of date as well. Some of the Class C properties in northern Nevada don’t have reliable internet connections. Other issues might include inefficient lighting, plumbing and heating. Class C buildings command the lowest rental rates and listing prices, but buyer beware, these properties do not work for every use. They tend to have unpermitted structures or electrical, and it can be costly to get them up to snuff.

There are a lot of qualities a tenant or buyer needs to consider when they are shopping around, and the best way to approach a purchase or lease is to hire a qualified industrial agent. We spend quite a lot of time in each building class and with all kinds of users. We can help you navigate what to look for and determine your needs.

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Miller Industrial Properties, Sparks, Reno, Nevada
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