The Australian Property Institute (API) is one of more than 50 global property professional organisations that collaborated to create a new international property standard set to bring transparency and consistency to global markets.
The International Property Measurement Standard for Offices (IPMS for office buildings) will create dozens of existing measurement standards currently used worldwide.
In 2013 commercial property market transactions were estimated to be more than $1 trillion worldwide, according to Real Capital Analytics, with investors and corporate occupiers increasingly operating across international borders. Despite this, many of the standards used within the industry are local market specific, making consistency and comparability a significant challenge.
Phil Western, the API nominee of the IPMS coalition, said the new standard set for office buildings would lead to increased market transparency and consistency.
“This will benefit the way property assets are managed and, ultimately, how financial decisions are made by investors, corporate occupiers, buyers and sellers,” Mr Western said.
“Historically, property has been measured differently throughout the world. According to research by global property firm JLL, depending on the standard used the area quoted in different markets for an equivalent building could vary by as much as 24%. These inconsistencies have led to confusion in markets.
“Investors, including pension funds, have often had to factor in variation in quoted property size when making decisions about acquiring new property,” he said.
The industry response has been overwhelmingly supportive. Governments too are expected to support the adoption of IPMS to promote transparency and international best practice.
You can access the new standard on the IPMS website.