Class A, B and C
Informal grades for commercial buildings. Class A is newer, high-quality space with top rents; Class B is older but well kept; Class C is older and needs work, with lower rents and more risk.
Also called: class A, class B, class C, building class
Related terms
Property used for professional and administrative work, from small suites to high-rise towers. It is graded by class, leased by rentable square foot, and often uses full service gross leases.
Property used for business or to produce income, such as offices, retail, industrial buildings and larger apartment complexes. It is usually valued on its income and financed with commercial loans.
Net operating income divided by the property's price or value. It shows the yearly return before financing and is used to compare properties and estimate value.
Upkeep that has been put off, like old paint, worn roofs, or aging systems. It lowers value and adds to what a buyer will spend after moving in.
A building with two or more separate housing units. Properties with two to four units can use residential loans; five or more are usually financed as commercial.