WASHINGTON, DC -- (Marketwired) -- 06/21/13 -- The Building Owners and Managers Association (BOMA) International, in collaboration with research firm Kingsley Associates, released the 2013 Experience Exchange Report® (EER®) this week. The report showed a 9.0 percent decrease in utility costs for private-sector office buildings, and a 3.9 percent decrease in total operating expenses in 2012 compared to 2011, underscoring an industry focus on maximizing building efficiency in the face of dwindling income streams.
Both rental income and overall income decreased in 2012 by 2.9 percent and 3.23 percent, respectively. Building owners and managers are compensating for these income losses by reducing energy use and weekly HVAC-serviced building hours: total electricity expenses in the private sector decreased 12 percent in 2012 compared to 2011, and the average weekly building hours decreased five percent, from 70 to 66 hours.
Private sector buildings saw a 23 percent decline in in-house parking costs, and the parking ratio declined 12 percent, from 1.61 stalls per 1,000 square feet to 1.42 stalls per 1,000 square feet. Shuttle costs increased a significant 89 percent, data that suggests that building owners are providing more perks to potential tenants, such as shuttle services to public transportation and satellite lots, to remain competitive in the market.
"Today's commercial real estate market is healthier than it was four years ago, but the recovery is slow," stated BOMA International Chair Joe Markling, managing director of Strategic Accounts with CBRE. "Property professionals know that strong asset management is more important than ever, and the continued and significant decreases in utilities and other expenses underscore the fact that well-run buildings can thrive in any market condition."
Private-Sector Office Building Income Trends
•Private buildings in the U.S. saw a 2.5 percent decrease in base rent, from $22.03 per square foot (psf) in 2011 to $21.48 psf in 2012. •Pass-throughs decreased from $4.29 psf in 2011 to $4.09 psf in 2012. •Income from lease cancellations increased 4.6 percent, from $0.65 psf in 2011 to $0.68 psf in 2012.
Private Sector Office Building Expense Trends
•Total electricity consumption decreased by 12.4 percent, from $1.94 psf in 2011 to $1.70 psf in 2012. •Cleaning expenses decreased 4.9 percent, from $1.49 psf in 2011 to $1.43 psf in 2012. •Repairs and maintenance expenses held steady at $1.94 psf from 2011 to 2012. •Security expenses, including payroll, taxes, and benefits for security staff, dropped 14.5 percent, from $0.55 psf in 2011 to $0.47 psf in 2012. •Roads and Grounds-related expenses decreased 14 percent, from $.21 psf in 2011 to $.18 psf in 2012. •Administrative expenses decreased 1.0 percent, from $1.46 psf in 2011 to $1.45 psf in 2012. •Fixed expenses decreased 1.0 percent, from $4.10 psf in 2011 to $4.07 psf in 2012.
The Experience Exchange Report is commercial real estate's premier income and expense data benchmarking tool. It provides valuable insights into the performance of more than 5,300 buildings, in 250 distinct markets, across 115 cities in the United States and Canada. The EER allows users to conduct multi-year analysis of single markets, and analysis of special use facilities such as medical office buildings, financial buildings, agency managed, corporate facilities and all-electric buildings.
Now in its 93rd year, the EER continues to be the most detailed and reputable source of benchmarking data representing the office building industry across North America. The EER's online format allows users to query data by market, submarket, building size, building type and more. The data can be exported into PDF and Excel formats, allowing users to expedite analysis, build budgets faster and easily create presentations. The 2013 EER encompasses income and expenses from 2012 -- reported voluntarily from industry practitioners -- and is available now at www.bomaeer.com.
About BOMA International
The Building Owners and Managers Association (BOMA) International is a federation of 93 BOMA U.S. associations, BOMA Canada and its 11 regional associations and 13 BOMA international affiliates. Founded in 1907, BOMA represents the owners and managers of all commercial property types, including nearly 10 billion square feet of U.S. office space that supports 3.7 million jobs and contributes $205 billion to the U.S. GDP. Its mission is to advance the interests of the entire commercial real estate industry through advocacy, education, research, standards and information. Find BOMA online at www.boma.org.
Documents and/or Photos available for this release:
2012 Private-Sector Expense Ratios
2012 U.S. Private-Sector Office Building Expenses -- Fixed, Cleaning, Utilities, Total Operating, TOE+Fixed (in dollars per square foot)
To view supporting documents and/or photos, go to www.enr-corp.com/pressroom and enter Release ID: 356219
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Courtney C. McKay
Manager of Communications & Marketing
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