As published in RICS Journal on 18 August

The recently published IPMS: All Buildings clarifies area definitions and introduces guidance to ensure consistent reporting and conversion, as our third article on the standard elaborates.

All stakeholders rely on consistent building information to ensure they are making informed decisions. Therefore, the International Property Measurement Standards (IPMS) can and should be used for all property measurement purposes, not just valuation.

IPMS: All Buildings has been drafted to let users choose the standard relevant to the purpose for which the area is being measured. IPMS 1 and 2 are intended for the measurement of the whole or part of a building, while the standard also provides technical guidance to ensure consistent area reporting.

Guidance defines and clarifies measurement process

This guidance is a new element in the IPMS and includes key definitions applicable when interpreting and applying the standard. Many of these terms have been specifically defined for IPMS: All Buildings to ensure they are understood and used consistently. There are also several diagrams that build on these definitions, demonstrating key measurement principles used throughout the document.

All the diagrams in the standard are designed for a generic building rather than one specific to a certain asset class, and illustrate the measurement principles, concepts and definitions.

Given various consultations since the first IPMS: Office Buildings standard, the Standards Setting Committee also identified that All Buildings needed to be clearer on the extents of each measurement. A four-stage process was therefore introduced for each measurement, providing clear criteria to follow.

Stage 1 provides guidance on determining the boundary extents of the measurement required and will vary depending on which of the IPMS measurements has been chosen. Stage 2 meanwhile includes special considerations for specific measurement rules; for example, with balconies, voids or party walls, it explains exactly the measurement extents, as they may differ between standards used, e.g. IPMS 1 or IPMS 2.

Stage 3 is to calculate these areas once the IPMS boundary for each level – that is, storey – has been determined. Any reporting must state whether the measurement is for an entire building or for one or more of its levels. Stage 4 is then used to identify areas that have been included in the measurement but need to be reported separately; these areas can be used to convert IPMS measurements to those of existing standards, such as the RICS Code of Measuring Practice.

IPMS 1 and 2 refine external and internal area definitions

IPMS 1 and 2 have not significantly changed since the first IPMS: Office Buildings and are intended to provide a measurement of part or a whole building. However, you could separate the overall IPMS 1 or 2 into different uses or asset classes in a building, ensuring that the aggregate for the different areas equals the building total. This is particularly helpful for determining the service charges, designing buildings to ensure the best use of space, or construction costs of the various elements of large, mixed-use buildings.

The measurement of IPMS 1 relates to the external extents of the external walls, measuring to any notional boundaries and including external or sheltered floor areas. Doing so allows a user to compare the area of the building with all the associated build costs.

IPMS 1 closely matches the existing measurement rules for gross external area (GEA) in the current RICS Code of Measuring Practice. The main difference is the inclusion of external floor areas such as balconies, colonnades and rooftop terraces, as well as sheltered areas such as those formed by canopies on industrial units.

Each of these areas can easily be identified and stated separately, and therefore subtracted from the IPMS 1 to obtain the GEA. The new standard also refines and clarifies the extent of areas such as balconies, voids and mezzanines to ensure consistency in the way these spaces are measured.

Although similar to gross internal area (GIA), IPMS 2 differs in ways that can have a larger impact, depending on the building type. The main difference is that IPMS 2 is measured to the internal extents of the internal dominant face (IDF) rather than to the internal face of the perimeter walls.

Measuring to the IDF has caused some consternation among RICS members because it deviates greatly from current measurement guidance, but users need to remember that IPMS: All Buildings is designed to provide consistency around the world. IDF, in some form, is used already by a large proportion of property professionals worldwide.

However, with the increased focus on understanding and reducing building energy usage around the world, will IPMS 2 provide a better metric for consistent building areas? At present there are a number of differing area reporting requirements depending on which environment rating system is used, with each one slightly nuanced from the next or even lacking clarity in what building areas should be used and how they are calculated.

IPMS 2 seems to fit the bill, especially given that it includes the space occupied up to the IDF, e.g. windowsills. This area still uses energy for heating, cooling and lighting, so the area it occupies should be included in calculations.

We’ll be eagerly awaiting industry feedback on whether IPMS 2 provides a better metric for measuring floor area and how it can ensure that energy usage and reduction is measured consistently around the world.

RICS is also preparing a new edition of Property measurement that will incorporate the concepts and principles of IPMS: All Buildings, allowing for consistent measurement and comparable data across the sector.