In most things you’ve encountered, there always seems to be a hierarchy or ranking. From your groups and circles, to the things you buy, to the kinds of clients or customers you deal with at work, there always seems to be a ranking from first class or class A, to second class or class B, to third class or class C, and so on.
It’s very much the same with real estate properties and neighborhoods. There class A properties and class A neighborhoods, and there are class B properties and class B neighborhoods as well.
Best In Class
When thinking of class A properties, what comes to mind are the newest and best in class homes and commercial buildings. They usually belong to the most expensive and prestigious developments and properties in the prime locations of any given locality. Only buyers and investors who are looking for luxury and prestige can afford them.
In most instances, unless the property and housing market goes through a severe glut, or the financial and economic situation goes really bad, class A properties are usually given a very positive rating. Real estate and finance analysts readily give them a positive outlook for potential value appreciation. In fact, investors buy them for their value.
There are no hard and fast rules, however, on what’s a class A property and what isn’t. The class A homes and buildings in Missouri or Montana might only be class B or C in New York or Los Angeles. But, real estate professionals have come up with some indicators to evaluate the category of a certain asset. Here are some of those characteristics:
- Property location
- Year when the property was constructed
- Income level and earning capacity of residents and occupants
- Track record of appreciation of prices and valuations
- Condition and developments of the property
- Price and valuation of neighboring and adjacent developments
But, these indicators aren’t to be treated as a rigid matrix. They don’t have weighted effects or specifically measured impact on arriving at the general price of properties. They’re some sort of overall price factors.
Nicest Homes In Nicest Neighborhoods
Although the standard may differ from one state to another, or from one county to another, a good overall description of class A properties is that they would usually refer to the nicest houses and homes in any general vicinity. They’re also in the nicest neighborhoods.
You won’t be able to find state or federal guidelines on what class A or B properties are. There’s just some sort of general understanding or implicit consensus among real estate investors about what types of properties are referred to by these classes.
Class A properties refer to the nicest houses in the most prestigious and sought after addresses in town or in the city. Think of those luxurious palatial homes with several bedrooms, large spacious lawns, and even sprawling grounds in the suburbs, with long driveways and elegant cul-de-sac roundabouts. They usually have imposing columns and front doors, and important decorated windows. Inside these homes is pure luxury
Real estate investors, brokers, and agents agree that class A properties are typically built within the previous ten years and not more. Their owners and residents are very high-income earners. They typically have their own highly profitable businesses, are receiving large sums from trusts, or work in senior management roles in global or multinational corporations.
These properties are, sometimes, featured in real estate and property documentaries and publications. Real estate analysts often given them highly favorable ratings and predict steady rise in their value and market prices for many years to come. Furthermore, they typically have professional hires and stay-in household help to maintain their manicured lawns, lighted fountains, polished marble floors, well-appointed furniture, and elegant lighting and fixtures.
These class A homes are usually built in the nicest neighborhoods. The streets are normally quiet, with no one having to rush to offices and factories. Sidewalks are lined by expensive cars, which have no more parking space in garages filled with them. Occasionally, a chauffeured luxury sedan or sports utility vehicle (SUV) drives by to bring wealthy passengers to their important meetings and events.
Low Crimes And Secure Neighborhoods
Another characteristic of class A properties is that they give you an assurance that your family is safe and can sleep soundly at night, without the threat of burglars and vagabonds littering the streets.
They’re usually gated neighborhoods, with round-the-clock security stopping unfamiliar cars, patrolling the neighborhood, and checking on any suspicious character who could be intruding into the quiet daily lives and lovely evenings of their affluent and important residents.
Prestigious Business Addresses
Class A properties can also refer to offices and commercial buildings. Without having to read up a lot about class A offices and commercial buildings, it’s not too hard to figure out what it takes to be considered part of the ‘best in class’ commercial buildings.
When they speak of class A offices and commercial buildings, they’re most likely referring to the newest, most modern, architecturally elegant, and technologically advanced high rises located in internationally recognized business districts. They offer some of the most sought after business addresses in any given locality. They have the highest property valuations per square footage.
Real estate investors and analysts expect them to have high-quality standard finishes, state-of-the-art systems and amenities, and strategic accessibility that puts them right in the center of the business hub. The typical tenants of class or grade A offices and commercial buildings are global brands, old investment houses, leading law offices, and tech giants.
Class A offices and commercial buildings would typically have these features:
- Spacious and elegant grand lobbies, with shiny marble floors and high ceilings, as well as hanging chandeliers and lights
- State-of-the-art HVAC system and central air condition
- Professional building staff at the lobby to welcome guests and clients
- Structured cabling of high-speed Internet and surround Wi-Fi
- Redundancy in power generation back-up facilities and power saving equipment
- Multi-level parking spaces for the convenience of tenants and clients
Buying Into Class
There are no rigid rules on how to categorize which properties are class A. What real estate practitioners have come up with is a set of characteristics and guidelines. But, it’s not that hard to tell. Class A properties, buildings, and neighborhoods exude value and luxury, wealth and importance, power and prestige. The proverbial saying is not always true because, in real estate, money can buy you class.