What is the difference between gross area and net area?

Gross area describes the whole building or floor under a stated measurement convention. Net area describes the portion counted for a particular use after specified exclusions. A hallway may be part of the gross building area without being part of a tenant’s private usable space. Neither label, on its own, tells you exactly where the measurer drew the line.

Put three figures on the same floor plan

Suppose an office floor measures 20,000 gross square feet, including its core and common areas. One suite has 5,000 usable square feet. If its lease allocates another 750 square feet of shared space, the tenant pays for 5,750 rentable square feet. At $30 per rentable square foot per year, base rent is $172,500, not $150,000. That 15% add-on is an assumption in this example, not a universal conversion.

Which figure should go in a comparison?

For a construction budget, gross area may be the useful denominator. For furniture planning, use the space actually occupied. For rent, use the area specified in the lease. Ask for the measurement standard, edition, date and inclusions before comparing two quoted prices per square foot. BOMA publishes different measurement standards by building type; do not assume an office method applies to apartments. The same denominator issue affects comparisons of triple net lease costs.