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March 15, 2017

First classification of business centres in Chelyabinsk

GVA Sawyer and Yellowstone Development elaborated the ranking of operating business centres of Chelyabinsk. The research results show that the total area of business centres amount to 120 000 sq.m. and there are no Class A offices in the city.

The categories are similar to those adopted in banking (AA, BC etc.). The key characteristics for the breakdown into classes were determined using normalization methods under preselected criteria. According to Yellowstone Development, the research and ranking only included the objects that were originally intended to be used as office spaces. Thus, administrative buildings, former scientific institutes, student housing and so on were not studied.

The objects were evaluated under the following parameters: location, quality and operation. These key parameters were subdivided into several subpoints: red line location, public image of the neighborhood, accomplishment of the surrounding area, transport accessibility, novelty of the concept etc. Each parameter was considered in accordance with evaluation criteria and received the mark from 0 to 1.

The researchers adopted a four-class classification system, which allows classifying an object in numerical terms and unambiguously after its audit (separate evaluation of each parameter).

“The classification of business centres, elaborated by GVA Sawyer and based on Yellowstone Development research, is the logical continuation of the classification of Moscow Research Forum (MRF) and the Russian Guild of Managers and Developers of the Russian Federation (RGUD). The most important innovation in the classification is the opportunity to define the position of a business centre in the ranking unambiguously and in numerical terms. The class of the object is also strictly and expressly defined”, Marianna Romanowska, Partner and Head of Consulting of GVA Sawyer, explained.

Comparative chart on business centre categories:

ParameterClass АClass ВА Class BВ Class BС
Location≥ 90% ≥ 80% ≥ 70% ≥ 60%
Project≥ 90% ≥ 80% ≥ 70% ≥ 60%
Operation≥ 90% ≥ 80% ≥ 70% ≥ 60%

As a result of the research, the operating business centres of Chelyabinsk were classified as follows:

  • Class BA (corresponds to Class A of the classification compiled by MRF under “Location” and B+ under “Project and Operation”) includes one business centre: “Arkaim-Plaza”.
  • Class BB (corresponds to Class B+ of the MRF Classification) includes 5 business centres: Grand Hotel “VIDGOF”, Business Hall “Bovid”, Business House “Bovid”, “Chelyabinsk City” and “GREENPLEX”.
  • Class BC (corresponds to Class B of the MRF Classification) includes 3 objects: “Newton”, Business Centre on Komsomolsky prospect 90, “Vipr”.
  • Class C (corresponds to Class C of the MRF Classification) includes 13 operating business centres.

“Before the ranking was compiled, the market used the information on the class of the business centre, provided by its developer and management company. Quite often the owners do not categorize their objects at all, which indirectly implies poor development of the office real estate market and absence of non-price competition”, commented Ksenia Tenkova, Head of Commercial Real Estate of Yellowstone Development.