Before investing into any commercial real estate or residential property, what do you look for? Well, if you don’t know how to qualify an investment proposition, worry not, we have got you covered. This walk-through details the classes of properties in Pakistan.
From durability to heterogeneity and immovability, the life of a building, especially in commercial settings, changes the dynamics of its marketability. In Pakistan, the demand and supply of infrastructure are affected by the classes of commercial properties.
In real estate, buildings are classified as classes A, B, and C. Each category reflects the potential of the property, in terms of quality, price, and amenities. For example, a class A commercial property in Pakistan is often located in a mid-size city or suburban area.
Also, these classes rule the sale and purchase of all properties.
Classifications of Buildings in Pakistan
To classify the building in Pakistan, let’s listen to real estate experts and developers!
The categorization of properties varies from project to project, and we typically use these factors to classify a building in Pakistan;
- Age of the building
- Location of the property
- Accessibility to public properties.
- The overall infrastructure
- Technological capabilities
- Capital gain and rental rates
- Local market perception
- The maintenance status/finishes
- Status – Tenancy/owned
- Available amenities – security and safety systems and others (read below
Class A Properties in Pakistan
Generally, type A properties are old constructions, like those built nearly 15 years ago. Such buildings possess the best amenities, facilities, and convenience. They are often located in prime neighborhoods and are backed up by top-notch security.
The structure of these properties is well organized. It exhibits a happening architectural style full of geo/eco-friendlier processes and mechanisms. They often follow a vertical development approach.
So, if you want maximum capital gains/rental income, invest in type-class-A properties in Pakistan. In urban cities (Islamabad, Lahore, Karachi, etc.), the real estate market has enough potential in this category of commercial investments. There is vast option for Commercial property in Pakistan.
Many real estate developers are creating A-class properties for commercial and residential propositions in the capital city. Our latest commercial project, Citadel 7, is located in Blue Area, Islamabad.
The demand and liquidity for type A property are high. You can quickly sell/purchase all such properties without fearing losing your capital. Compared to different types of properties like B and C, their demand is vulnerable to change.
These are some notable amenities that are identifiable in type A buildings/developments;
- Concierge services
- Valet services
- Security
- Lounges
- Separate parking facilities
- Dining options
- Daycare centers
- Gyms
- Private outdoor spaces
Class B Properties in Pakistan
In real estate, not only in Pakistan, type B properties are hard to manage but are well-maintained. Classically, their lifetime is close to type-A properties. However, the revenue-generation capacity remains moderate throughout their lifespan.
You will find a large pool of such properties in Pakistan. They are often located in good to average localities and are clean and super-spacious.
For commercial real estate developers like Chakor, we assign these properties “value-addition.” Because properties falling in the Class-B category can easily be remodeled/renewed, and you can easily shift in such spaces without significant fixes.
Class B buildings are often as high as five floors with small building infrastructure.
Yet these types of properties are considered risker according to investment purposes. As per CAP (Capitalization rate), these type of properties is used purposely by particular buyers.
Despite being riskier, it has gained more popularity in commercial real estate than a class-A property. As they are available at lesser investment plans/terms, in Pakistan’s residential real estate, single and double-story setups/villas are gaining popularity.
Bear repeating, type B buildings/properties are easy to move in, renew, upgrade, and add value additions to the existing infrastructure. You can earn more rental income if you upgrade your type B property.
Some amenities that you will find in type B-class properties are;
- Onsite parking
- Security
- Conference rooms
- Cafeteria-style or Cafe dining
- Shared outdoor space
Class C Properties in Pakistan
These properties are usually located across the least-known/demanded localities; they have existed for decades, meaning more renovations are needed as time passes. They often last more than 20 years.
Structured in an obsolete setting, the returns of class C commercial buildings are low and possibly negative capital. In Pakistan, real estate developers often buy type C properties and demolish them to re-purpose the land.
Not being sorted or in a presentable state/condition, type C property still is a winner for developers, ONLY if located in a good/upcoming locality. That’s why investors often have a keen eye for the sale/purchase of such properties.
These investors use the land for commercial and residential setups, like a gym, daycare, warehouses, media rooms, function rooms, coffee shops, parking, restaurants, and whatnot.
Type c-class properties often possess;
- Onsite parking
- Break rooms.
Wrapping-Up
These are primary property classifications, and there are sub-divisions too.
If you have enough resources, invest in type A-class commercial properties, especially the ones located in prime localities. We encourage you to support in type c-class, as they can be a good opportunity if properly re-purposed.
If you’re interested in investing in a type A-class property in the heart of Islamabad, Citadel 7, our upcoming project is one of the best in Blue Area Islamabad. The development comprises all the amenities that a world-class top-rated high-rise possesses.
