A common area is, in real estate or real property law, the "area which is available for use by more than one person..." The common areas are those that are available for common use by all tenants, (or) groups of tenants and their invitees. In Texas and other parts of the United States, it is "An area inside a housing development that is owned by all residents or by an overall management structure which charges each tenant for maintenance and upkeep."
Contents
- Examples
- Case law
- Residence halls
- Business Spaces
- Real estate taxation of common areas
- Loss factor
- References
Common areas often exist in apartments, gated communities, condominiums, cooperatives and shopping malls.
In any situation where there is a tenancy in common, all the tenants in common collectively own the common areas, meaning that any one individual owner does not possess more control over the land than any other owner.
This differs from a commons or common land, as used in English law, which is owned by one person, but which may be used by a group of persons.
Examples
Examples of common areas include:
- lobbies,
- corridors,
- stairways,
- parking lots, spots, ramps, or other such areas,
- washing machines or laundry room,
- the roof of an apartment building,
- elevators,
- washrooms in lobby area,
- driveways, and
- store rooms.
Case law
In Maryland v. Garrison, the US Supreme Court found that police may enter a common area when executing a search warrant. Also, in Illinois v. Rodriguez the US Supreme Court held that "a warrantless entry is valid when based upon the consent of a third party whom the police, at the time of the entry, reasonably believe to possess common authority over the premises, but who in fact does not do so." Furthermore, the court held:
a person who permits others to have "joint access or control for most purposes ... assume[s] the risk that [such persons] might permit the common area to be searched." 415 U.S., at 171 , n. 7; see also Frazier v. Cupp, 394 U.S. 731, 740 (1969) (holding that defendant who left a duffel bag at another's house and allowed joint use of the bag "assumed the risk that [the person] would allow someone else to look inside"). As the Court's assumption-of-risk analysis makes clear, third-party consent limits a person's ability to challenge the reasonableness of the search only because that person voluntarily has relinquished some of his expectation of privacy by sharing access or control over his property with another person.
Residence halls
In residence halls of colleges and universities, the common areas are those spaces in a dorm that are for the use of all the student residents. In order to paint murals, improve with fixtures, or otherwise change the common area, permission may have to be obtained from the director of residential life.
Business Spaces
Common area also applies to organizations such as shopping malls and strip malls, in which multiple businesses operate.
Real estate taxation of common areas
States vary in how they tax common areas, for real estate tax purposes. It may depend on whether it is a condo or a co-op. For example, the state of Arizona taxes "residential common areas" in housing developments with a flat tax, but common areas of condominiums and golf courses are assessed separately.
Loss factor
In commercial real estate in the USA, a building's loss factor is the percentage of the building's area shared by tenants or space that are dedicated to the common areas of a building used to calculate the difference between the net (usable) and gross (billable) areas.
That portion of the space is considered "lost" because it cannot be directly leased and the maintenance and operation costs must be covered by the other rentable areas.
The loss factor is often confused with load factor, but the formulas for each term vary.
The loss factor is calculated as follows:
Loss Factor = (Rentable Area – Usable Area) / Rentable Area
The Building Owners and Managers Association has established a standard with American National Standards Institute, ANSI/BOMA Z65.1-2010 for measuring floor area and calculating gross leasable area and loss factor.