Commercial Inspection
Property Condition Assessment is an evaluation of the building, its systems, and site components conditions; the assessment outlines the development of efficient, reliable, and affordable methods for current and future repairs.
Types of properties that required the Property Condition Assessment include industrial buildings and facilities, commercial buildings such as retail plazas office buildings and hotel, and apartment buildings.
Property Condition Assessment is typically required for due diligence purposes prior to acquiring a real estate property or for
financing/refinancing purposes. The assessment is often requirement of lenders in order to assure the building is in adequate condition, within acceptable maintenance costs during the duration of the mortgage. It is also a tool for investors to negotiate the price of the property with the seller; reducing the price of the property, or demanding repairs before the building transaction is complete.
What does a Property Condition Assessment include?
The Property Condition Assessment report includes an evaluation of the physical condition of the building, the site components, and the buildings systems in order to estimate long-term maintenance costs and needs. A long-term maintenance program addresses the specific needs and condition of the building, and helps maintaining it in the proper condition, while reducing maintenance costs. Subject to the limitations of the scope of work, the Property Condition Assessment lists major deficiencies in the building and its systems, assesses the remaining service life of major components of the building. Items that are typically included in a Property Condition Assessment include structural elements, roofs, exterior walls, finish, heating systems, electrical systems, and various others.
Many property owners also conduct the Property Condition Assessment on a periodic basis; usually every three to five years. The frequency of the evaluation depends on the use of the building, its structural concept, location, size, and age. It can also be conducted if there are issues that require immediate attention, such as cracks or water penetration that might affect the long-term maintenance program of the building.
Subject to the limitations of the assessment, the scope of the assessment typically includes the following items:
- Structural system
- Roofs
- Exterior walls
- Hallways and stairwells
- Sample units (in multi-unit buildings)
- Underground parking garage (when applicable)
- Plumbing systems
- Electrical systems
- Mechanical systems
- Site components
- Infrared thermal imaging (optional)
The Report is divided into a few sections, which includes:
- Description of the scope of work and limitations
- Description of the property
- Description of the major elements of the property, finding and deficiencies, and recommendations
- Photograph documentation
- Probable cost to remedy physical deficiencies for short and medium terms (typically up to 10 years)