| When making a decision to purchase a commercial | | | | that may be remedied with routine maintenance, |
| investment property, a thorough condition | | | | miscellaneous minor repairs and normal operating |
| assessment is essential. Unless you are thoroughly | | | | maintenance. It also excludes conditions that generally |
| trained and educated in this part of real estate, I | | | | do not present a material physical deficiency to the |
| strongly recommend hiring a professional to perform | | | | subject property. |
| this task. In addition, I suggest you take the time and | | | | Don't just read the report as it is part of your "Due |
| walk through the property inspection with the firm | | | | Diligence". Get involved, and understand the process |
| that you hire and ask questions. | | | | and what makes up a physical deficiency, which ones |
| A baseline property condition assessment process is | | | | are more important and which ones could be a deal |
| very detailed and thorough. It is customary practice, | | | | killer. You will get 10 times the amount of information |
| at least in the US, to conduct research and perform | | | | out of a simple Property Condition Assessment by |
| a walk-through survey evaluating the improvements | | | | walking through the property with the consultant and |
| located on a parcel of commercial real estate. The | | | | communicating by asking well thought questions, then |
| goal is to identify the physical deficiencies or material | | | | by just reviewing the end result which is the report. |
| deferred maintenance of a property, its components | | | | I have conducted a number of independent Property |
| and/or equipment. In addition to a walk-through | | | | Condition Assessments myself but typically we |
| inspection of a commercial investment property, | | | | contract the services of a reputable firm to perform |
| document review and interviews are conducted as | | | | this task. However, I make sure I am present on |
| well. The interviews augment the walk-through | | | | each and every walk-through so I can understand |
| survey to assist the consultant in understanding the | | | | the property as well. I can also enhance the reports |
| property and identification of any physical deficiencies. | | | | by performing a separate independent report that |
| The work product resulting from completing the | | | | covers issues that a typical Condition Assessment |
| Property Condition Report incorporates the | | | | would not. I can get a lot better feeling of whether |
| information obtained during the walk-through survey | | | | the building was taken care of just by looking at |
| and includes opinions of probably costs for suggested | | | | engineering logs, water treatment tests, equipment |
| remedies of the physical deficiencies identified. The | | | | logs, etc. |
| Property Condition Assessment excludes deficiencies | | | | |