A property condition assessment can protect against deal-killers.

Article submitted by Edward Rotenberg, Partner/Associate Broker for Saurage Rotenberg Commercial Real Estate

Written by Joe Derhake, PE  [August 2011 – Commercial Investment]

Many investors ignore the return on investment that property condition assessments often can deliver. PCAs yield an ROI in three ways: protecting buyers from bad purchases; providing buyers with information for price negotiations with sellers; and finding opportunities to improve building value post-purchase.

Not all PCAs are the same. The property condition scope outlined in ASTM E2018 is a very flexible standard. The ASTM PCA is a walk-through assessment where a knowledgeable architect, engineer, or building inspector walks through the asset, interviews available personnel, reviews available records, and evaluates the condition of all building systems. For large assets and clients with lower risk tolerance, an engineering assessment firm can upgrade the inspection by bringing in a specialist such as an elevator inspector or an engineer who is trained in mechanical, electrical, structural, or plumbing systems. While this increases the investigation’s cost and depth, property owners who regularly order equity PCAs should experience greater ROI.

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 Edward Rotenberg is a graduate of Baton Rouge’s Episcopal High School and Southern Methodist University in Dallas, Texas. An industrial member of the Society of Industrial & Office REALTORS® he is also a past member of the Board of Directors of the Commercial Investment Division of the Greater Baton Rouge Association of REALTORS®. He is also a member of the  Louisiana Commercial Data Base (LACDB); the National Association of  REALTORS® (NAR); and the Greater Baton Rouge Association of REALTORS® Commercial Investment Division (CID).

Saurage Rotenberg Commercial Real Estate is a member of the Baton Rouge Area Chamber of Commerce (BRAC); the West Baton Rouge Chamber of Commerce; the Baton Rouge Growth Coalition; the Baton Rouge Better Business Bureau; the Louisiana Commercial Data Base (LACDB); and the International Council of Shopping Centers (ICSC). Several agents, on an individual basis, are members of the Society of Industrial and Office Realtors® (SIOR), the Certified Commercial Investment Member Institute (CCIM); the National Association of REALTORS® (NAR); and the Greater Baton Rouge Association of REALTORS® Commercial Investment Division (CID).