Save Your Commercial Buyers Money
Aug 21, 2017 // By:Scott Hamele // No Comment
Inspections offer commercial buyers negotiation power
As a real estate broker, you can guide your commercial buyers in the direction that will best protect them and their investment. So why wouldn’t you advise them to order a commercial building inspection, also-known as a Property Condition Assessment (PCA).
A PCA offers instant negotiation power in a purchase contract by giving the buyer the ammunition to lower the price. The PCA should be ordered immediately after the purchase contract is signed and prior to the expiration of the due diligence period. Typically, the results of a PCA end up in 3 areas:
Critical Corrective Action
Items such as roof leaks, evidence of mold and asbestos, serious structural defects and life-threatening issues will all require remediation prior to the closing or a reduction in price to immediately rectify after the closing.
Code Compliance Issues
These are areas of the building or space that may not be critical to the buildings condition, but may not meet current building and fire codes. Building codes often change and the building may need costly modifications to restrooms, installation of ADA ramps, additional egress points, etc. These are all items that will cost the buyer in the immediate future and should be considered in a negotiation.
Deferred maintenance and cosmetics
Often an owner lets the maintenance of a building get behind and as a result, there are non-critical items that develop. Items that may require repair include joint sealants, roof flashing, masonry sealers, door hardware, exterior drainage issues, parking lot cracks and potholes, broken seals on exterior windows, inoperable hot water heaters, inefficient HVAC systems, etc. These are items that may not be considered an imminent threat, but will cost the buyer down the road, and should be considered as a negotiation point prior to closing.
A PCA is a value-added service all real estate brokers should offer their commercial buyers. Be considered one of the top in your industry. This value-added benefit only solidifies yourself as a trend leader.
NCI utilizes their architectural, engineering and construction expertise to create and develop high quality Property Condition Assessments (PCA). These reports are customized for each type of real estate: office, retail, flex-space, industrial, hospitality and healthcare. If you are interested in protecting your real estate investment, contact us at 913-667-7774 or visit our website at www.nwc-i.com.