What is a property condition assessment?

May 8, 2018 // By:Scott Hamele // 2 comments

4 elements of a commercial building inspection report

By Scott Hamele, DBIA President and founder of Nationwide Commercial Inspections, LLC (NCI) and Construction DesignWorks, LLC

Even if you are a seasoned veteran of commercial real estate, understanding what should be included in a Property Condition Assessment (PCA) is often ambiguous. Don’t let the commercial property inspection cost or not understanding the basic elements sway you from ordering one. Understand it is the best money a buyer will spend.

A property condition assessment should include these elements

Nationwide property condition assessment

Pre-Inspection Research

The company providing the property condition assessment should provide adequate research prior to the actual walk-through site inspection. This research should be documented in the report and include such things as age of property, current zoning and usage of property, adjacent properties and usage, cross streets, utilities, and earthquake and flood zone information.

property condition assessment nationwide

Walk-Though Documentation

The inspector should include in the report a list of all items personally witnessed and viewed on site whether in good or bad condition. The items inspected should follow the ASTM E-2018 standard which defines a logical progression and includes all basic elements of a commercial building. The inspector should also ask a lot of questions of on-site employees such as owners, tenants and workers to better understand where problems may arise that are not visible to the naked eye; such as ongoing sewer backups.

PCA nationwide


Nothing tells a story like photographs. The inspection report should be accompanied with snapshots that help illustrate the deficiencies of the report. The more the merrier. However, don’t include three pictures when one would suffice. The vantage points a drone can offer is undeniable. When possible, ask for a drone inspection of the roof and upper areas of the exterior because this may offer a glimpse of a deficit that otherwise may go unnoticed.

property condition assessment chart

Building Repair Cost Estimates

Albeit, it is not the responsibility of the inspector to obtain competitive bids for repairs that are required as result of the property condition assessment, the report should include basic costs so the buyer has an idea of their potential investment. These cost estimates are vital during the due diligence period to determine if the real estate investment is doable.

By understating the basic elements of a PCA, you will better understand the advantages that it offers and will maximize your purchase agreement due diligence for the buyer as well pre-lease due diligence for a tenant.

Nationwide Commercial Inspections, LLC provides the most comprehensive commercial building inspection reports in the industry

NCI utilizes their architectural, engineering and construction expertise to create and develop a high-quality 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.

Click here for a video about the property condition assessments we provide.

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