Office Building Appraisals – Vanguard Office Valuation Services
We have performed office valuations on conventional office buildings, medical office buildings, dental office buildings, creative office buildings, live work buildings, GSA buildings, business parks, corporate headquarters, downtown CBD office towers, high-rise office buildings, office condominiums, suburban office buildings and more. We know the complexities of appraising office properties. There are many factors that a commercial real estate appraiser must deal with when taking on an office appraisal assignment. The following is a sampling of some of the major questions and factors we consider when appraising an office property.
What is the building type and class? Office or Medical Office?
What is the Highest & Best Use of the property?
How does the location of the subject property compare to other nearby office properties?
Floor Area Ratio (FAR) and site coverage? (subject property vs. other office properties)
What is the parking ratio? Is parking adequate?
If the subject property is leased? Is the contract rent below market or above market?
Is the property a single-tenant or multi-tenant property?
Condition of the building? (subject property vs. other office properties)
Is the property leased? Vacant? Owner-Occupied?
What is the load factor?
Is there excess/surplus land?
What are the neighborhood demographics?
Are there any easements/encroachments?
Is the property in a flood plain?
Is there deferred maintenance? If so, how much will it cost to cure?
Appeal? (subject property vs. other office properties)
What do the local brokers say about the current office market conditions?
What are cap rates for office properties in the market?
How many stories is the building? High-rise? Mid-rise? Low-rise? Single-Story?
Is the building elevator served?
What is the appeal of the common areas? Lobby? Hallway?
Is there a view amenity? Ocean View? City View?
Is the building freestanding? Part of Business Park? Condominium development?
Interior condition? Floor coverings?
Fire safety? Sprinklers?
What is the most probable buyer of the subject property? Owner-User? Partial Owner-User? Investor?
What concessions or tenant improvements allowances are typical in the market?
What is the common lease structure for the market? (NNN, Full Service Gross, Gross + Utilities)
What is the historical occupancy of the subject?
What is the scope of the assignment?
Year built and effective age? (subject property vs. other office properties)
What is the remaining economic life of the property?
Construction quality? (Steel, Concrete Tilt-up, Masonry, Brick, Wood-Frame)
What are the marketing and exposure times for office properties?
Building and Site Size? (subject property vs. other office properties
What is the zoning? Allowed uses? Parking requirements?
Do the current improvements conform to zoning?
Topography? Shape of the site?
What is the sales and ownership history of the subject property?
What are the property taxes? Is it over assessed? Mello-Roos?
Restrooms? Plumbing adequate?
What are the supply of demand characteristics of the office market and submarket
What are asking rents, vacancy, net absorption of the submarket and market?
Are they any proposed or projects under construction that will compete with the subject?
What are the operating expenses of the subject property? How does it compare with other office properties?
What are the most recent sale transactions of comparable properties in the neighborhood?
Amenities of the building? Gym? Locker room? Showers? Security?
As you can see, appraising office properties can be extremely difficult. It is extremely important that you use a qualified and competent commercial appraiser for all office appraisal assignments. Please contact Vanguard Realty Advisors for all office appraisal assignments.
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