Buying a commercial property is a huge investment plan with high-profit potential. Before putting your money into it, it’d be great to ascertain that the building is in good condition. That’s where property inspection comes in. Failure to take this step may lead you to buying a substandard structure, which might shoo away tenants once they get wind of the underlying issues. Thus, it’s essential to have an inspection checklist.
Here are key things that guide you on how to inspect commercial property:
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Assess Major Building Systems
Commercial buildings consist of five major building systems. These are:
- Electrical
- Mechanical
- Heating
- Plumbing
- Air conditioning and ventilation
These systems can incur enormous expenses if they’re not well-checked. They can also become health hazards for your employees if they’re not in proper working condition. Your inspector should carefully assess the systems and advise you on the right repairs, which can be costly. For instance, replacing the property’s electrical system can set you back thousands of dollars. Your inspector can help you estimate repair costs, which you can use to negotiate better prices from the seller.
You can get some tips from a guide at Novellus Bridging or other similar resources if you intend to venture into a commercial property investment. It’s also important to note that it differs from buying a residential property. So, you must know about the right financial strategy and familiarize yourself with the dos and don’ts of commercial property purchase.
- Review Building Documentation
Your inspector should review several documents before you purchase the property. Verifying the construction documents and the building’s maintenance reports ensures everything is in order. Key documents that you should thoroughly scrutinize include:
- Appraisals
- Building plans and blueprints
- Citations
- Construction permits
- Maintenance records
- Emergency evacuation plans
- Certifications
Once your inspector goes through all the documents, they should prepare a property condition report (PCR). It’s a map that points out potential issues for the buyer. It’d be best if the report features findings and photographs as proof of evidence.
Get into details like design loads and whether the structure can withstand the dead and live loads. If it’s in an area prone to natural disasters, like flooding and earthquakes, you’d want to ensure the building incorporates appropriate mitigation measures.
Evaluate The Exterior
Another factor you should consider is the building’s exterior. Inspecting this area ensures you buy a visually attractive building, including its walls, cladding, roofing, landscaping, and parking lot. A building’s beauty is a critical consideration among potential tenants. No one wants to do business in a dilapidated building, given they need to impress customers.
Besides aesthetics, it helps to check the functionality of the exterior building components. For instance, the roof and gutter system must properly direct rainwater from the building to safeguard its foundation. You can hire an expert to inspect the roof. The last thing you’d want to happen is to have a non-functional roofing system. You may also want to consult building code inspectors to ascertain the structure is in line with local standards. Their expertise can also help you uncover underlying issues, preventing future disasters.
Check The Interior
An interior inspection aims to ensure the building meets local building codes. Building regulations differ from state to state, and it helps to ascertain your property-to-be satisfies all regulatory demands. Otherwise, you may not get the certificate of occupation.
The key areas to consider in an interior inspection include floors, walls, ceilings, and kitchen spaces. If there are issues with any of these components, it’s essential to renovate them as soon as possible. If the renovation costs are significant, you can negotiate with the seller to deduct the expenses from the sale price.
Check For Environmental Hazards And Pests
An inspection helps you spot environmental hazards. Some of dangers to look for when buying a property include the following:
- Gasoline storage tanks can contaminate your property and can quickly start a fire.
- Oil tanks can contaminate groundwater and soil around the building.
- Look for leaking underground tanks.
- Look for landfills as they can also be a source of contamination.
- Inspect for pests in the building.
Before buying a commercial property, you must ensure you’re not exposed to environmental hazards. For one, if you’re running a restaurant, you’d want to keep off places exposed to oil or gasoline pollution. On the one hand, a fire can easily burn your investment.
Pests are a major concern when buying commercial property. For instance, if you have wooden structures, you’d want to avoid areas infected by termites. Thus, it’s essential to have a pest inspection conducted before you buy the property.
Inspect The Location
Commercial property is primarily for business. Thus, the location should be safe and accessible. Again, if it’s in a busy area, you’ll need to look for a parking spot for your clients. On the same note, you’d want to check around for other amenities and businesses, for instance, access to transportation networks.
Additionally, it’d be best to consider the security of your customers and clients. Thus, consider the crime rate before buying commercial property. Otherwise, your venture might not fetch you some income if it’s in a high-risk location.
Conduct Structural Integrity Tests
With commercial properties, it’s best to watch out for structural problems, such as cracks in the walls, uneven flooring, and bowed walls. You can call a structural engineer to conduct some tests to evaluate the building’s integrity.
Ensure the load-bearing components have adequate capacity to support the building’s weight plus the live loads. The walls should be thick enough compared to the height of the building. The structure should also have adequate reinforcement to guard against vibrations from heavy traffic or nearby plants and factories. You can also test the pressure on the structure from additional floors in a story building. Such tests help you handle significant structural issues before they become catastrophic.
Conclusion
Carrying out an inspection before buying any commercial property is vital. Through this, you get an idea of the extent of the property’s damage and the needed repairs. This way, you can prepare yourself financially; alternatively, if the issues are extreme, you can consider another building.
