The Cost of Clutter In Commercial Real Estate Appraisals

Orlando commercial real estate appraisers know their role is to accurately estimate the value of the buildings they are hired to appraise. They look at the building, the market surrounding it, and similar buildings. While an appraisal weighs a number of different factors, keeping your building in good condition and clutter free can help you to achieve a higher appraised value.

More than ever, commercial real estate appraisals need to be extremely complete. Appraisers now measure spaces that may have simply been estimated in the past. They typically ask to see an entire building including all of its suites, storage areas, mechanical systems, nooks and crannies. Areas that are inaccessible due to clutter could very well be excluded from the building’s square footage since they can’t be inspected and valued.

All appraisals involve a certain degree of judgment. Your commercial real estate appraisal will be based on a dispassionate analysis of the real estate and the market, but it’s also be influenced by what the appraiser sees. Appraisers not only look at the building, but also at the nature of the tenants and how they relate to the building. These factors can influence how they adjust the cap rate they apply, and how much likelihood they grant to each remaining tenant. A building that is poorly maintained or cluttered is likely to be worth less in the appraiser’s eyes than one in Class A condition.

The other factor to keep in mind is that your appraiser will need to back up his or her opinion of value with detailed photographs of the building. If the photographs of the building are unattractive, it will be much harder to justify a high value if they’re called on to explain how they appraised the building. Clutter is one of the things that can make a building photograph poorly.

Orlando commercial real estate appraisers understand why their clients need appraisals and why hitting as high a value as possible is important. However, if the building doesn’t look valuable, the appraiser’s hands are tied. Just as it’s a good idea to repair any structural issues before having your commercial property appraised, tidying up is equally wise.

For more information on commercial real estate appraisal or to have a property appraised, please contact Commercial Investment Appraisers at 407-369-8080 or info@commercial-appraisers.com.