Here it is November and it’s that time of year again. It’s year-end acquisition time. is hopping with available multifamily and commercial properties. Vacant, foreclosed, and under performing real estate investments are screaming for new owners. Some sellers are sprucing up properties while others are busy camouflaging flaws. Property Condition Assessments are needed to detect detrimental conditions. Buyer beware and lender be leery. We all know how important proper due diligence is in discerning investment risk. It is the key that unlocks powerful potential in real property.

Investment Risk

For prospective purchasers, a Property Condition Report is priceless, often revealing hidden issues like undetected water intrusion and interior damage—both serious problems that go hand-in-hand—especially in states like Florida where average rainfall is higher. For debt and equity side due diligence, as investors, we need to know if a structure has a sprinkler system and working fire safety equipment or if the HVAC equipment on the rooftop has tie-downs that meet building code.

Construction Flaws and Mechanical Systems

Tornado alley and hurricane highway are real threats to Miami skyscrapers, New Orleans boutique hotels, and Atlanta multifamily complexes. Current conditions of mechanical systems are a mystery until a qualified inspector checks them out. Conducting a Property Condition Assessment now is more important than meeting with your general contractor to plan the renovations. Find out if the buildings are worth the risk first. Is there a construction flaw? Who is on your acquisition team?

Due Diligence

A seasoned commercial building inspector should be on the acquisition team. Who knows best where to peek between all those nooks and crannies when a 42 million dollar deal is on the table? It is the due diligence expert. The inspector with the skills and decades of experience walking through high rises and multifamily complexes.

This expert should have a long list of satisfied clients who trust he or she with a myriad of portfolio assets. Like a good quarterback, as investors—we all need a team of professionals to make it to the Super Bowl. Trusted pros in asset management know the key to hiring inspection teams with expertise in due diligence. They know who will expose the flaws and shed light on the flaws that often go undetected in commercial structures. These trusted inspectors walk on roof tops and sometimes they even walk on water. Their word is trusted. They speak. Trump listens.

Technology & Response Times – Free Quotes

With the age of the Internet and my reliance upon quicker information gathering, I assumed that requesting a free quote via a company website would result in a more rapid response than picking up the phone. It seems to depend on the business and its priorities.

Leaning toward small business, I contacted a boutique commercial building consultant company and clicked on the button “free quote” on the website. To my astonishment, someone communicated the same day that I sent the email through the website. Wow, this told me that they care about my business and they aren’t too busy with current clients to consider taking on new business. Responsiveness is good, I thought.

I assumed a national firm with offices scattered across the U.S. would also have a rapid response time too, right? Nope. One company I requested a quote from on their website did not seem to “need” my business. Perhaps a response in less than 3-4 business days might have persuaded me otherwise.

Inclined to move forward with the boutique company because they responded immediately, I chose not to bother asking questions of the larger “national” firm because they had too many “add ons” in their quote. Beware of companies that give you overly complicated proposals and quotes, including a lot of legal language that means that their inspectors can call you when they are in the midst of the inspection and ask for a lot more money than they originally quoted. That’s scary stuff, in my opinion. When I request a quote, I want one I can count on, not some legal mumbo jumbo that muddies the waters. Delete, delete, delete. My time is valuable.

National versus Boutique Company

There needs to be a comfort level when hiring a valued member of an acquisition team. Why not stick with the small business and the personal touch?  The boutique firm, Commercial Building Consultants, has a rapid response team, sort of like a hospital for buildings….they seem to take the “free quote” communications seriously and don’t waste time getting in touch. Amazing, in the Age of the Internet, people are really behind that button, “free quote.” This is efficient and I found it refreshing to hear back from a website so quickly. New Contacts: CBC, Greg Trotter, President. Scott Pruitt, VP. Commercial building inspectors in Orlando, Florida. Save, save, save.

Quote Queries

Reviewing a proposal for a PCA can trigger dozens of questions. Is it a baseline proposal or does the company go above and beyond the baseline? How soon can the PCA be conducted? Does the fee vary depending upon the location or how soon we need the report? Will the inspection team walk the rooftop? What percentage of the total number of units in a multifamily tower will the team walk through? Does the company hire contractors or is the work conducted with in-house employees? Can they guarantee a follow up conference call with the inspector who walked the rooftop of the building—if we have questions after reviewing the report? How soon can we expect the Property Condition Report after the PCA is performed? Is the report all inclusive or must additional fees be paid for ADA and safety assessments? Call the company. Ask. Don’t assume anything.

Debt and Equity Side Risk Assessment

Whether it is a PCA for mortgage financing purposes or to determine immediate repair and maintenance costs, a baseline Property Condition Assessment provides a detailed report identifying physical deficiencies and cost estimations for financial and strategic consideration. Photographs depicting the mechanical systems, vertical transportation, interior and exterior, window and roofing systems, parking lots, and storm water drainage should document the current structure and site conditions. Remaining useful life (RUL) and estimated useful life (EUL) conditions and estimations for deferred maintenance and repairs should also be outlined in the final report.

Beware of Outdated Reports

Don’t be tempted to use an old report! Water intrusion happens constantly in tropical and coastal areas. Mold grows quickly. A current walk through inspection is vital for risk assessment.

The Cost of a PCA Varies Widely

The cost of one of these building inspections varies widely. The Internet touts that building inspections or Property Condition Assessments can cost “$20,000 to $100,000” or more. Of course, information on the Internet is always questionable. We all know this. Some inspection firms charge exorbitant fees while meeting the ASTM requirements for a baseline Property Condition Assessment, but why? What’s the difference in their inspection for $30,000 and the quote received for $3,000?  When considering one quote, I also had to ask: “Do we want a seasoned inspector who goes above and beyond the requirements or an inspector that does the bare minimum?” Now, let’s explore the wide range of fees charged for a baseline PCA following the general guidelines from the American Society’s Testing and Materials (ASTM) website.

Pennies versus Dollars per Square Foot?

When speaking with the commercial building inspector at Commercial Building Consultants, inquiring as to how much a Property Condition Assessment can cost, I was pleasantly surprised to learn that one of these building inspections can be performed for pennies per square foot. That’s right, I wrote pennies, not dollars. As I’ve researched this topic, this is unusual and perhaps some savvy investors might go with the higher quote thinking they are getting more bang for the buck, especially with a “national” firm with dozens of offices. Think again.

Check, because this may not be the case. The higher quote may not include everything included in a baseline property condition assessment. Ask for a sample report to see what the inspector’s typical baseline building inspection covers. Several factors go into quoting these inspections and each firm differs. Having spoken with a couple of representatives from national firms last week, I chose not to hire them due to the extra fees they charge for doing the same work that a smaller firm will include in the quote for the PCA. More work for less money. Enough said.

Building Inspector Interview Reveals How Small Businesses Care

Greg Trotter of Commercial Building Consultants (CBC) revealed that the cost of a building and site inspection depends on several factors. First, the complexity of the site assessment is key. Next, the size, age, and height of the building are also factors in the equation. Last, the location of the property makes a difference. Is it local or does the building inspector need to travel? If it requires travel, how long will it take to accomplish the work? These are all considerations when quoting a property condition assessment, according to Trotter, who has walked thousands of rooftops during the course of his career.

“We love what we do,” said Greg Trotter, President of Commercial Building Consultants. “We treat everyone the same way.”

Although the interview focused on the cost of a PCA, it was apparent that the company is motivated more by helping others succeed and committed to keeping costs under control. In fact, Scott Pruitt, Vice President of Operations, knocked on Greg Trotter’s office door during our interview and I witnessed first hand, the careful consideration of a PCA proposal, including this executive team’s desire to keep the cost down for the client. This spoke volumes to me. When I contacted CBC via their website, I received a reply within 2 hours.

“That’s the norm for us. We do our best to get a response out to the customer within hours of the request for a free quote,” said Trotter. Scott Pruitt handles proposals personally and between the two, it’s obvious they care about the relationships they’ve built with clients. For me, it helped to understand the operations of a boutique firm versus the corporate environment, where I spent many years working in large firms with 20+ partners. With Trotter and Pruitt, their discussion did not center as much around the bottom line as it focused on how soon they could serve the client and how well they could meet the need for the particular inspection assignment as well as future business. It’s all about the relationships at CBC. The quote they were discussing was much less than $4,000 for a high rise in downtown Orlando. I was astonished. I’d received a quote from a national firm for $2,600 for a commercial building with 1/10 of the square footage of the quote CBC was discussing. This is how they treat their valued clients. It was a long term client that they had been inspecting portfolio assets for more than a decade. This spoke volumes to me, as an investor.

The passion for the work is what motivates the president of CBC, who often has to be up at 3 a.m. to catch his flight from Orlando International Airport to travel the eastern seaboard coastline to the next commercial building inspection site. As his cell phone buzzed on his desk near the close of our interview, Greg Trotter looked down at the text message and smiled.

“I don’t have to be to the airport until 6:30 a.m. tomorrow to fly to Alabama.” He went on to describe how this long-standing client has a few properties in the portfolio that are not centered around airports. Hence, he will drive two hours or more from Atlanta to inspect their buildings, but it is all in a day’s work for CBC.

For more details on PCAs and other commercial real estate services, please visit the company’s website:

In my next post, I’ll be offering insights and photographs coming straight from the field inspectors. Safe travels and happy holidays.


Vicki Nelson


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