Services

Also referred to as a Cost to Cure Report. An Opinion of Cost report compiles cost estimates for immediate improvements and enhancements to the property based on the findings from a Property Condition Assessment. It helps determine the necessary funds to set aside to cover immediate expenses.

An Opinion of Cost Report is included in the property condition assessment and aims to provide the business owner or building owner with short-term budgetary estimations and determinations that will allow them to make an informed decision regarding purchase and construction. The opinion of cost is a 20% variance on current and actual labor, materials, and equipment prices gathered from local sources.

Clients suited for an Opinion of Cost Report are building and business owners who may be doing any repairs and replacements at the property and are looking for real-time cost estimates, which will aid in creating budgets concerning improvements and enhancements.

Forecasting and planning for expenses are the most important reasons a company needs to consider a Maintenance Strategy Program. This offers a commercial building owner a more preventative approach to building maintenance by having a building inspection followed by cost estimates and further ongoing strategy and consulting.

The objective of a Maintenance Strategy Program is to guide a building owner through the budgeting, planning, and execution of maintenance inspections, repairs and replacements, and prevention of unnecessary catastrophic repair expenses.

The development of a Maintenance Strategy Program is a three-step process including the following:

1. A Property Condition Assessment and Property Condition Report provides an overall baseline of the property’s condition.

2. A Cost to Cure Report or Reserve Study provides expense details outlining the immediate and or forecasted costs to repair and replace items.

3. Details from the Cost to Cure Report or Reserve Study help to design an individualized Maintenance Strategy Program. All items fall into one of three classifications of maintenance.

Neglecting maintenance items can have disastrous consequences, such as disrupting operations, harming productivity, and even contributing to customer and employee dissatisfaction. Prevent these consequences by implementing an appropriate maintenance strategy for your building and business type that fits your budget and time constraints. We highly recommend ongoing inspections to keep the Maintenance Strategy current.

(Note: A more comprehensive and long-term plan can include a Reserve Study, which forecasts the costs of improving building and property deficiencies for up to 30 years using useful life estimates and inflation as modifiers. Useful life estimates help organizations make decisions concerning whether to continue to maintain equipment or replace it.)

Also referred to as a Reserve Analysis, Reserve Table, or Capital Reserve Study. The Capital Reserve Forecast is an additional service to the Property Condition Assessment.

A Capital Reserve Forecast is a multiple-year plan that forecasts a property’s expected expenses in repairs, replacements, and enhancements by considering the current condition and remaining useful life based on the findings from a Property Condition Assessment. A five-, ten-, or fifteen-year analysis is most common, especially for small businesses.

A Reserve Forecast is the first step to determining long-term maintenance costs because it helps determine what short-term repairs will cost and helps forecast a budget to account for future known and expected repairs and replacement expenses by evaluating the life expectancy of the systems within a property. For example, we can determine the cost to replace a malfunctioning hot water tank today and report the amount it will cost to replace it in two or four years by using inflation as a modifier. These services aid long-term planning, infrastructure maintenance, and regulatory compliance. All calculations have a 20% variance on actual labor, materials, and equipment prices. 

Note: A Reserve Forecast is a great way to outsource a large portion of the cost of a facilities director, provide a roadmap for the facilities management team to implement, and avoid costly assessments throughout the years.

A Triple Net Lease Assessment is an inspection of a commercial building or property in which the tenant is responsible for the property’s expenses and must officially document deficiencies. Therefore, a thorough and officially documented assessment of the property’s condition is crucial to clearly establish the baseline of its state and identify any existing deficiencies at various stages of the lease.

The assessment aims to guide the landlord and the tenant within the scope of maintaining the property, reducing overall operating expenses by forecasting a budget, and protecting both parties from unnecessary and unforeseen risk and liability.

We strongly advise conducting a Triple Net Lease Assessment at any critical point throughout the leasing lifecycle:

• Before the Lease is Signed (Due Diligence): This pre-occupancy assessment is paramount for the prospective tenant. It serves as a vital due diligence measure, allowing the tenant to thoroughly understand the property’s current condition before committing to a lease where they will bear the burden of future repairs and maintenance. By documenting any existing deficiencies – from structural issues and system malfunctions to cosmetic damage – the tenant can negotiate necessary repairs with the landlord prior to signing, potentially avoiding unexpected costs and liabilities down the line. This assessment establishes a clear “as-is” condition, protecting the tenant from being held responsible for pre-existing problems.

• During the Lease Term (Periodic Review): While the tenant is responsible for ongoing maintenance, periodic assessments during the lease term can be beneficial for both parties. For the tenant, it provides a proactive way to monitor the property’s condition, identify potential issues early before they escalate into costly repairs, and ensure they are fulfilling their maintenance obligations appropriately. For the landlord, it offers a way to track the property’s upkeep and ensure the tenant is maintaining it according to the lease terms. Documenting the condition at specific intervals can also help resolve any disputes that may arise regarding responsibility for certain repairs.

• At the End of the Lease Term (Move-Out Condition): A final assessment conducted at the lease’s expiration is essential for determining the property’s condition upon the tenant’s departure. This move-out assessment compares the current state to the documented condition at the beginning of the lease (and any interim assessments). It serves as the basis for determining any damages beyond normal wear and tear that the tenant may be responsible for rectifying or compensating the landlord for. A detailed and impartial assessment at this stage helps ensure a fair and transparent reconciliation of any security deposits and avoids potential disagreements between the landlord and tenant.

Also referred to as Construction Phase Inspections. Draw Inspections are a series of scheduled commercial building inspections that measure the progress and risks of new construction commercial buildings or major construction projects to ensure successful and timely underwriting and closing.

The “phases” of the inspections mirror the lending schedule so the lender can disburse the next funds to the contractor. The Draw Inspector determines whether the contractor is on time with the construction schedule, is adhering to the construction plan, and is using materials as agreed upon in the lending contract. In other words, the draw inspector is the onsite eyes and ears of the lender so the contractor can receive payment for their services.

A Draw Inspection typically includes:   

• Site visit and verification  

• Photos and documentation of the interior and exterior and all purchased and stored materials

• Detailed review of the AIA and project budget

• Confirmation of invoices and onsite materials 

• Documentation of concerns

• Estimate of percent complete 

Clients suited for Draw Inspections are most often lenders; however, several groups of professionals make Draw Inspections successful. The inspector, lender, borrower, owner, contractor, and construction team work together to ensure the project and funds operate on a strict timeline.

Also referred to as an Insurance Claim Assessment or Insurance Investigation Inspection. An Insurance Loss Assessment evaluates and documents the damage(s) sustained on the commercial property or building reported to an insurance provider to file a claim. The inspection typically takes place within 48 hours of filing a claim. Some insurance providers require a 3rd party to perform the inspection.

An Insurance Loss Assessment aims to provide an insurance adjuster with unbiased, first-hand knowledge of the property, the damage and how it occurred, and a determination of the cause. Ultimately, the adjuster wants to know if the account of what is being claimed by the building owner matches the damage.

Any building owner or business owner filing an insurance claim regarding damage after a property damage, business interruption, theft, liability, or worker injury should consider having a third-party Insurance Loss Assessment to document the damage as quickly as possible.

Also referred to as a Pre-Insurance Policy Inspection. A Pre-Loss Assessment evaluates a commercial property or building and documents specific details about the building and its contents to determine if the policyholder has enough insurance coverage and document any pre-existing building conditions.

Pre-existing damage is rarely covered. The same goes for building materials that are aged or neglected because insurance companies consider those items as a maintenance issue, which makes the financial responsibility of repair or replacement the policy owner’s responsibility.

A significant benefit of a Pre-Loss Assessment is the confidence to purchase adequate commercial building insurance. This assessment delivers the correct and most up-to-date data points for the insurance company; it serves as a baseline to prove that future damage is not pre-existing to a specific incident.

Insurance providers require the following details before developing an insurance policy: data points about the building and its systems, additions, furniture and fixtures, machinery and equipment, all personal property within the building, and tenant improvements and betterments. It’s also a good idea to know the age of various systems and whether those systems are up to code before deciding on how much insurance coverage to purchase. Since the insurance company only has to replace what is destroyed, they are under no obligation to upgrade the electrical and plumbing; the requirement is to rebuild a building of similar or comparable size, quality, and construction, meaning building owners or business owners may be paying out of pocket for the difference of those upgrades.

A Pre-Loss Assessment also aims to unveil any liabilities the building owner may have with responsibility for maintenance and building standard requirements. For example, if a fire occurred in a multifamily complex and many fire extinguishers have expired or the fire suppression system is out of compliance, the insurance provider may not respond to the claim in favor of the building owner and may even find the building owner at fault.