Commercial Listing data is available from the Multiple Listing Service of NE Florida ( Northeast Fl. Association of Realtors). Also lease information is available at Lease rates for commercial and industrial properties or LoopNet.com Prices for commercial appraisals generally vary from $500 to 2,500; commercial appraisals are bid or quoted on an individual property basis. Call me for a price quote and a potential appraisal service engagement letter. Market AnalysisThe requirements for appraisers to complete more in depth market analysis for residential, commercial and industrial properties has come to the forefront in light of the recent economic recession and clearly a much higher level of foreclosures, short sales and REO sales in the residential market and increasing vacancies and lower lease rate levels for commercial and industrial properties. If you have questions relating to the topic of market conditions or broader market analysis send a email or make a posting on the appraisal blog. ne & Atlantic Beach Market Investment Analysis One of my favorite tools for very quick and basic investment analysis is the HP12-C. It comes with some stacked registers and buttons that will allow for a quick analysis to arrive at Net Present Value or IRR (internal rate of return) for an investment property. It is an interesting review of a commercial or industrial property's potential from the investor's point of view. Over lunch or a short meeting with the proper estimates of an investment property's income, expenses and resale potential a knowledgeable user of this calculator can provide some valid conclusions. Let's have lunch or a meeting, you might decide this is a good tool for the investor. This is really the prelude to a formal commercial appraisal which can utilize a capitalized estimate of income or a discounted estimate of cash flows to arrive at an opinion of value by the income approach to value. Multiple unit Apartments, Office buildings, Industrial warehouse spaces and retail centers could all be analyzed quickly utilizing this straightforward calculator. Of course as with any calculator or computer the data has to be good. A realistic estimate of income or cash flows for an investment property is of paramount importance along with other considerations. If the commercial or industrial property is an income producing property a capitalized annual income estimate for a year or a discounted cash flow over several years may be applicable depending on nature of the cash flow. If the net income is considered stable a straight forward income capitalization might be appropriate. If income or occupancy is not considered to be stable then a more involved and detailed discounted cash flow analysis might be considered more appropriate to reflect the transition from partial occupancy to full occupancy at market rates over a typical holding period.
Some of the eclectic blending of architectural styles for office buildings in Downtown Jacksonville, Fl. (2011 Office Vacancies DT are in excess of 22%, possibly putting pressure on leasing rates)
Investor yield rates, generally the property yield rate (Yo) should focus on the prospective rates that are anticipated by the investors and anticipated expenses that can be estimated based on the following information:
With several of these types of market derived expected yield rates for similar property types the appraiser can estimate a typical investor yield rate for a subject property. This property yield rate can then be used to discount estimated cash flows of the subject property (initial cost, periodic net incomes and resale price) into an estimated present value. AN APPRAISER ALWAYS NEEDS TO KEEP IN TOUCH WITH WHAT THE BUYERS OR INVESTORS ARE EXPECTING IN THE WAY OF RETURNS ON THEIR INVESTMENT OVER TIME. A LOCAL BUSINESS OR INVESTOR MEETING MIGHT BE A GOOD PLACE TO UNDERSTAND THESE EXPECTATIONS OR A" ONE ON ONE FACE TO FACE" DISCUSSION IS PROBABLY BEST. CALL ME I AM OPEN FOR EITHER AND THE INFORMATION SHARED CAN BE ENTIRE CONFIDENTIAL, AS YOU WISH.
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