10 Key Items to Evaluate Prior to Property Acquisition

In an industry that requires careful management of physical property operations, personnel, and finances, an asset plan provides the necessary direction for successful real estate management. The asset plan is designed following an in-depth analysis of the property and its position in the market. It may also be developed when a property is transitioned from one asset manager or asset management company to another, or on an annual basis, as a part of the ongoing management of an already-owned property.

The following are 10 key items a facility manager should review and evaluate prior to acquisition:

1. Curb Appeal

Start with the property’s curb appeal. Is the property presented in the most favorable manner possible? Will prospects looking for space find it attractive for their business operation? Is there deferred maintenance? If so, this may include everything from landscaping to roof repair.

2. Sustainability

Consider making efforts toward reducing the environmental impact of the asset. Such efforts may include alternative energy sources (solar panels), convenience to mass transit, water submetering, stormwater management, and commissioning. 

3. Interior Quality

What is the status of cleaning, carpet repair, wall coverings, ceilings, and lighting? The common areas of the property should be properly maintained.

4. Mechanical Records

Inspect the mechanical areas of the property to determine if equipment needs to be replaced. For example, if a chiller overhaul or compressor replacement is needed.

5. Foundation and Exterior

What is the condition of the building’s foundation and exterior? A qualified structural engineer should be hired to perform a detailed review of any of these conditions.

6. Disability Compliance

Is the building compliant with relevant disability regulations? Any deficiencies should be addressed.

7. Property Operations

When an asset management plan is being prepared for a property, there will be a thorough review of current management and leasing personnel. It is important to spend time evaluating the personnel who will be working at the property. This is a good time to assess education and training needs for a facilities staff.

8. Tenant Feedback

What do tenants have to say about the property? Performing tenant interviews is an important step that is often overlooked.

9. Building Plans

A complete set of building plans is important, especially if any alterations are anticipated. As-built drawings are plans drawn or modified after construction has been completed, and they are always preferable. 

10. Aerial Inspection

Aerial photos, taken over several years, can be extremely helpful in identifying attributes of your property, local development trends, adjacent property issues that might affect your property, and other maintenance issues.

This article is adapted from BOMI International’s Asset Management course. More information regarding this course is available by calling 1.800.235.2664. Visit BOMI International’s website, www.bomi.org.

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