Property Condition Report
What is included in a Property Condition Report (PCR)? The short answer is that the Property Condition Report evaluates all improvements. Most Property Condition Reports done for lenders are done within the scope and limitation of the ASTM Standard E2018.
My firm, Partner Engineering and Science, typically defines the scope as follows:
- Conduct a thorough walk-thru inspection of the asset by an experienced building inspector or engineer;
- Interview tenants, building maintenance staff, and building management;
- Visit the city building department to look for violations, records of improvements, and the certificate of occupancy;
- Review of building plans, quotations for work, and warranties provided by the seller;
- Develop a schedule of Immediate Repairs necessary due to failed systems, systems being past their useful life, and/or building code violations;
- Develop a Replacement Reserve Schedule for the next 12 years (or the requested reserve period), where Partner will estimate the remaining useful life of major systems and provide an estimate of the replacement cost at that time in the future;
- Prepare a detailed report discussing each building system and its condition.
Partner’s PCR will evaluate the following systems and conditions:
- Site Improvements
- Site Access and Traffic Flow
- Storm Water Drainage
- Paving Type/Age
- Curbing/Wheel Stops
- Pavement Striping
- Landscaping and Appurtenances
- Retaining Walls
- Site Lighting
- Waste Storage Area
- Site and Building Signage
- Other Site Amenities/Recreational Facilities
- Structural Foundation and Frame
- Structural Design Criteria
- Structural Frame
- Parking Garage/Carport
- Facades/Exterior Wall Systems
- Exterior Walls
- Roof Type
- Active Leaks
- Roof Drainage
- Thermal Insulation
- Expansion Joints
- Ancillary roof(s)
- Mechanical, Electrical & Plumbing
- HVAC Systems
- Electrical Systems
- Plumbing Systems
- Vertical Transportation/Conveyor Systems
- Fire/Life Safety
- Fire Sprinklers
- Life Safety/Alarm Systems
- Interior Elements
- Viewed Spaces
- Floor Coverings
- Ceiling/Walls/Window Coverings
- Common Areas
All of these elements are inspected during a walk-through inspection. The inspector will not be turning systems on and off; rather, the inspector will visually inspect the systems and ask questions of building personnel. Some clients want us to do more, and for those clients, Partner will hire sub-specialist to accompany our inspector.
POTENTIAL EXTRA SPECIALTY SERVICES:
In addition to our walk-thru assessment, Partner can provide specialty inspections. Specialty inspections are done by our significant roster of sub-contract specialist. The Specialty Inspectors investigate beyond the requirements of ASTM E2018. For example, Partner’s general inspector will inspect the elevator and the elevator controls, but an elevator specialist is qualified to open and inspect the elevator pit. The following specialty inspections are often added to Equity Property Condition Reports:
Energy Audit Model the entire building’s energy consumption, rate building against peer buildings; enter into Portfolio Manager; and make recommendations for energy efficiency improvements.
Energy Benchmark/Disclosure Enter the building’s utility data and relevant building parameters into EPA’s Portfolio Manager and get a rating for the building.
Structural Inspection A registered engineer / structural engineer will inspect the sites superstructure foundations for signs of deflection, structural sagging, cracking, and vulnerability to future loading (seismic if applicable).
Elevator Inspection Inspect elevator cab, elevator equipment room, the elevator shaft and hydraulic lifts.
HVAC Inspection Inspect all heating and cooling equipment as well as ducting and heat conveyance systems. Test the heating and cooling output regardless of the season (i.e. test the air condition in the winter).
ADA Compliance Inspection Inspect the entire asset for compliance with the Americans Disability Act (ADA) and catalogue each system that does not meet ADA Compliance. Provide a cost estimate for bringing the asset into compliance with ADA.
Roof Inspection A Roof Inspector will inspect the roof of each of the buildings. The roof inspector will map all signs of roof aging and failure including: cracking, silting, ponding, bowing, leaking, and patches.
Building Envelope Inspection Inspect the entire building envelope and curtain wall for its ability to serve as an effective moisture barrier. Complex curtain wall systems should be evaluated by a specialist.