If speed is an important factor for your next commercial property transaction, then you need a property appraiser that works fast. But even the most efficient appraisal firms can’t do their jobs if clients don’t provide the information they need. Lack of communication can significantly slow down the commercial real estate appraisal process. You as the investor or borrower need to do your part to speed things up.
What happens during an appraisal?
The appraisal company will conduct a physical inspection of the commercial property in question. This involves a walk-through of the site, observing interior and exterior elements of the building, and taking pictures that will go into the report. The appraiser will need you to answer questions on matters such as the operations of the business, development plans and timelines, specifics about the property itself, etc.
After the physical inspection, the property appraiser then conducts research about zoning, the neighbourhood, city, and regional data affecting the property. The goal of the research is to help the commercial real estate appraisal company in Toronto understand the environmental, governmental, and social economic conditions that affect the property’s value. Appraisal firms also analyze comparable real estate.
The final step in the commercial real estate appraisal process is writing the report and valuation conclusion.
What can you do to speed up the process?
Lack of communication from the stakeholder is one of the biggest factors that can delay a property appraiser’s work. Another problem is in accuracy; some borrowers provide outdated financials and other information that is no longer valid or true. A property appraiser in Toronto needs the most recent data in order to create an accurate report.
With this in mind, there are two things you can do to prevent delays:
- Be ready to provide all relevant and updated documents as requested by the appraisal firm. It’s a good idea to ask the company ahead of time what they need. You typically have to prepare the following documents (if available):
- Building drawings
- Site plans
- Income statement and operating expenses
- Rent rolls
- Tax information in the recent years
- Results of environmental assessments, if any
- If the appraisal company asks you a question; respond as fast as you can.