Why smart, thorough inspections are vital in real estate
There is no doubt that a property inspection, as nerve-racking as it may be, is an important and necessary part of the purchasing process. The last thing anyone wants when purchasing a commercial property – or any property, for that matter – surprise, or what I like to call “landmines.”
Sadly, buyers cannot count on sellers to disclose all there is to know about a property. But having a qualified third-party inspector take a hard look at a building not only uncovers these landmines but can also save investors and owners money in the long run. There are three key areas where landmines are usually found:
1. Physical structure
It goes without saying that a proper inspection will include the physical structure itself. This means taking a closer look at everything from the roof to windows to wiring to heating and air conditioning units to drainage and ADA and code compliance.
There’s also the matter of what cannot be seen with the naked eye – and subsurface plumbing is a prime example. All too often, broken water and waste lines are not discovered until after purchase, when the new owners receive water bills higher than budgeted. Issues missed with an improper inspection can result in expensive headaches and repairs – in this case, breaking up cement flooring.
2. Zoning
Unfortunately for investors, zoning is an area that’s not only overlooked, it’s also not even on the radar. The bottom line is that it’s imperative to ensure that zoning and codes allow the intended use of the property before purchase.
3. Environmental
Again, this is an inspection of what isn’t so apparent. I often like to make sure my clients have, at the very least, a Phase 1 audit, in which an environmental audit company does a thorough look at the books and records of the property’s previous use. This will help uncover any environmental issues that may still be lingering in the soil surrounding and beneath the structure.
If warranted, this can lead to a Phase 2 audit, in which the environmental audit agency takes soil samples to check for any contaminants. Although this is more suitable for industrial properties, there have been cases of office properties located near gas stations that have experienced a leak, thereby impacting the surrounding properties.
The Morris Southeast Group response
Throughout the CRE process, you must learn all you can about a property of interest. While it’s impossible to protect oneself from everything, a thorough inspection can bring you that much closer to that everything ideal.
Working with the professionals at Morris Southeast Group can connect you to your perfect property, and help you learn all there is to know about that property so there aren’t any landmines getting in your way.
For a free consultation or to learn more about our property investment opportunities and/or other services, call Morris Southeast Group at 954.474.1776. You can also reach Ken Morris directly at 954.240.4400 or via email at kenmorris@morrissegroup.com.
Tags: Beware of Hidden CRE Issues, Find Hidden Issues, Property Inspections
