Office Condo Appraisal in Carlsbad

office-condo-appraisal-carlsbadIntegra San Diego has completed a commercial appraisal of an office condominium property located in Carlsbad in San Diego County. The property consists of two existing, contigous units totaling about 2,550 square feet of rentable area. The improvements were constructed in 2006 and were 100% occupied by a single tenant as of the effective appraisal date. The purpose of this commercial valuation was for loan underwriting purposes for a lender.

When valuing a commercial condominium, it is important to know the difference between the property’s rentable area and usable area. In short, the usable area is the area located inside the unit. The rentable area typically includes a pro-rata share of the building’s common area such as hallways and common area restrooms. In the subject property’s case, the common area also included a conference room on the building’s third floor. The difference between the usable and rentable area of a building is known as the load factor.

In addition to knowing the difference between these two areas, it is also important to note the impact on value, as a property with a higher load factor (greater difference between rentalbe and usable area) may sell for less than a property with a lower load factor. To determine this, an appraiser reviews sales of similar properties with different factors as well as interviews market participants (buyers, real estate brokers, etc.) to see if this affects a buyer’s purchasing decision.

If you have any questions about commercial condominium valuations, please contact us today at 858-259-4900 or sandiego@irr.com.

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