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What is a Detailed Building Inspection and Why Dont I Want One?

Aug 22, 2008
A question that comes up from time to time and warrants comment is something like, But I thought you were going to find everything, or words to that effect said by a client and from time to time an agent while doing a commercial or industrial real estate inspection.

I have done over 6000 inspections. I am one of the best. I will not find everything. Nobody will. There are inspectors that will spend many hours listing out very minute details with the express reason of giving the client as much ammunition as possible to renegotiate the price of the inspection. I personally feel this is a disservice to all parties involved. Not everyone feels this way and thats ok.

There is an industry standard for a property inspection. It is very clear that the purpose is to find Material Defects. Significant issues in the major systems. It states that cosmetic issues are not part of the inspection. I feel strongly that this is the proper view to do inspections.

To try and find every defect in the property would be like trying to count how many hairs a person has on their body. It is just not realistic. Some standard needs to be set and agreed upon so that there is a level of expectation that can be met.

In the state of California there are some generally agreed upon standards. One is from the California Real Estate Inspection Association (CREIA). Another is the PCA Property Condition Assessment standard for Commercial Property Inspections by ASTM. The American Society of Testing and Materials. ASTM is considered the yardstick in the industry of commercial and industrial real estate inspections.

It has a very detailed description of what acceptable practice is for a commercial or industrial real estate inspection. It has many levels and degrees of involvement that can be done. It can encompass review of documents by qualified professionals such as an architect at the local Department of Building and Safety to having professionals examine every system and do detailed reports for these. It also lists out the minimum level Base Line for a site visit and review of a building and the associated parking structure. The base line inspection is generally the agreed upon inspection. It is done almost 100% of the time.

I bring all this up for a few reasons but the main one is to help clear the air and to try and help prospective buyers and real estate professionals understand what an inspection really is and is not. This will establish an agreement as to what it is we as professional inspectors do and do not do.

What we as a company do is look at the site while paying particular attention to the Plumbing, Electrical, Heating and AC, the Structure and Roofing. We look at the site and comment on immediate drainage issues. We look for material defects, safety issues and comment on the expected useful life of systems per industry standards. We do these things from a general visual stand point. We do not disassemble anything. We do not do any destructive testing. We test things on a representative basis. We do not check every plug or window or door or fixture. We look at things from a general visual standpoint. We spend from 1 to 6 hours depending on many variables on the site taking pictures and taking notes. You get a written report that can be well over 50 pages of information and pictures that show what we have found.

The amount of information in the report is extensive. It greatly increases the buyers knowledge of the building(s) and site. It will allow for a much more informed decision.

You will get a RISK Assessment tm. This will take the major systems as listed above and let you know:

1. What the expected useful life left in each system.

2. What immediate repairs or maintenance is needed or recommended for each system.

3. What expenses you should expect to pay over the next five years other than routine maintenance for each system.

After many years and thousands of inspections I have personally found that the above fits almost every buyers needs. It puts them in a much more informed position to make their decision as to the best way to proceed from there.

On rare occasions we have done detailed specialty inspections. These involve having professionals such as a Structural Engineer, Plumbing contractor, Electrician, Roofing contractor, Heating and AC specialist, Architects, Phase 1s, Termites examine the building and grounds and do detailed reports.

These usually take from 2 to 4 weeks to complete. The cost starts at approx $10,000 and can easily double that depending on size and complexity. This is very rarely needed or wanted. In fact I have done only 2 in all the inspections I have been involved in. I personally do not find them necessary nor do they warrant the expense in almost every circumstance.

The general visual inspection for the vast majority of commercial or industrial sites will give the usual buyer and agent sufficient information to determine if they need or want a specialist to take the examination further in a specific area such as roofing or the HVAC. Recommended further review is most often in the fields of the major systems as listed above.

My personal experience is that over 99.9% of the time the general visual inspection will increase the information and understanding of the building and site to the point that all parties feel comfortable with the best way to proceed.
About the Author
Bob Pace has been a Certified Inspector since 1994 and a licensed contractor for nearly 4o years. For more information about commercial real estate inspections visit his website at http://www.commercialrealestateinspectors.com to find out how he can help with your real estate inspection.
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