Considering Capital Expenditure (CapEx)

Commercial property investors should always consider Capital Expenditure (CapEx) when getting a property inspection to avoid overestimating their property’s investment value. All costs associated with making modifications to a property that extend its useful life are referred to as CapEx. These expenses affect a property’s net cashflow, and if they are overlooked, a building’s estimated internal rate of return (IRR) and its true investment value may be incorrect.?

Companies use CapEx to invest in, buy, renovate, and maintain physical assets such as property, technology, or equipment. CapEx is not the same as a property’s day-to-day maintenance costs, which are still crucial cash-flow items for property investors to consider.

James Jones, founder of Home & Commercial Inspections LLC has extensive estimating knowledge and experience and can give investors a clear picture of the maintenance and CapEx that will be required for their property. With over 21 years’ experience in the construction industry, including his role as Senior Estimator/Project Manager in commercial construction, James is well-placed to give CapEx advice. He said investors should have a thorough grasp of the physical state of their assets so they can accurately plan their CapEx and finances.

“When investors are buying commercial properties, they need someone with an estimating background to give them an idea of what immediate expenses they can expect and what may be coming around the corner in the first five years,” James said.

Home & Commercial LLC perform a thorough Property Condition Assessment (PCA), which includes a walk-through survey, recorded analysis, and interviews conducted by a trained inspector to evaluate the property’s condition. The resultant Property Condition Report (PCR) details the physical condition of the property or building and helps owners recognize the service and repair criteria for future maintenance. James can also provide the necessary CapEx estimate based on the results of this inspection.

Assessments may vary from a simple visual review of the premises to a thorough analysis of all the building’s mechanical systems.?

“We examine elements such as the building’s age, occupancy, and construction type when determining how the property will be analyzed, the scope of the inspection necessary, the performance standards needed for a quality inspection, and the specific areas to be looked at,” James said.?

Qualified inspectors look at the characteristics of the property, including elevations and neighboring sites, and evaluate systems such as the building envelope, structural systems, roofing, electrical systems, fire safety systems, vertical transportation systems, accessibility, HVAC applications, energy systems, sewage and plumbing systems, and finished interiors. Inspections can involve experts, contractors, or a team solution, depending on the client’s property and needs, and inspectors may conduct interviews with key personnel.?

“We will also request information about the property, such as any outstanding zoning violations, maintenance contracts, fire safety plans, and data on former building code or

safety issues. We may also ask to review drawings, maintenance records, warranties, equipment lists, and previous reports and check if a base building certificate of occupancy was issued,” he said.

The subsequent PCA report, which is in accordance with ASTM E2018, contains a summary of every part inspected, a compilation of vulnerabilities that have been found, and the cost to modify and repair the defects.

“Our goal is to give the highest level of professional service and provide a thorough report so you can meet your due diligence requirements. If we discover an issue that requires additional assessment, we may propose follow-up inspections after the first PCA,” said James.

Home & Commercial Inspections LLC is the top PCA provider in Columbus, Ohio. Even reputable PCA providers vary in service level, speed of service, and the number of disciplines their company brings to the table. Home & Commercial Inspections LLC is proud of its rapid deployment, accurate costing, broad expertise, and extensive experience, providing reliable and straightforward property quality evaluations. Its multidisciplinary team has access to the most in-depth experience and up-to-date building cost results.

Each commercial inspector receives cutting-edge training before joining the Home & Commercial Inspections LLC team, and they have an excellent track record providing top-notch commercial building inspections throughout Columbus, Cincinnati, Cleveland, Toledo, and Athens, Ohio.?

The company also provides commercial construction progress evaluations to monitor and verify the efficiency, progress, consistency, and quality of the work being done. Pre-listing inspections use site characteristic and building condition assessments to help investors and agents estimate potential maintenance costs. Before the paperwork is signed, pre-lease and post-lease checks provide owners and tenants with an accurate view of a commercial property’s state.

But the Home & Commercial Inspections LLC service doesn’t stop there. The company also provides:?

• HVAC mold and indoor air quality inspections, locating mold, mildew, toxic chemicals, and general indoor air quality problems using cutting-edge technology
• Radon inspections, identifying the presence of radon and taking steps to ensure safety
• Termite inspections, detecting signs of insect damage, examining windows, doors, foundations, access points, joints and cracks, outdoor fencing, structure surfaces
• Asbestos sampling, inspecting for the presence of asbestos, taking air quality samples, and providing information to move forward with removal
• Lead inspections, including paint chip and XRF sampling methods and lab testing
• Thermal imaging, searching for hidden water and proper insulation, checking appliances are operating correctly, detecting potentially dangerous electrical circuits, and finding pest infestations