Commercial Property Real Estate Inspections – Everything You Need To Know
- By seoserviceusa93@gmail.com
- •
- 31 Dec, 2018
Whether you’re a small business that is just starting out or a large corporation that has been ruling the industry for decades, choosing a location to run your operations is exciting. But before you sign an agreement for a commercial property, you should set up a formal inspection for the property to ensure that it’s the best place to run your business.
A property inspection brings forth any problems the commercial space may have and helps you determine whether it’s a worthy investment.
In Canada property inspectors are supposed to be licensed. There’s no central agency that overlooks property inspections in Canada but interested buyers are expected to consult a licensed property inspector before entering a commercial real estate contract.
A commercial property inspection should cover the following at the least:
- Accessibility: This includes emergency exits as well as wheelchair access
- Exterior: This consists of the parking lot, sprinklers and drainage
- Interior: This includes lighting, ceilings and windows
- Internal systems: This covers HVAC, electric circuits and plumbing
Inspecting the Structure of a Commercial Building
Foundation & Roof
The foundation and roof can be considered the most important part of the inspection because they’re a safety hazard.
The inspector should look for any cracks present in the foundation, signs of water damage and distorted walls. Major issues like these are red flags; they indicate possible problems you may face in the future.
Exits, Stairs and Parking Lot
Other structural problems include blocked emergency exits, crumbing stairs and a parking lot covered in potholes.
Electrical Wiring
Faulty electrical wiring also presents a major safety hazard. Property inspectors have to check for old wires that are fraying, electrical outlets that don’t work and broken or damaged cables.
Windows and Doors
Windows and doors have to be checked for possible drafts and leaks.
Selecting an Inspector
It’s best to work with an inspector who’s experienced. You can check out Canada’s Commercial and Home Inspector Association (CanNACHI). Take a look at the candidates and pick a candidate who has proven experience in inspecting commercial buildings. You can verify their license numbers and even ask for references if you want to stay on the safe side.
If major problems surface during the inspection, you should turn away from the transaction until they are addressed by the seller. A reputable inspector can keep you from making a bad decision that can cost you heavily.
Are you looking to buy commercial real estate in Toronto, contact Pivotal Commercial Realty.
Before you go ahead and sign any papers to purchase commercial real estate in Toronto, spend some time learning and understanding the market.
Investors in commercial real estate have to consider the following before they decide where they want to put their money:
Interest Rates
For the first time in 7 years, the Bank of Canada increased its interest rate in 2017. The interest rate set by Bank of Canada has a direct impact of the on the cost of taking out a variable rate mortgage as well as other loans.
Fluctuations in the Bank of Canada interest rates also influences the growth of corporations and consumer spending, which impacts the demand for both residential and commercial real estate.
Investors all over the globe think of Canada’s commercial real estate market as a safe haven. Even though there is some uncertainty about the rise of interest rates, the contrast between tight supply and growing demand for real estate in the country has been a driving force in the real estate market.
The commercial real estate market continues to be viewed positively by international real estate investors with Toronto and Vancouver being the most popular destinations. In 2018, Toronto was considered one of North America’s major real estate markets to invest in. In 2019, both Toronto and Vancouver are expected to be in the continent’s top 3 destinations.
The growth in commercial real estate is being pushed by the increased sales in office buildings. Even the political uncertainty between US and Canada did not hamper the success of commercial real estate in the country.
Major Markets
In 2018, Canada’s commercial real estate sector hit a record breaking $36.2 billion. This growth can be attributed to the increasing demand of industrial, office, retail, multi-family units and ICI land.
Those looking to invest in commercial real estate in Canada should consider Toronto, Vancouver, Calgary, Montreal and Ottawa. In 2017, most of the growth in the sector was driven by office buildings but in 2018, industrial real estate led the way.
In the near future, the demand for industrial real estate is expected to rise due to the increase of e-commerce business in the country that are looking to build fulfillment centers nearby for fast and easy delivery.
The commercial real estate market in Canada is continuing to flourish. However various factors are expected to make bring changes to the landscape in the future.
2018 proved to be a record-setting year for the commercial real estate sector in Canada due to an influx of new projects and high occupancy rates. With that being said, property owners are advised to monitor fluctuations in the market. Like all real estate, the commercial real estate sector of Canada is prone to disruption.
Let’s take a look at the key disrupters in commercial real estate in Canada:
Shared Workspaces
There has been a dramatic shift in the way people work in the country. Canada is experiencing a boom in the start-up community , many of which are led by Millennials.
Traditional office spaces are being replaced with co-working spaces that are designed to enhance collaboration, allow for greater flexibility and lower operational costs at the same time. Open offices are much cheaper than conventional cubicles. Younger professionals have found a way to work with limited office space.
Landlords can’t just lease out their building to select tenants, they have to redevelop their office space so it caters to the demand of the modern workforce. This can involve offering flexible suites or open concept office spaces.