COMMERCIAL REAL ESTATE LEASE AND SALES COMPS FOR APPRAISAL

Typically, an appraiser will select a minimum of three recently closed sales that closely resemble the subject property in terms of location and relevant characteristics. Then, they make adjustments as needed to develop a credible opinion of value. This appraisal method is called the sales comparison approach. Commercial leasing refers to the leasing of commercial property that authorizes the use of the property for businesses, offices, retail spaces, and other commercial reasons. Here, commercial appraisal helps in setting the value for the asset, the same way commercial appraisal in Los Angeles gives the fair value of the property.

CHARACTERISTICS OF SALES COMPARISON APPROACH

Location and neighbourhood: 

Geography may directly impact the value of real estate. It's important to compare homes in the same neighbourhood rather than those found in another part of town. Factors considered include proximity to schools, nearby bodies of water, parks, highways, and overpasses, as well as pollution levels.

Recently sold listings:

These properties can provide a starting point for the value of homes in the area. Although features and the market factor into the sale price, reviewing property values and recent sales are good baseline numbers.

Features: 

A home should be compared with properties with the same number of bedrooms, garages, and bathrooms. The comparison should include homes of about the same square footage on parcels of land that are about the same size.

Age and condition:

It's important to compare homes of similar age as well as soundness. A home's condition significantly influences an appraisal. For example, there may be two similar homes in the same neighbourhood. But if one needs repair, it can seriously affect its value.

Average price per square foot:

Once similar homes are compiled, take each of their sale prices and divide them by their square footage. The result yields the cost per square foot based on the homes in the sales comparison analysis. Take the average cost per square foot for all comparable homes and multiply that number by the square footage of the home being appraised.

Commercial Real Estate Lease in Los Angeles

To find a commercial real estate lease in Los Angeles, you can explore various options based on your specific requirements:

Identify Your Needs: First, you need to determine the kind of property you are looking for to lease like office space, retail space or industrial property. But it is important to consider factors like size, location, budget, etc.

Search Online Platforms: Search for online platforms that have expertise in commercial real estate listings such as LoopNet, CoStar, or local real estate agency websites in Los Angeles.

Contact Real Estate Agents: First things first, find brokers or commercial real estate agents who specialize in the Los Angeles market. These agents would help you get your desired properties on lease and give a tour of that as well.

Visit Properties: After shortlisting potential properties, it is advised to inspect the place and assess whether it meets your needs or not.

Negotiate Lease Terms: Negotiating lease terms can be made with the owner or landlord, which includes rent, duration of lease, maintenance responsibilities, or any other clause related to business.

Review Lease Agreement: Terms and conditions of the contract need to be reviewed to ensure they meet your expectations and seek legal advice if necessary, before signing the contract.

Sign Lease Contract: After both parties have agreed, the contract is signed to secure the commercial property for business operations.

Commercial Real Estate Rent and Sales Comps play a crucial role in the appraisal process by providing essential data points for assessing property values, rental incomes, market trends, and investment potential. For example, Commercial Appraisal in Los Angeles helps in finding the value for property in the urban area of Los Angeles for potential buyers.