Department of Transformation

No orange barrels or earth moving trucks but movement all the same. You are in charge of getting a positive result using the usual resources such as sales disclosures, with focus on your goal of equitable values for commercial property.

The tools you have always had:

  • maybe an ancient 12C calculator

  • software for assessment management (outdated or the latest purpose-built)

  • a sincere support staff... big or small

  • an active and competitive local real estate market

The above is all you ever needed, and your improved focus comes from fully developing the last listed tool. Local sales from your market have always been carefully collected and analyzed, yet have not been sufficient alone to properly stratify values by type, tenancy design, size, condition, and location. Sales are only part of the market.

Analysis of your local rental market significantly expands your database, as nearly all commercial, industrial, and multifamily properties have a determinable market rent. Achievable rent can be estimated at stabilized vacancy and expense levels, and together with capitalization informed by sales translate directly into very enlightening locally relevant data. 

Then, use the sales to establish stratification points and fill in the gaps with estimated values from the rental properties you have diligently researched. You will see how much more sense the model makes when enhanced with rental data. You have started to transform your accuracy by using all available data in your market.