With Reonomy’s powerful property intelligence, however, finding a lengthy list of comps is now easier than ever. Sometimes, in order to find a comp, the appraiser may have needed to look well outside of the market area, which wouldn’t make for very reliable comparisons.ĭemographics, leasing trends, access to infrastructure and more may look very different outside of the market area and all can have an impact on the value of the property. Traditionally, the challenge with using the sales comparison approach in commercial real estate was that finding comps could be difficult. This method relies on looking at comps and recent sales data to help assign a value to the property in question. The “ sales comparison approach,” often referred to as the “market approach,” is the appraisal technique used heavily in residential real estate, though is often used in commercial real estate valuation as well. The heightened value and added intricacies make the valuation process a much more complicated beast.īelow, we dive into the best approaches for finding commercial real estate values. Commercial Real Estate ValuationĬommercial real estate valuation is fairly different than residential. On an individual basis, there are a few different methods you can use to determine and double-check the value of any commercial asset. In most cases, your team’s ability to determine property values comes down to the commercial data it has in-hand-especially when reviewing values in-aggregate. Whether on an individual basis or in aggregate, understanding property values is an essential for any business working with commercial real estate in any capacity.
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