Exploring and Inspecting Properties

To effectively complete a commercial appraisal or multifamily housing rent comparability study we are required to conduct a thorough exterior and interior inspection of subject properties.  COVID-19 has presented challenges but has not stopped the FRG team from completing comprehensive site inspections.

In the late Spring, as the country began to slowly re-open our client requests increased.  FRG team members often take multi-day trips many times via air travel to complete site inspections.  In early June, FRG had a client commitment requiring an inspection of a property on the border of the states of Wisconsin and Michigan.  Having previously completed projects in the same area, I knew the fastest route to the site was via a one-hour direct flight from Cleveland to Milwaukee and 2.5-hour car drive north of Mitchell Airport to the site.

As I explored this travel option, I found direct flights were no longer available.  As well, my preferred airline only had two flights leaving each day with Milwaukee as the destination.  And the available flights had a total travel time of almost six hours.  Further, both flights would require an overnight stay in Milwaukee.

I needed to find another travel option.

I considered driving and discovered a one-way trip to the site from Cleveland would be a ten-hour drive.  Further, this option would require an overnight hotel stay.  At that time, many hotels, especially those in rural areas were struggling with remaining open and offered few amenities.  Thus, I did not see a hotel stay as a viable option.

I still needed to find another travel option.

I needed an option which would allow me to drive to the location, as well provide lodging and a meal prep solution.  I decided my best option was to rent a recreation vehicle or RV.   I found the airbnb for RVs – something I never knew existed.  I promptly booked a Class B Airstream for the trip.

The day before the scheduled inspection, I headed out on the open road.  After driving seven hours and crossing the Mackinaw Bridge I found myself in Ignace, Michigan, a town of less than 2,500.  And it was time to find a place to retire for the night, which presented a challenge.  At the time of my travel, COVID-19 state restrictions did not allow reservations or stays at RV campgrounds, thus I could either boondock – park on public land or dry camp – stay in a parking lot.  I decided to dry camp, with the options of staying overnight in the local police station, fire department or hospital parking lot.  I chose the hospital.  After dinner, a restful sleep, shower, and breakfast I was on the road again for 3.5 hours to the subject property to complete the scheduled inspection.

The RV turned out to be a great travel solution.  I was able to complete the site inspection as well as the comparable property inspections in relative comfort.  And as a bonus on my return I had time and diesel fuel, so I stopped along the way and explored – Hiawatha National Forest, Great Lakes Memorial Marina, Mackinaw City, and a sand dune.

I highly recommend RV travel as an affordable, comfortable, and safe travel option.

COVID-19

Feasibility Research Group (FRG) is a privately-owned real estate services company specializing in commercial real estate appraisal, inspection, and research.  Like many small businesses, FRG has been impacted by COVID-19.

However, the services that we provide are deemed essential by most states and thus we remain willing and able to assist you with your appraisal services and market research needs.

FRG practices social distancing.  Currently, all employees are working from remote locations.  Further, if an FRG appraiser is conducting an on-site inspection he/she will practice social distancing during the subject property inspection.

The FRG appraiser conducting the inspection will:

  • Maintain six feet distance from all property contacts
  • Request that only one person accompany the appraiser on the inspection
  • Not touch any fixtures, door handles, light switches, etc in the facility
  • Require unobstructed access and views of the interior of the building
  • Wear protective covering including but not limited to gloves and face masks

Further, as much as possible FRG appraisers will seek to conduct virtual interior inspections leveraging technology such as Skype and/or FaceTime*.

FRG will continue to monitor the coronavirus and its impact very carefully and provide updates as needed.

 

*NOTE: USPAP does not require a physical inspection. Appraisal Foundation Statement

The Appraisal Foundation, Fannie Mae, Freddie Mac and the Appraisal Institute have deemed virtual inspections to be acceptable.

 

The Struggle to Find Home Sweet Home

As our MAI appraisers complete multifamily housing commercial appraisals and rent comparability studies (RCS) for HUD and private clients, FRG has extensive multifamily housing knowledge.  And as a result FRG has a great deal of interest in remedies to the affordable housing shortage.

I can still remember signing my first apartment lease.  I was 19 years old and excited to move into my very own 500 sq-ft, one bedroom, one-bathroom home.  Well it wasn’t all mine, because I could not afford the apartment, thus I had a roommate.  Even with a roommate, this was the first time I felt like a responsible adult.

Unfortunately, many today are struggling to find a place to call home.  Nationally, the number of renters has reached historic highs, and as a result it is becoming increasing difficult for many to find safe, quality affordable housing.  In fact, according to a Harvard University Housing Study the availability of affordable rental housing is being affected by:

  • High rental demand and low vacancy rates, which allow landlords to continually increase rental rates
  • Demand from higher income renters is driving the construction of luxury vs affordable multifamily rental housing

A recent Ohio Housing Finance Agency report that assessed the state’s housing needs noted that lower income Ohioans are struggling to pay for housing as they spend more than 30% of their income on housing.  The agency discovered that there are only 43 available and affordable rental units for every 100 extremely low-income renter.  And these extremely low-income renter households are typically made up disproportionately with seniors and/or small children.

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COMMERCIAL REAL ESTATE APPRAISAL ASSISTANT POSITION

Feasibility Research Group (FRG), a privately-owned real estate services company specializing in commercial real estate appraisal, appraisal review, inspection, and research.  We are seeking a Commercial Real Estate Appraisal Assistant.

ESSENTIAL DUTIES AND RESPONSIBILITIES include the following:

  • Search public databases (eg county auditor, county recorder’s office, etc.) and websites for subject property information (eg property zoning, taxes, deeds, etc.)
  • Contact brokers and market participants to verify commercial real estate comparable properties sales transactions and how they compare to the subject property
  • Contact property managers/leasing agents to verify apartment data including rental rates, occupancy levels, amenities, etc
  • Conduct online research on commercial properties
  • Accurately enter research findings for subject properties, commercial real estate and apartment complex rentals into FRG’s company database
  • Concisely and accurately write summaries of research findings
  • Assist appraisers with research and analysis of subject and comparable properties
  • Other duties may be assigned
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FRG Wins 5-Year Contract with HUD

Feasibility Research Group (FRG) selected to perform rent comparability and post-rehabilitation studies (RCS) for the Midwest Region.

University Heights, OH (August 12, 2019) — FEASIBILITY RESEARCH GROUP (FRG), a real estate services firm based in Northeast Ohio, has been selected to provide rent comparability studies (RCS) for multifamily housing properties in the Midwest Region.  The Midwest Region includes the following states: Illinois, Indiana, Michigan, Minnesota, Ohio and Wisconsin.

The US Department of Housing and Urban Development requires the completion of rent comparability studies in compliance with the latest version of Chapter 9 of the Section 8 Renewal Policy Guide.

“We are excited to work with the US Department of Housing and Urban Development” said Gregory Williams, MAI and FRG‘s Owner and Managing Director. “We are looking forward to helping to provide safe and affordable housing to communities throughout the Midwest.”

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My 1st Leadership Development and Advisory Council Session

For more than 85 years, the Appraisal Institute (AI) has been a global professional association of real estate appraisers.  AI works to develop real estate industry leaders and establish an appraiser presence in the United Stated Congress through its Leadership Development and Advisory Council (LDAC).  The Council is a group of dedicated appraisers who together once a year in Washington DC to generate solutions to challenges facing the appraisal profession.

Last month, I had the pleasure of attending my first LDAC session in Washington DC.  I entered with no expectations other than using it as an opportunity to learn more about the Appraisal Institute and offer up a thought or two on promoting our industry.  By the end of the week, I walked away from LDAC exceeding those expectations.

The LDAC discussion sessions afforded the opportunity to engage and brainstorm with appraisal professionals from all around the country.  The sessions served as opportunity for us to come together to generate actionable ideas to solve some of the appraisal industry’s toughest problems.  Serving as a member of the Ohio Chapter’s education committee I was very passionate about the education discussions. Based on my experience, I know that AI’s educational offering is superior to other competitive offerings.  Our group discussed ideas on how to not only get non-AI members to take AI courses but to also use our education offering to entice non-members to become members.

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Adventures in Property Inspections

As a MAI designated commercial appraiser, over the past 10 years, I have conducted a couple of thousand commercial property inspections, and each inspection is as unique as the commercial property appraisal.  During an inspection I am typically accompanied by the owner or the owner’s agent.  Most times the inspections are uneventful, and the owner/agent is helpful in providing insightful property, neighborhood and market area information needed to complete a comprehensive appraisal of the subject property.  However, there have been occasions when the inspection becomes eventful –

The Helpful Owner

I do occasionally encounter owners who want to point out all the subject property’s current or planned amenities that they believe will significantly impact the value.  Earlier this year I appraised an office park complex located parallel to a major highway in central Ohio.  I was advised by the lender that the complex was fully leased and thus the income approach would be required.  During the inspection, the owner shared that he thought it was vital that I consider the fact that he could have a billboard on his property which would generate additional income.  Further, the owner spent a considerable amount of time sharing his marketing brochures to clearly demonstrate the type of tenants he would soon have in the complex.  At the time of the inspection, the owner was the only tenant in the office complex, while the lender thought the property was fully leased.

The Fearful Tenant

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