Second Floor Adjustments

[undergroundPOP]

I'm appraising a single-story retail building and one of the comps in the model is a two story building. Now in most cases, I would shy away from comparing single-story and two-story buildings, BUT these two buildings are very similar in GBAs, site sizes, physical condition and location.

What are some common techniques that you use to adjust a two-story building for a single-story subject property?

 

[Gobears81]

If you don't have sales data to suggest the contributory value of the upper floor relative to the first floor, do you have rents?

 

[DanBuck]

I'm appraising a single-story retail building and one of the comps in the model is a two story building. Now in most cases, I would shy away from comparing single-story and two-story buildings, BUT these two buildings are very similar in GBAs, site sizes, physical condition and location.

What are some common techniques that you use to adjust a two-story building for a single-story subject property?

Check first to see if there is a difference in price between the floors from the local market. if your not in a busy retail location or if your space is being used for quasi retail/office space there may not be such an adjustment..

 

[Michael S]

I appraised a typical neighborhood shopping center with a two-story portion. The upstairs tenants (three) were mostly office type tenants and the rents weren't a whole lot lower than the spaces directly below them. I would certainly say a two-story retail is inferior but whether it's 5% or 25% would depend on the data (mostly rents).

 

[undergroundPOP]

Check first to see if there is a difference in price between the floors from the local market. if your not in a busy retail location or if your space is being used for quasi retail/office space there may not be such an adjustment..

Are you referring to differences in lease rates between floors from the market area? I do have that data readily available, but I have yet to analyze it and put it into a table.

 

[DanBuck]

Are you referring to differences in lease rates between floors from the market area? I do have that data readily available, but I have yet to analyze it and put it into a table.

Yes the lease rates..There may be some difference but the idea here is- that depending on what youre using the space for it may not make such a difference (i.e retail used as office). Or, simply the market doesnt recognize a significant difference in price between the two, especially if it isnt a busy retail strip.