black and gold risk icon
Gold Padlock Icon

Property Condition Assessment
Risk Management

PCA Risk Management Overview

In reference to the line chart on the right (scroll down if and when using a mobile device), the degree of uncertainty or risk associated with a commercial property real estate (RE) transaction increases/decreases based upon the level of detail or due diligence provided by a Commercial Property Condition Assessment (PCA). While it's virtually impossible to assess the level of detail/due diligence of a PCA much less how much a baseline PCA performed according to document ASTM E2018-15 Standard for PCAs may be able to reduce the risk of purchasing a commercial property on a scale of 1-10, the risk factor can vary considerably given a number of uncontrollable variables such as age, authenticity and availability of information, all of which can adversely affect the level of detail/due diligence provided in conducting a baseline PCA. Once more, in reference to the chart, it is most important to understand that the level of uncertainty or risk associated with a commercial property RE transaction can never be zero or entirely eliminated regardless of the level of detail/due diligence provided by a PCA. Moreover, based upon what we have witnessed in years past, unless you have a high risk tolerance along with money to spare and throw away, foregoing a PCA prior to consummating a commercial real estate purchase or lease agreement can easily increase the likelihood of your ending up with a money pit incurring additional expenses you least anticipated to begin with.

Risk Management Line Chart for Commercial Property Condition Assessments