A Property Condition Assessment, or PCA, offers an in-depth look at a property to survey the current condition of the building or asset and to reveal any short-term or long-term repair and replacement needs. Many commercial lenders employ this proactive approach to avoid potential risk later in the life of a loan that uses an existing building as collateral.
During a PCA, a qualified engineer will interview someone with detailed knowledge of the property to learn about the age and maintenance of the various systems and components. They will also perform a field inspection using ASTM standards as a benchmark to determine the condition of the following:
- Mechanical, Electrical, and Plumbing Components and Systems
- Building Envelope
- Structural Components
- Interior Elements
- Vertical Transportation
- Life Safety Mechanisms
The field inspector will not inspect concealed spaces or otherwise inaccessible areas of a building.
In addition to reporting on the physical aspects of the property, the investigator will provide a complete cost analysis of the costs to repair or replace any portion of the property based on current construction costs in the area where the property is located. The information garnered from this evaluation is a valuable tool used to ascertain investment and capital risks on a building and its systems when a borrower is using the asset as collateral or when a lender is lending money for improvements to the building or building systems.
Lenders who employ Dayhill’s PCA are always happy that they did. It offers a greater understanding of the property in question so they can make informed decisions about their construction lending.