Five Different Uses For A Commercial Real Estate Appraisal

Posted on: 26 April 2022

A commercial real estate appraisal is used for determining the value of a commercial property. These appraisals can be requested and used by a wide range of different people. You should be aware of the different uses for a commercial real estate appraisal process. 


Lenders often request a commercial appraisal of a building. They use that to determine the value of a property before they provide someone with a property loan. They want to ensure that they are not over-lending money and over-valuing a property. Their goal is to keep their loan-to-value ratio within reason.

Property Owners

Next, property owners often request appraisals. Getting an appraisal is a great way for a property owner to determine what the value of their property is. It is a way for a property owner to figure out what an appropriate selling price is for their property, so they can decide if they want to go forward with the process.

Prospective Buyers

If someone is interested in purchasing property, they want to have a good idea of what the property is worth. They want to verify the property is worth what it says. An appraisal can ensure that they are not overpaying for the property.

Property Tax Assessment

Another reason to request a commercial real estate appraisal is a property tax assessment. That way, an owner can determine if their property has been over-assessed by their municipality. The appraisal can be a tool to fight what a property owner considers to be an over-assessment. If your property value was over-assessed, this could be a great way to get your property taxes lowered if you feel that you are paying too much for your property taxes.

Legal Situations

Finally, you may need an appraisal for a legal situation. For example, if one business partner is leaving and the other partner is buying them out, an appraisal can be used to determine the value of the property. Or, if you are getting divorced and you need an assessment of the value of the business, getting the value of the property is important. 

When it comes to commercial property real estate appraisals, there are many different ways that the appraisal can be used. It is important to let the appraiser know what it will be used for; that can help the appraiser craft the content in the document for its intended purpose. An appraisal can be useful in numerous contexts and is an important tool for understanding both the value of a property and the value of the business.