Whether you’re a real estate agent, property owner, or business person, knowing what comps are and how to find them is essential to making informed business decisions and deals related to your property. Though there are many services and tips for finding public comparables, knowing how to find comps for commercial real estate can be a bit harder if you are new to the game or don’t know what to look for.
You must consider several aspects to find accurate and reliable commercial real estate comps, including the size, location, age, and type of commercial property. With this in mind, you will likely need to find the property sales history and contact an agent if you want accurate and reliable comps.
Comps, or comparable properties, are other properties that are similar to the one you are looking to buy, sell, or lease, giving you an insight into what you can expect to make or pay for the property. For this reason, having a reliable way to find comps for commercial real estate is essential to help you make informed business decisions relating to property.
How To Find Comps For Commercial Real Estate
If you are looking to buy, sell, or lease commercial real estate, finding comps is essential to help you determine the fair market value of the property in question. Once you have a list of comparable properties, you can make informed decisions, such as valuing the property you are working with, determining the possible returns on investment, and even finding new property opportunities.
With all of this in mind, the steps below will show you how to find comps for commercial real estate to help you make the best choice for yourself and your business and possibly find details on how to make the property more valuable.
Analyze The Property To Find The Relevant Data
If you want to know how to find comps for commercial real estate, first, you need to analyze the property aspects you want to focus on to find similar properties. Without the relevant data, there is no way to find other properties comparable to the one in question.
Some of the essential aspects to consider when determining the property criteria are:
- The size of the property in square feet
- The location of the property
- The return on investment
- The type of commercial activity it gets used for, such as office space or retail space
- The age of the building and the condition of the building
- Any special or unique features the property has that may add a specific value to the property
There may also be other aspects that you should consider when finding comps for commercial real estate. However, with the list of criteria above, you should be able to calculate other vital aspects, such as price and income per square foot.
Get Professional Appraisal (Optional)
Though this is not essential if you want to sell your commercial property and find the most accurate comps, getting in touch with a professional to do an official appraisal may be worth the cost. Not only can professional help give you an estimate of the price, but it may also help you in other ways.
When an agent does an appraisal, there is likely a list of similar properties to which the appraiser may have access to ensure they give a more accurate price. Not only may you be able to ask how certain aspects of the property affect the price, but you may even find a list of comps from the appraiser if they are willing.
Use Public Records To Find Relevant Information
One of the best ways to find comps and assess a property is by using public records and services to find property ownership records. Property ownership records allow you to look at the sales a property has undergone, the pricing, and other details of the property you are looking for.
In addition, if you find public records for the property in question, you may also find a list of other recently sold properties that you can go through to see how closely they match the property you are looking to buy, sell, or lease. With a list of other properties that recently got sold, you should be able to make a list of properties similar to the one in question, giving you a list of comparable properties.
Speak To Real Estate Professionals
Another great way to get a list of comparable properties is to contact the people who set up the contracts and manage the deals, the estate agents, and professionals. Suppose you know any real estate professionals in the area of the property in question. In that case, you may be able to ask them for a list of similar properties so you can compare and get a rough estimate of the fair market value.
Often, real estate professionals will have a list of properties compiled that you can use to find comps if you can find an agent willing to help you.
Use Real Estate Websites
Whether you can find a real estate agent willing to help you or not, it is not uncommon to find agencies with websites with various listings and filters you can use to build a list of comparables, such as this website.
These websites often allow you to look for properties with specific criteria and allow you to apply filters such as size, location, and property type. If you are willing to take the time to apply the suitable filters, you may be able to use an estate agency website to create a list of comps.
Use Online Platforms To Get More Comp Results
In addition to real estate agency websites, in recent years, several new platforms have been created to help you when you don’t know how to get comps for commercial real estate. Platforms and services such as Crexi, Commercial Edge, and Reonomy are willing to help you find comps, though there may be a fee that you need to pay to make use of the full features of these services.
With this in mind, if you are willing to spend some money and time on finding the right online comp tool, purchasing a subscription to one of these services may make your life much easier. Tools like these are great if you want to buy, lease, or sell a commercial real estate property; they also allow you to monitor the market and keep you up to date with commercial property prices in specific areas.
Conclusion
Finding accurate and reliable comps for commercial real estate is essential to the research you must do when working with commercial properties. Not only can a list of comps give you an estimate of a property’s fair market value, but it may also help increase the value of a commercial property. The list of steps above should show you how to find comps for commercial real estate with or without paid tools.