Commercial Office Appraisal

During the second semester of my graduate program, I was able to take Real Estate 715: Principles of Valuation. This course was perhaps my favorite I took in my first year. Although the focus of the class was understanding how the commercial appraisal process works and different ways that buildings can be valued, it also filled in some of the background I felt I was missing from a broader perspective of real estate. We spent quite a bit of the class learning about legal foundations, the basis of cap rates, site analysis, and of course more practice with different financial modeling techniques.

These topics flowed fairly seamlessly into perhaps the largest deliverable I have ever produced in the classroom: a comprehensive, 70-page appraisal of a commercial office building in the Madison market. Our class was divided into groups of three or four, and we went through the entire process that a commercial appraiser would: we obtained official documents regarding the parcel and site characteristics, went of a tour of the property, and used rent rolls to aid in our financial analysis.

Given the nature of the project, each group started during the first half of the semester. It was laborious, but I felt quite accomplished when our group finished and I feel as though we came to an accurate conclusion regarding the value of the office property.

Click here to view our final appraisal.