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Will Inflation Affect Your Due Diligence?

Will Inflation Affect Your Due Diligence?

With inflation dominating the headlines, and construction costs continuing to escalate, commercial real estate investors may be wondering how these factors affect their Property Condition Assessments (PCA). Does current inflationary pressure impact values in the immediate repairs table (IRT) or the replacement reserve table (RRT)?

In short, the answer is yes and no. Depending on the needs of the entity ordering the report and how the report will be used, the consultant may adjust values in the IRT to reflect current inflation rates—but generally not in the RRT. For an explanation of the variables that affect why and how these adjustments are made, read the full post on GlobeSt.com