What Is Real Estate Analysis?

    Real estate analysis is the process of collecting and evaluating all relevant information to make informed decisions about property acquisition, rental, sale, or development. 

     Obtaining this data is complex and involves several components: 

    • Market analysis: Market analysis provides an estimated property value based on location, current condition, nearby attractions, and other factors. 
    • Location evaluation: Local amenities and infrastructure are assessed, along with pending construction, sales and rental prices, occupancy rates, crime levels, and other details that make a geographic area more or less desirable. 
    • Property valuation: The value of the property itself is assessed, including how much it will cost to refurbish, restore, and maintain it. For a business, it’s worth noting local foot traffic patterns and the proximity of the space to schools, public transportation, medical facilities, retail, and recreation.
    • Risk assessment: Before buying or investing in real estate, advisors evaluate potential economic, environmental, and regulatory risks that may potentially impact property values and investment returns. 
    • Financial feasibility studies are used to analyze whether a project might be successful by determining if the company has the resources to complete the project, and whether the potential ROI is high enough to make it worthwhile. 

    Real estate metrics are more than just numbers on a page. They can assist in creating a roadmap to help your company navigate the current economy. They may be helpful tools for the objective to allocate resources with exactness, gain a competitive edge, and optimize productivity. 

    Long-Term Considerations 

    Real estate analysis also considers the long-term performance and potential costs associated with updating facilities for greater sustainability and energy efficiency. Existing spaces may require extensive modification to integrate emerging technologies and meet the ever-changing demands of the modern workplace. 

    While green building practices might be slightly more expensive in the construction phase, they may potentially lead to lower operational costs over the property's lifecycle. Using market analysis, decision-makers can time these projects strategically to manage higher occupancy rates and sales prices while creating healthier spaces for people and the planet.  

    Real Estate Analysis Across Operations 

    The data obtained through real estate investment analysis has far-reaching strategic implications. It influences the timing of facility consolidation and expansion planning and may help owners develop strategies for expanding into new markets. 

    Companies conduct real estate analysis at different business stages, whether assessing a possible acquisition, determining if development is feasible, or making lease vs. buy decisions backed by concrete evidence. 

    Using this analysis, companies may identify inefficiencies, potentially reduce costs, strive to maximize value across assets and operations, manage their portfolio, and possibly mitigate the impact of market fluctuations.  

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    DISCLOSURES:

    • Information presented is general in nature and should not be viewed as a comprehensive analysis of the topics discussed. It is intended to serve as a tool containing general information that should assist you in the development of subsequent discussions. Content does not involve the rendering of personalized investment advice nor is it intended to supplement professional individualized advice.   
    • Hiring a qualified advisor and/or financial planner does not guarantee investment success, and does not ensure that a client or prospective client will experience a higher level of performance or results. No guaranty or warranty is made that any direct or implied results or projections being represented here will be met or sustained.
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