Commercial Inspections 101: The Challenges and Opportunities

When you undertook inspection training, you likely had home inspecting in mind. There are more home inspectors than commercial building inspectors, but this is just one of the reasons you might want to consider branching out into this area.

Many states have minimal — or no — licensing requirements for home inspectors. While it’s easier to learn the basics of becoming an inspector if you have a background in construction or working with home systems like electrical, plumbing or HVAC, it isn’t necessary. However, when you want to expand your business to include commercial inspections, if you don’t have an extensive background in buildings and systems, you will have to acquire the skills on your own or hire subcontractors to help you.

Commercial Inspection or PCA?

An article in the ASHI Reporter compares and contrasts true commercial inspections with property assessments, outlining how the former is much more detailed than the latter.

With a property assessment, the commercial inspector looks at the building and land and generates a report based on how much the new owner might be expected to invest based on the condition of the property and their intentions for its use.

As it is, most states and municipalities have no specific rules for or definition of commercial inspection. Some inspectors use the ASTM E2018-01 for property condition assessment, but this is an optional guideline, not a requirement. You can use it in its entirety, or you can adopt your own report based on some of the principles contained in the ASTM. Experts agree that a PCA doesn’t go into as much depth as a true commercial inspection.

Here’s a checklist for ASTM inspections to get an idea of what is usually included and what is considered an add-on, like radon, asbestos and lead paint. These might be add-ons you already offer with your home inspections, but some are commercial-specific, like elevators, parking lots or sophisticated sprinkler systems to fight fires.

Commercial Inspector Qualifications

If you want to expand your home inspection business, but you want to keep it small, you can focus on a particular sector or area in which you are most qualified.

For instance, small apartment buildings or storefronts are technically commercial, but their structures and systems are not radically different from the average home. A high-rise, however, or an industrial factory, might be outside your realm of expertise at this point.

If, however, you have a background in engineering, commercial plumbing or a field in which you have gained specific knowledge that can aid you in the commercial inspection business, you may be able to market your services to a wider variety of clients.

If a client needs a more thorough inspection, the commercial inspector must assess what skills and knowledge are necessary to undertake the job and decide whether they are well-suited to the work. Some larger buildings with more complex systems or some clients with more specific needs may opt to hire an engineering firm to complete a comprehensive inspection.

In other cases, you may be part of a team that completes a commercial inspection, with experts in different areas on board to evaluate systems and functions. This can be reassuring because, even though each inspector has their own niche, it’s good to have other team members who might notice an issue you could accidentally overlook.

Leading a Commercial Inspection Team

The lead who pulls this team together is the one who takes on the responsibility for the inspection — and the one who makes the most money. If you have been in the building and construction field for many years and know experts in other specialties you can count on to help you perform commercial inspections, you could have a lucrative side business.

The easiest way to do this is by using your connections in the field, but if you are lacking in any particular area, you can ask other professionals for their recommendations. You could get lucky this way and form a new relationship with a responsible professional you can trust, but don’t assume this is how it will go with whoever you call.

Operating as the lead of a team is like acting as a general contractor, and depending on how the contract is written, you will likely be liable for your subs’ work. At the same time, you are collecting the fee and paying the expert their share, so your shouldering of the responsibility doesn’t go unrewarded.

Commercial Inspections vs. Home Inspections

Some inspectors told the ASHI Reporter that they enjoy the change of working with commercial clients versus homeowners. Buying a home can be an emotional experience, whereas arranging for a commercial inspection is more of a business decision. Thus, commercial inspections don’t have the sentiment attached to them that home inspections do.

As far as fees go, commercial inspections are not necessarily more lucrative, but they can help boost your income. One reason is that the properties are often larger, so these inspections take longer. You might make the same amount of money per hour, but the job will take you more hours. And in most businesses, any big jobs that pay decently are welcome.

Moreover, the home inspection business is often dependent on the economy and your local housing market. Being qualified and available to do commercial inspections makes you more in demand, and therefore able to earn more to get you through the lean times, or to stockpile a bit of cash for an emergency.

Building a Reputation as a Commercial Inspector

One aspect that the field of commercial inspection offers that home inspection doesn’t as much is the potential for referrals and repeat business. You don’t get as much of this with home inspections because people do not move that frequently, and those that do often move out of your area. That’s why it’s so important for home inspectors to form relationships with real estate agents. They’re the constants in the equation. Everyone else is coming and going.

With commercial buildings, the owners are often local, and they may own more than one building. Even if they don’t, they may have business relationships with others who will one day need your services.

Still, the relationship with real estate agents should not be discounted. It is just as useful in the commercial sector. Commercial agents and brokers frequently handle leasing, and the sheer volume of office and other business space in a busy city could provide full-time work. The potential is even greater in an area experiencing growth or revitalization, as much of the commercial space may undergo build outs or renovations that need inspecting.

Liability for Commercial Inspectors

Inspectors who branch out into the commercial sector will need separate contracts for this work, and perhaps more insurance as well. Liability is always an issue when inspecting a building, and the coverage that you have as a home inspector may not be adequate for a commercial inspector.

Take a look at some sample contracts online, download one and have your lawyer and your insurance company take a look at it to make sure you are covered under all scenarios.

While you want to keep the same contract language for all jobs to protect yourself, the truth is that each commercial inspection is likely to be different from the next. The industry doesn’t have the uniformity that home inspection does, and even that presents many different scenarios.

What dictates the rules for commercial inspections is the client and what they expect. Every client is likely to want something different from their commercial inspection, and your job is to make them happy. There is no sense in doing a detailed, 100-page analysis with expert consultants if the client thinks it’s overkill.

Worse, they would likely be unhappy with the cost of such an inspection and might even think you were trying to sell them a service they didn’t want. So let your client dictate what they want from their commercial inspection, and take it from there.

Inspection Training with ICA

When you get your inspection training through ICA School, every subject is covered. You get the practical — roofs, structure, interiors, exteriors, plumbing, heating, air conditioning and electrical, and the business side — report writing, business marketing, and legal considerations. ICA even includes a separate section that just deals with commercial inspections.

We also keep you up to date on burgeoning inspection equipment and strategies such as the use of drones in roof inspections.

And after you earn your real estate inspection certificate, you still have access to our online reference library of thousands of pages of materials addressing situations in homes and commercial buildings such as mold, radon, septic systems, termites and indoor air quality. We also offer guidelines on how to do an energy audit — an add-on many new homeowners are eager to purchase.

You’re never alone when you do your inspection training with ICA. We are here to answer all your questions and offer you all the support you need in your career as a home and commercial building inspector. For more information about becoming a commercial inspector, visit our Commercial Property Inspection Course.