ASTM E2018 – 08 Standard Guide for Property Condition Assessments: Baseline Property Condition Assessment Process
Significance and Use

Use—This guide is intended for use on a voluntary basis by parties who desire to obtain a baseline PCA of commercial real estate. This guide also recognizes that there are varying levels of property condition assessment and due diligence that can be exercised that are both more and less comprehensive than this guide, and that may be appropriate to meet the objectives of the user. Users should consider their requirements, the purpose that the PCA is to serve, and their risk tolerance level before selecting the consultant and the level of due diligence to be exercised by the consultant. The user should also review or establish the qualifications, or both, of the proposed field observer and PCR reviewer prior to engagement. A PCR should identify any deviations or exceptions to this guide. Furthermore, no implication is intended that use of this guide be required in order to have conducted a property condition assessment in a commercially prudent and reasonable manner. Nevertheless, this guide is intended to reflect a reasonable approach for the preparation of a baseline PCA.

Clarification of Use:

Specific Point in Time—A user should only rely on the PCR for the point in time at which the consultant’s observations and research were conducted.

Site-Specific—The PCA performed in accordance with this guide is site-specific in that it relates to the physical condition of real property improvements on a specific parcel of commercial real estate. Consequently, this guide does not address many additional issues in real estate transactions such as economic obsolescence, the purchase of business entities, or physical deficiencies relating to off-site conditions.

Who May Conduct—The walk-through survey portion of a PCA should be conducted by a field observer, and the PCR should be reviewed by a PCR reviewer; both qualified as suggested in X1.1.1.1 and X1.1.1.2, respectively.

Principles—The following principles are an integral part of this guide. They are intended to be referred to in resolving ambiguity, or in exercising discretion accorded the user or consultant in conducting a PCA, or in judging whether a user or consultant has conducted appropriate inquiry or has otherwise conducted an adequate PCA.

Uncertainty Not Eliminated—No PCA can wholly eliminate the uncertainty regarding the presence of physical deficiencies and the performance of a subject property’s building systems. Preparation of a PCR in accordance with this guide is intended to reduce, but not eliminate, the uncertainty regarding the potential for component or system failure and to reduce the potential that such component or system may not be initially observed. This guide also recognizes the inherent subjective nature of a consultant’s opinions as to such issues as workmanship, quality of original installation, and estimating the RUL of any given component or system. The guide recognizes a consultant’s suggested remedy may be determined under time constraints, formed without the aid of engineering calculations, testing, exploratory probing, the removal or relocation of materials, design, or other technically exhaustive means. Furthermore, there may be other alternative or more appropriate schemes or methods to remedy a physical deficiency. The consultant’s opinions generally are formed without detailed knowledge from those familiar with the component’s or system’s performance.

Not Technically Exhaustive—Appropriate due diligence according to this guide is not to be construed as technically exhaustive. There is a point at which the cost of information obtained or the time required to conduct the PCA and prepare the PCR may outweigh the usefulness of the information and, in fact, may be a material detriment to the orderly and timely completion of a commercial real estate transaction. It is the intent of this guide to attempt to identify a balance between limiting the costs and time demands inherent in performing a PCA and reducing the uncertainty about unknown physical deficiencies resulting from completing additional inquiry.

Representative Observations—The purpose of conducting representative observations is to convey to the user the expected magnitude of commonly encountered or anticipated conditions. Recommended representative observation quantities for various asset types are provided in Annex A1; however, if in the field observer’s opinion such representative observations as presented in Annex A1 are unwarranted as a result of homogeneity of the asset or other reasons deemed appropriate by the field observer, the field observer may survey sufficient units, areas, systems, buildings, etc. so as to comment with reasonable confidence as to the representative present condition of such repetitive or similar areas, systems, buildings, etc. To the extent there is more than one building on the subject property, and they are homogeneous with respect to approximate age, use, basic design, materials, and systems, it is not a requirement of this guide for the field observer to conduct a walk-through survey of each individual building’s systems to describe or comment on their condition within the PCR. The descriptions and observations provided in the PCR are to be construed as representative of all similar improvements.

User-Mandated Representative Observations—A user may mandate the representative observations required for a given property or a particular building system. Such representative observations may be more or less than this guide’s recommended representative observations as provided in Annex A1.

Extrapolation of Findings—Consultant may reasonably extrapolate representative observations and findings to all typical areas or systems of the subject property for the purposes of describing such conditions within the PCR and preparing the opinions of probable costs for suggested remedy of material physical deficiencies.

Level of Due Diligence is Variable—Not every property will warrant the same level of property condition assessment. Consistent with good commercial and customary practice, the appropriate level of property condition assessment generally is guided by the purpose the PCA is to serve; type of property; age of the improvements; expertise and risk tolerance level of the user; and time available for preparing the PCR and reviewing the opinions to be contained in the PCR.

Prior PCR Usage—This guide recognizes that PCRs performed in accordance with this guide may include information that subsequent users and consultants may want to use to avoid duplication and to reduce cost. therefore, this guide includes procedures to assist users and consultants in determining the appropriateness of using such information. In addition to the specific procedures contained elsewhere in this guide, the following should be considered:

Use of Prior PCR Information—Information contained in prior property condition reports may be used by the consultant if, in the consultant’s opinion, it is relevant; however, users and consultants are cautioned that information from prior property condition reports should only be used if such information was generated or obtained through procedures or methods that met or exceeded those contained in this guide. Such information should serve only as an aid to a consultant in fulfilling the requirements of this guide and to assist the field observer in the walk-through survey, research, and the field observer’s understanding of the subject property. Furthermore, the PCR should identify the previously prepared property condition report if information from the prior report was used by the consultant in preparing the PCR.

Comparison with a Previously Prepared PCR—It should not be concluded or assumed that a previous PCR was deficient because the previous PCA did not discover a certain or particular physical deficiency, or because opinions of probable costs in the previous PCR are different. A PCR contains a representative indication of the property condition at the time of the walk-through survey and is dependent on the information available to the consultant at that time. Therefore, a PCR should be evaluated on the reasonableness of judgments made at the time and under the circumstances in which they are made. Experience of the field observer, the requirements of the previous PCR’s client or the purpose of the previous PCR, time available to the consultant to complete the PCR, hindsight, new or additional information, enhanced visibility as a result of improved weather or site conditions, equipment visibility as a result of improved weather or site conditions, equipment not in a shutdown mode, and other factors influence the PCA and the opinions contained in the PCR.

Conducting Current Walk-Through Surveys—Except as provided in 3.5.1, prior property condition reports should not be used without verification. At a minimum, for a PCR to be consistent with this guide, a new walk-through survey, interviews, and solicitation and review of building and fire department records for recorded material violations should be performed.

Actual Knowledge Exception—If the user or consultant conducting a PCA has actual knowledge that the information from a prior property condition report is not accurate, or if it is obvious to the field observer that the information is not accurate, such information from a prior property condition report should not be used.

Contractual Issues—This guide recognizes that contractual and legal obligations may exist between prior and subsequent users of property condition reports, or between clients and consultants who prepared prior property condition reports, or both. Consideration of such contractual obligations is beyond the scope of this guide. Furthermore, a subsequent user of a prior PCR should be apprised that it may have been prepared for purposes other than the current desired purpose of the PCR and should determine the contractual purpose and scope of the prior PCR.

Rules of Engagement—The contractual and legal obligations between a consultant and a user (and other parties, if any) are outside the scope of this guide. No specific legal relationship between the consultant and the user was considered during the preparation of this guide.

1. Scope

1.1 Purpose—The purpose of this guide is to define good commercial and customary practice in the United States of America for conducting a baseline property condition assessment (PCA) of the improvements located on a parcel of commercial real estate by performing a walk-through survey and conducting research as outlined within this guide.

1.1.1 Physical Deficiencies—In defining good commercial and customary practice for conducting a baseline PCA, the goal is to identify and communicate physical deficiencies to a user. The term physical deficiencies means the presence of conspicuous defects or material deferred maintenance of a subject property’s material systems, components, or equipment as observed during the field observer’s walk-through survey. This definition specifically excludes deficiencies that may be remedied with routine maintenance, miscellaneous minor repairs, normal operating maintenance, etc., and excludes de minimis conditions that generally do not present material physical deficiencies of the subject property.

1.1.2 Walk-Through Survey—This guide outlines procedures for conducting a walk-through survey to identify the subject property’s physical deficiencies, and recommends various systems, components, and equipment that should be observed by the field observer and reported in the property condition report (PCR).

1.1.3 Document Reviews and Interviews—The scope of this guide includes document reviews, research, and interviews to augment the walk-through survey so as to assist the consultant’s understanding of the subject property and identification of physical deficiencies.

1.1.4 Property Condition Report—The work product resulting from completing a PCA in accordance with this guide is a Property Condition Report (PCR). The PCR incorporates the information obtained during the Walk-Through Survey, the Document Review and Interviews sections of this guide, and includes Opinions of Probable Costs for suggested remedies of the physical deficiencies identified.

1.2 Objectives—Objectives in the development of this guide are to: (1) define good commercial and customary practice for the PCA of primary commercial real estate improvements; (2) facilitate consistent and pertinent content in PCRs; (3) develop pragmatic and reasonable recommendations and expectations for site observations, document reviews and research associated with conducting PCAs and preparing PCRs; (4) establish reasonable expectations for PCRs; (5) assist in developing an industry baseline standard of care for appropriate observations and research; and (6) recommend protocols for consultants for communicating observations, opinions, and recommendations in a manner meaningful to the user.

1.3 Considerations Beyond Scope—The use of this guide is strictly limited to the scope set forth in this section. Section 11 and Appendix X1 of this guide identify, for informational purposes, certain physical conditions that may exist on the subject property, and certain activities or procedures (not an all inclusive list) that are beyond the scope of this guide but may warrant consideration by parties to a commercial real estate transaction to enhance the PCA.

1.4 Organization of This Guide—This guide consists of several sections, an Annex and two (2) Appendixes. Section 1 is the Scope. Section 2 on Terminology contains definitions of terms both unique to this guide and not unique to this guide, and acronyms. Section 3 sets out the Significance and Use of this guide, and Section 4 describes the User’s Responsibilities. Sections 5 through 10 provide guidelines for the main body of the PCR, including the scope of the Walk-Through Survey, preparation of the Opinions of Probable Costs to Remedy Physical Deficiencies, and preparation of the PCR. Section 11 provides additional information regarding out of scope considerations (see 1.3). Annex A1 provides requirements relating to specific asset types, and where applicable, such requirements are to be considered as if integral to this guide. Appendix X1 provides the user with additional PCA scope considerations, whereby a user may increase this guide’s scope of due diligence to be exercised by the consultant beyond this guide’s baseline level. Appendix X2 outlines the ADA Accessibility Survey.

1.5 Multiple Buildings—Should the subject property consist of multiple buildings, it is the intent of this guide that only a single PCR be produced by the consultant to report on all of the primary commercial real estate improvements.

1.6 Safety Concerns—This guide does not purport to address all of the safety concerns, if any, associated with the walk-through survey. It is the responsibility of the consultant using this guide to establish appropriate safety and health practices when conducting a PCA.

That’s a question that we never want to ask and a GFCI can help protect our kids.

What is a GFCI? 

A GFCI, or Ground Fault Circuit Interrupter, is an automatic device that offers personal protection against electrical shock. They are installed in areas where known electrical shock hazards exist… outdoor outlets and fixtures, swimming pools, saunas and hot tubs, outlets in kitchens, basements, bathrooms, and garages.  Wherever there is the potential for contact between a person and an electrical appliance in or near moisture, water, or water piping, a GFCI should be protecting the circuit… and you!

How Does a GFCI Work?

Inside of a GFCI is a sensor that detects changes in current to the appliance by comparing the current flowing to the appliance and the current flowing from the appliance.  A drop off in the current equivalent to about 5 milli-amperes turns off all power by tripping a relay within the GFCI within a few hundredths of a second. You might hardly even feel the shock, it happens so quickly!

However, there is still a danger since 5 mille-amperes can cause a “jerk reflex” or spasm in the muscles.  This is not too bad if you are standing on the ground but potentially dangerous if you are on a ladder or roof!

GFCI’s can be reset to restore power to the affected circuit.  If the problem still exists, though, the GFCI will not reset.

Types of GFCIs.

The three basic types used in homes are the GFCI outlet, the GFCI circuit breaker and the portable GFCI. All perform the same function each has different applications and limitations.

The GFCI outlet (shown above) is intended as a replacement for a standard electrical outlet. It protects any appliance plugged into it, and can also be wired to protect other outlets that are connected to it.

IMPORTANT:  A GFCI outlet is not difficult to install, but the instructions for installation and testing must be followed precisely to insure the GFCI works properly!!

The GFCI circuit breaker controls an entire circuit, and is installed as a replacement for a circuit breaker on your home’s main circuit board. Some homes are wired so that all bathrooms or all outdoor fixtures are on the same circuit. Rather than install multiple GFCI outlets, one GFCI circuit breaker can protect the entire circuit.

If you decide that the GFCI circuit breaker is your best option, you must purchase one that is a match for your main electrical panel. If you have an older panel that utilizes fuses, you cannot use a GFCI circuit breaker and must use GFCI outlets instead.

Resetting a GFCI circuit breaker is a little different than resetting an outlet-type GFCI.  There is no “reset” switch.  Instead, the GFCI breaker is reset by first switching the breaker to the full “off” position, then to the full “on” position to restore power.

There is also a portable GFCI that is often used by contractors as shown below:
They can work as well as the ones installed in your house. In fact, some appliances such as hair dryers are now coming from the factory with GFCIs built into the power cords.  Portable GFCI’s are frequently used by contractors on worksites.

Portable GFCIs do not need a ground to function, since they are designed the same as stationary ones. So if the GFCI is operating properly, it will protect you even in ungrounded situations.  However, if the tool or appliance you are using has a grounded three prong plug, you should never defeat it with an adapter unless you ground the adapter.  The GFCI will offer no protection from the type of shock that can result from improper grounding of the tool!!

Always perform a safety test on your portable GFCI each time before using it. Push the TEST button, which should kill power to the outlets.  Then, press the reset button to restore power to the GFCI outlets.

IMPORTANT NOTE: Do not use portable GFCIs in place of permanent ones in your home! They are intended to be used in situations where you must bring power from an unprotected outlet into a hazardous situation. For example, if you ran an extension cord from a living room outlet (probably unprotected) to the front yard to cut lumber on the lawn!

Testing a GFCI

All GFCIs, whether local or central, have two testing-related buttons on them.  One button is appropriately labeled TEST, and one is labeled RESET.  Turn on an appliance or light fixture connected to the GFCI.  Press the TEST button, and the appliance should immediately turn off.  If it does not, either the GFCI is miswired, there is a problem with other wiring in the same circuit, or the GFCI has malfunctioned and should be replaced.  Pressing the RESET button will restore power to the appliance or circuit.

Conversely, if you have a GFCI that has tripped and will not reset, you may have a wiring short in the circuit, a defective appliance on the circuit, or the GFCI itself has become defective.

The easiest way to troubleshoot a GFCI is to obtain a GFCI tester, available at most hardware stores. It plugs into the GFCI outlet, and will supply you with a “snapshot” of your connections, indicating wiring problems and/or the condition of the GFCI. Another way to troubleshoot is to simply purchase a new GFCI and install it.

The GFCI in my kitchen seems to trip more often. Do GFCIs wear out?

Yes, they sure do! Over time, a GFCI will become more sensitive to minor variations in current that are caused by certain types of appliances. Hair dryers and space heaters are notorious for stressing and tripping GFCIs.  Replacing the GFCI will help solve this problem, though it may recur eventually as the new GFCI ages.

Does a GFCI need to be grounded to work properly? I would like to install a GFCI in my bathroom but the outlet is the old, 2-pronged type.

According to the NEC, it is allowable to install GFCI’s in ungrounded situations. This makes sense, since the GFCI is not dependent of the ground to function. Remember, it does not measure shorts to the ground, it measures the current difference between the hot and neutral wires. A sudden difference, indicating that there is another path for the electricity to flow through… you, for example, causes the GFCI to open the circuit and save you from permanently curly hair.

Of course, most safety-conscious electricians prefer not to install a grounded-type “three prong” outlet in an ungrounded situation.  Think about it… once the outlet is installed, there is no way for anyone to know if the outlet is really grounded or not without testing it.  Thus, there is a hidden shock hazard should an appliance or tool that needs grounding… has three-prong plug…  is plugged into this outlet.

However, the NEC allows GFCI’s to be installed in ungrounded situations PROVIDED THAT the outlet is labeled “ungrounded”.  Though not “officially” approved in the NEC, the grounding hole in the GFCI can be permanently defeated by using an epoxy or other adhesive to seal the hole.

Though a GFCI will activate if a grounded appliance develops an electrical short circuit to ground… such as when YOU touch a metal saw and become the path to ground… you will experience a momentary electrical shock.  This could be a minor tingle or could be more catastrophic, especially if you are on a ladder or roof.  This excerpt is from an OSHA (Occupational Safety and Health Administration) article on wiring in nursing homes and the dangers to employees working with ungrounded outlets…

“The ground-fault circuit interrupter, on the other hand, is a fast-acting device which senses small current leakage to ground and, in a fraction of a second, shuts off the electricity and interrupts its faulty flow to ground. The rapid response of the GFCI is fast enough to prevent electrocution and this protection is independent of the condition of the grounding conductor.

A GFCI can prevent an electrocution; however, it cannot by itself prevent an initial electric shock to an employee before it interrupts the circuit. This initial shock could lead to injuries of an indirect or secondary nature in which involuntary muscular reaction could cause bruises, bone fractures, and even death resulting from collisions or falls. Therefore, GFCIs are in addition to, and not in lieu of, equipment grounding conductor requirements.”

Here’s a link to the complete article:  http://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=FEDERAL_REGISTER&p_id=13346 )

Are there any situations in which a GFCI will not provide the shock protection for which it as designed?

GFCI’s are not effective in certain circumstances.  As mentioned earlier, they work by measuring the difference between the electrical current going INTO an appliance and the current going OUT of the appliance.  This assumes that the person being shocked is grounded.   If you were ungrounded and touched the hot and neutral wires at the same time, there would be no drop in current detected, so the GFCI would not activate.  Then, you would be at the mercy of the fuses or circuit breakers, which may or may not stop the current before it’s too late!

A second situation where a GFCI will not protect you is when a second, unprotected circuit is involved in an accident.  This can happen when a wire is accidentally drilled into or a metal screw penetrates a wire hidden in the wall.  Unless this second circuit is also protected, you are at full risk of electrocution, even if the tool itself is on a protected circuit!

Arc Faults

Problems in home wiring, like arcing and sparking, are associated with more than 40,000 home fires each year. These fires claim over 350 lives and injure 1,400 victims annually.

A new electrical safety device for homes, called an arc fault circuit interrupter or AFCI, is expected to provide enhanced protection from fires resulting from these unsafe home wiring conditions.

Typical household fuses and circuit breakers do not respond to early arcing and sparking conditions in home wiring. By the time a fuse or circuit breaker opens a circuit to defuse these conditions, a fire may already have begun.

Several years ago, a CPSC study identified arc fault detection as a promising new technology. Since then, CPSC electrical engineers have tested the new AFCIs on the market and found these products to be effective.

Requiring AFCIs

AFCIs are already recognized for their effectiveness in preventing fires. The most recent edition of the National Electrical Code, the widely-adopted model code for electrical wiring, will require AFCIs for bedroom circuits in new residential construction, effective January 2002.

Future editions of the code, which is updated every three years, could expand coverage.

AFCIs vs. GFCIs

AFCIs should not be confused with ground fault circuit interrupters or GFCIs. The popular GFCI devices are designed to provide protection from the serious consequences of electric shock.

While both AFCIs and GFCIs are important safety devices, they have different functions. AFCIs are intended to address fire hazards; GFCIs address shock hazards. Combination devices that include both AFCI and GFCI protection in one unit will become available soon.

AFCIs can be installed in any 15 or 20-ampere branch circuit in homes today and are currently available as circuit breakers with built-in AFCI features. In the near future, other types of devices with AFCI protection will be available.

Should You Install AFCIs?

You may want to consider adding AFCI protection for both new and existing homes. Older homes with ordinary circuit breakers especially may benefit from the added protection against the arcing faults that can occur in aging wiring systems.

For more information about AFCIs, contact an electrical supply store, an electrician, or the manufacturer of the circuit breakers already installed in your home. Sometimes these components can be replaced with AFCIs in the existing electrical panel box.

Be sure to have a qualified electrician install AFCIs; do not attempt this work yourself. The installation involves working within electrical panel boxes that are usually electrically live, even with the main circuit breakers turned off.

If you have any doubts about the need to replace your poly pipes, take a look at the pictures of a home that suffered from a single leak. These homeowners were away on vacation when a leak developed in the upstairs bathroom. More than 27,000 gallons of water ran through their home.
When they returned, there was four feet of water in the basement and $138,000 worth of damage to their furniture, carpets, wallpaper, wallboard, ceilings and priceless family heirlooms.
Call today for information and a firsthand look at the inside of poly pipes and fittings. We offer free estimates within our standard service areas.

Welcome Home To A Poly Leak

“All of our first floor and basement ceilings caved in.”

“In some cases, homeowners are finding that homeowners insurance companies will either cancel their coverage when extensive damage is caused by [polybutylene] or refuse coverage to homes piped with PB.” —-Arizona Water Resource, the University of Arizona, November-December issue, 1994

My Grandmother’s Hutch

“Not every PB system leaks, but the material is susceptible to corrosion when it comes into contact with chlorinated water, resulting in breakage and splitting of PB piping.” —-Martin Schneider, The Baltimore Sun

My Husband’s Study

“If your house has polybutylene water pipes, you might pray for them to burst soon, because money from a class action lawsuit ruling for faulty plumbing is running out.” —-Chad Barwick, Island Packet, Hilton Head Island, June 30, 1998

Our Dining Room

“Our home was devastated”

“The pipes now are outlawed in Prince George’s and Montgomery counties and elsewhere in the country.” —-Kenneth Lelen, Washington Post, May 16, 1998

This was our heirloom dining room table.

“You could drive through a neighborhood [in San Antonio], and every street would have water running down it.” —-Henry Cisneros, Mayor of San Antonio and US Secretary of Housing and Urban Development, interviewed by Ed Bradley for 60 Minutes, December 30, 1990

This was our credenza.

“If the pipes aren’t broken, there is nothing a homeowner can do,” [Charlie Forton, codes enforcement officer for the Town of Hilton Head Island] said. “They just have to sit around and wait for it to break. It is a bad situation.” —-Charlie Forton, Hilton Head Island

Our floors and walls were buckling and waterlogged.”

“Cascading water ruptured the ceiling in several places on the main level and poured down onto [Milton and Rhonda Schultz’s] kitchen cabinets, newly decorated walls and oak floor. From there, it spilled into the living room and family room, destroying carpeting in its wake, and sloshed downstairs to the basement.” —-Kenneth Lelen, Washington Post, May 16, 1998