Building Valuation - Residential Care facility

[Rob]

I'm trying to determine the value of a 17,000 square foot residential care building in CA (95946). It has a small theater in it, 9 bathrooms, 2 master suites and the insured told me $1.5M. I told him that sounded a bit low, how did he come up with that number and he was honest and said he just guessed. I told him I'd rather not do that however I don't have any valuation tools for this type of risk. Any suggestions?

[Rlevine]

Marshall & Swift is one, Boechk's is another.(I hope I spelled it right.) A third suggestion is your carrier.

[ASTRA]

If you use ISO online services, they have a report you can order that is building value replacement cost estimator. It also uses the Marshall and Swift tool

[Bozidar]

You might try Simsol Software Web Based I2V program. You can request free valuations on their website:
http://www.simsol.com/html/web_i-2-v.html

[WildAngel]

My Opinion - STRICTLY My Opinon - Porbably at least $3,000,000. We write a few in my area. You can utilize some company web-sites to get a Building Valuation as well, depending on who you write with. I know Travelers has one and a few other companies. Marshall & Swift seems to be the company standard.

[Insismypassion]

Boeckh and Marshall & Swift merged a few years ago; one entity now.

Ask a builder what the average per square foot cost is now.

[LadyBroker]

Your best bet is to run it through Marshall/Swift, and then add 10% just to be safe. Keep in mind you want to contemplate the Building Ordinance upgrades, too, especially since this is a care facility, it has to be accessible by wheelchair and that sort of thing.

[nixonjf]

I suggest you get an estimate from Marshall & Swift / Boeckh's BVS software.
+90% of the commercial propert carriers use this as the standard.
Many agents and/or inspection companies have licenses, or if you have an ogoing need you can get your own subscription for a few hundred dollars. The software is available on the web and is easy to use.

Your other options include E2Value, ISO360(Xactware), Craftsman, Simsol, and maybe Bluebook.
But you'll get the higher acceptance from the underwriters using MSB's BVS tool.

Use "reconstruction" basis, and I think it pays to spend a few extra minutes to check the exterior wall type and add in any extra items that aren't automtically added (elevators, balconies, sprinklers, any seats/permananet equipment that goes with the "theater" you mentioned, etc.).

Once it's done, it's easy to re-run it prior to renewal - indexing is not a good strategy for maintaining values.

John Nixon
Asperta, Ltd.

[SFOInsuranceLady]

Rob,

Is this a brand new building? If so, you could use the total cost of construction as your repalcement valuation and be sure to have the policy endorsed for 4-5% inflation.

Or, if the building was recently purchased, you can use the real estate appraisal (minus the land value) as a guideline.

Marshall & Swift is OK, but I feel that their numbers tend to be on the low side (my husband and father both work in
the construction business). The facility seems to have custom features (theater, hadicapp accessability, etc..) that would warrant a current appraisal by an independent appraiser if your insured is willing to go that route.

Finally, you can ask your client if there are any contractors/engineers/architects that sit on the board that would be willing to help figure out a decent replacement cost for free. I've gone this route many times I have 3-4 residential care facilities that I work with.

Good Luck!