Commercial Real Estate Appraisal in Alberta

1. Define the decision before ordering the report

State why the opinion is required: financing, acquisition, disposition, financial reporting, tax, litigation, expropriation, internal planning or another purpose. The same property can require a different effective date, value definition, scope and reporting level for a different decision.

Identify the interest to be appraised. Fee-simple, leased-fee, leasehold, partial interests, land, improvements and machinery or business assets are not interchangeable. Confirm whether the engagement concerns real property alone or a broader asset package.

• Purpose and authorized use
• Authorized client and users
• Property interest
• Effective date
• Value definition

2. Engage a properly qualified appraiser

Section 17.1 of Alberta's Real Estate Act restricts who may act or hold themselves out as a real estate appraiser in Alberta. Confirm the professional's current standing, commercial-property competence, geographic experience and ability to complete the specific assignment.

Ask who will inspect, research, analyze and sign the report; whether assistance will be used; what conflicts have been checked; and whether the proposed timing allows sufficient verification. A designation alone does not replace assignment-specific competence.

3. Name every intended user and use

CUSPAP distinguishes the authorized client, authorized user and authorized use. Tell the appraiser at engagement if a lender, investor, auditor, court, tax authority or other identified party must rely on the result.

A downloaded or forwarded report does not become reusable for every purpose. A later party or different use may require the appraiser's agreement, a reliance letter or a new assignment. Do not assume a report prepared for marketing can be relied on for financing, litigation or financial reporting.

4. Agree on a credible scope of work

The scope should identify the inspection, research, data verification, documents relied on, analysis and assignment limitations. CUSPAP requires the scope to be sufficient for credible results in the context of the authorized use.

Access limitations, missing leases, incomplete plans, environmental uncertainty, proposed construction or an assumed change in use can materially change the work. Surface these conditions before the engagement is accepted rather than after a draft is delivered.

5. Build the property record

Prepare current title, legal description, surveys, plans, permits, assessment and tax notices, leases and amendments, rent roll, operating history, capital history, environmental and condition reports, photographs and a schedule of included assets. Reconcile conflicting areas, dates and occupancy statements.

For income property, separate contract rent from market-rent assumptions and identify recoveries, vacancy, arrears, incentives, options, near-term rollover and non-recurring expenses. For land or redevelopment, distinguish approved rights from proposals and concepts.

• Legal and planning record
• Physical and environmental record
• Lease and income evidence
• Capital history
• Source-controlled assumptions

6. Understand the approaches selected

Depending on the property and evidence, the appraiser may use income, direct-comparison and cost approaches. The report should explain which methods were applied or omitted and how the indications were reconciled.

A capitalization rate, price per square foot or replacement-cost estimate is an input, not an appraisal by itself. The supporting income, comparable transactions, rights conveyed, physical differences, market dates and assumptions determine whether the calculation is meaningful.

7. Read assumptions and conditions before the value

Review the effective date, property interest, value definition, extraordinary assumptions, hypothetical conditions, limiting conditions and exclusions before relying on the conclusion. A value based on completed construction, stabilized occupancy or a rezoning that has not occurred describes an assumed scenario, not the property exactly as it exists.

Confirm whether the appraiser inspected the interior and exterior, which records were verified, and which facts came from the owner or another third party. Resolve material factual errors through the appraiser rather than editing or republishing the report.

8. Match the report format to the assignment

CUSPAP 2026 identifies Form, Concise and Comprehensive report formats. The shortest format is not automatically the cheapest or most appropriate once property complexity, user requirements and supporting explanation are considered.

Confirm delivery format, appendices, confidentiality, permitted distribution and whether the client needs supporting data in addition to the signed report. Keep the final report and every reliance authorization with the decision record.

9. Treat reviews and updates as separate work

An appraisal review evaluates another report under its own defined scope and may be completed with or without an opinion of value. An update, new effective date, recertification request or reliance request is not an automatic administrative extension of the original assignment.

Ask the original appraiser what new work is required when market conditions, property facts, tenancy, intended use or authorized users change. Do not overwrite the date or conclusion in an existing report.

10. Keep brokerage advice and appraisal distinct

Commercially can provide brokerage market evidence, a probable marketing range and positioning advice for a contemplated trade in real estate. Commercially does not provide an appraisal through this website, and a brokerage review should not be described or relied on as a licensed appraisal.

If the decision requires an appraisal, engage a qualified appraiser for the defined purpose. Commercially can separately help an owner or buyer connect property evidence to a sale, lease or acquisition strategy without replacing the appraiser, lawyer, accountant, lender or assessment professional.