Category: Due Diligence

How to Turn Your PCA Reserve Table into a Capital Planning Roadmap

Posted on by Chelsea Clifton

A Property Condition Assessment (PCA) is more than a report; it’s a roadmap for maximizing your asset’s long-term performance. The reserve table included in a PCA provides critical insights into future capital needs, helping owners, investors, and lenders make informed decisions about budgeting, risk management, and portfolio strategy. By learning how to interpret and apply this data, stakeholders can move beyond compliance and leverage their PCA to unlock lasting value across real estate markets nationwide.

Why the PCA Reserve Table Matters

When a PCA is completed, the reserve table often becomes the most actionable part of the report. It outlines projected repair and replacement costs over the property’s lifecycle, offering a timeline of when and how funds should be allocated. Instead of viewing this as a static requirement for financing or compliance, owners and investors should treat it as a strategic asset management tool.

A well-analyzed reserve table helps you:

· Plan capital expenditures with accuracy.

· Reduce the risk of unexpected costs.

· Improve lender and investor confidence.

· Extend the useful life of building systems.

Turning Data Into Actionable Strategy

The value of the PCA reserve table lies in applying it to day-to-day and long-term decision-making. By aligning your capital planning with the forecasted schedule, you create a proactive management program that stabilizes operations and enhances asset value.

Steps to Maximize the Reserve Table:

1. Prioritize Critical Repairs Address health, safety, and structural concerns first to mitigate risk.

2. Forecast Cash Flow Needs Use the reserve table to align expenditures with anticipated revenue streams, ensuring balanced budgets.

3. Leverage for Negotiations Buyers and lenders can use the data to negotiate fair purchase prices or financing terms.

4. Benchmark Across Portfolios Investors with multiple properties can compare reserve data to prioritize investments and assess portfolio-wide performance.

5. Plan for Lifecycle & Modernization

Conduct annual system health checks and update timing, scope, and costs in the reserve (change outs, upgrades), rolling it forward each year for planning.

Nationwide Impact of PCA Reserve Planning

Across the U.S., real estate markets vary dramatically in construction costs, regulatory standards, and climate-driven maintenance needs. A PCA reserve table accounts for these differences, giving property stakeholders location-specific insights while maintaining a standardized nationwide framework. Whether in Dallas, New York, or Los Angeles, the same principles apply: data from a PCA should drive smarter financial and operational decisions.

The Moran Consultants Advantage

With over 50 years of national experience, Moran Consultants specializes in delivering comprehensive PCA services that go beyond check-the-box reporting. Our team of in-house experts provides actionable reserve tables designed to give owners, syndicators, lenders, and investors confidence in their long-term asset planning. We help transform your PCA into a forward-looking tool for stability and growth.

Frequently Asked Questions

What is a PCA reserve table?

A reserve table is a financial forecast included in a Property Condition Assessment (PCA). It outlines anticipated repair and replacement costs for building systems and components over time.

Why is the PCA reserve table important for owners and investors?

It allows stakeholders to proactively plan capital expenditures, avoid unexpected costs, and extend the life of property assets.

Can a PCA reserve table impact financing or negotiations?

Yes. Lenders and buyers often rely on PCA reserve tables to evaluate property risks, set financing terms, or negotiate purchase prices.

How often should a PCA be updated?

Industry best practice is to update the PCA a minimum of every 3–5 years, or when major property upgrades or acquisitions occur, to keep the reserve table accurate.

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What is an Environmental Transaction Screen (ETS)?

Posted on by Chelsea Clifton

Environmental due diligence is a critical part of any real estate transaction. Whether you’re purchasing, financing, or redeveloping a property, understanding environmental risk is key to protecting your investment.

In many cases, a full Phase I Environmental Site Assessment (ESA) is the standard choice. It’s thorough, compliant with the All Appropriate Inquiries (AAI) rule, and offers liability protection under CERCLA. However, there are situations where that level of investigation is not necessary. For lower-risk properties, a faster and more cost-effective option exists: the Environmental Transaction Screen (ETS).

What Is an Environmental Transaction Screen (ETS)?

An Environmental Transaction Screen (ETS), developed under ASTM E1528, is a streamlined due diligence tool intended for low-risk property transactions. While it does not provide legal liability protection, it can identify readily observable or known environmental concerns, offering valuable insights without the cost and time required for a Phase I ESA.

The ETS is particularly well-suited for situations where:

  • Contamination is unlikely
  • Time and budget constraints are a factor
  • The goal is to make early, informed decisions

 

How the ETS Process Works

At Moran Consultants, our ETS process is designed to meet ASTM E1528 requirements while staying focused and efficient:

  • Visual Inspection – A qualified environmental professional or trained personnel visits the site to identify any observable signs of concern.
  • Transaction Screen Questionnaire – Completed according to ASTM standards, combining site observations with available documentation and user-provided knowledge.
  • Limited Records Review – Includes one historical source (such as an aerial photograph or Sanborn map) and basic environmental database summaries, if accessible.
  • Professional Opinion – An expert conclusion on whether findings warrant additional investigation or escalation to a Phase I ESA.

 

When to Use an ETS

An ETS can be the right choice when:

  • The property has a low-risk use history (residential, office, or undeveloped land)
  • There is no known history of hazardous materials use or releases
  • CERCLA liability protection is not required
  • You need a quick preliminary screening before committing to a deal
  • The review is for internal purposes without lender or investor requirements

By focusing only on the most relevant factors for low-risk sites, an ETS can help you make timely, confident decisions without unnecessary expense.

 

When an ETS May Not Be Enough

An ETS is not appropriate in every situation. Properties with an industrial or high-risk history, known environmental concerns, or transactions requiring CERCLA liability protection should undergo a full Phase I ESA. Lenders or investors may also require the broader scope and compliance offered by a Phase I ESA.

In these cases, the Phase I ESA’s comprehensive review, covering regulatory records, multiple historical sources, and a detailed site investigation, provides the necessary level of assurance.

 

Why Work with Moran Consultants

With decades of experience providing environmental due diligence nationwide, Moran Consultants can guide you in selecting the right assessment for your project. If an ETS reveals concerns, we can seamlessly transition into a Phase I ESA to further evaluate and address potential risks. Our in-house professionals ensure each step is handled efficiently, accurately, and in line with industry standards.

The Environmental Transaction Screen (ETS) is a practical, cost-effective option for evaluating environmental risk in low-risk property transactions. While it doesn’t replace the legal protections of a Phase I ESA, it offers valuable insight to support early decision-making.

If you’re unsure whether an ETS or a Phase I ESA is right for your property, Moran Consultants can help you determine the best approach—keeping your project on track and your investment protected.

Which Environmental Assessment Should I Choose?

Posted on by Chelsea Clifton

When it comes to real estate transactions, environmental due diligence is essential for identifying potential environmental risks and protecting your investment. The right assessment can uncover contamination, historical land uses, and regulatory issues that might affect property value, compliance, and liability.

Three of the most common tools used in environmental due diligence are the Phase I Environmental Site Assessment (ESA), the Environmental Transaction Screen (ETS), and the Desktop Environmental Review. While they share the same goal, assessing environmental risk, their scope, cost, and legal implications vary significantly.

Here’s how to understand the differences and choose the right approach for your project.

What Is a Phase I Environmental Site Assessment (ESA)?

The Phase I ESA is the industry standard for comprehensive environmental due diligence. Conducted in accordance with ASTM E1527 and the All Appropriate Inquiries (AAI) rule, it provides liability protection under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

A Phase I ESA involves:

  • A physical inspection of the property and surrounding area
  • A review of regulatory databases for environmental listings
  • Research of multiple historical sources such as aerial photographs, Sanborn fire insurance maps, and city directories
  • Interviews with current and past property owners, occupants, and local officials
  • A written report identifying Recognized Environmental Conditions (RECs) and recommendations for next steps

Best For:

Transactions requiring AAI compliance, properties with moderate to high-risk histories, lender or investor requirements, and situations where legal liability protection is needed.

What Is an Environmental Transaction Screen (ETS)?

An Environmental Transaction Screen (ETS), developed under ASTM E1528, is a streamlined version of a Phase I ESA. It is designed for low-risk property transactions where contamination is unlikely and CERCLA liability protection is not required.

The ETS includes:

  • A site inspection by a qualified environmental professional or trained personnel
  • An ASTM-compliant Transaction Screen Questionnaire covering property history, current use, and potential concerns
  • A limited review of one historical source (e.g., aerial photo or Sanborn map) and basic environmental database summaries, if available
  • A professional opinion on whether further investigation, such as a Phase I ESA, may be warranted

Best For:

Low-risk properties (e.g., residential, office, undeveloped land), early-stage due diligence, and internal reviews without lender or investor mandates for a Phase I ESA.

What Is a Desktop Environmental Review?

A Desktop Environmental Review is the fastest and most cost-effective environmental due diligence option. Unlike a Phase I ESA or ETS, it does not include a physical site visit and is not ASTM or AAI compliant. Instead, it relies solely on research and document review to identify potential environmental concerns.

There are two primary levels:

  1. Regulatory Desktop Review – Focuses on federal, state, and local regulatory databases to identify environmental listings for the subject property and surrounding area.
  2. Regulatory + Historical Desktop Review – Combines regulatory data with limited historical research, such as aerial photographs or fire insurance maps, to evaluate past land uses.

Best For:

Quick red-flag screenings, projects with time or access limitations, and early feasibility or underwriting reviews for low-risk sites.

How to Choose the Right Option

Selecting the right environmental due diligence tool depends on:

  • Risk Profile – Industrial or complex sites typically require a Phase I ESA; low-risk sites may be fine with an ETS or Desktop Review.
  • Transaction Requirements – Lender, investor, or regulatory mandates often dictate the scope.
  • Timeline and Budget – Desktop Reviews are fastest and least expensive; Phase I ESAs take longer and cost more.
  • Intended Use of Findings – If you need legal liability protection, a Phase I ESA is the only option that meets AAI standards.

Example Scenarios:

  • Redeveloping a former manufacturing facility → Phase I ESA
  • Purchasing a small office building without lender requirements → ETS
  • Evaluating vacant residential land for early feasibility → Desktop Review

The Moran Consultants Advantage

At Moran Consultants, we provide all three types of environmental due diligence nationwide. Our in-house environmental professionals help clients select the most appropriate scope based on project risk, requirements, and goals. If concerns arise during a Desktop Review or ETS, we can quickly transition to a Phase I ESA, keeping your project on track and ensuring risks are addressed before closing.

Whether you choose a Phase I ESA, Environmental Transaction Screen (ETS), or Desktop Environmental Review, the key is matching the scope to the property’s risk profile and your project’s requirements. Each tool serves a different purpose in environmental due diligence, and choosing wisely can save time, money, and avoid unexpected liabilities.

Contact Moran Consultants today to discuss which approach best fits your property and transaction needs.

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Aligning CNAs with Tax Credit Programs: What Lenders and Developers Need to Know

Posted on by Chelsea Clifton

In the world of affordable housing finance, accuracy and alignment are everything. That’s especially true when it comes to Capital Needs Assessments (CNAs), a critical component of due diligence that evaluates a property’s physical condition and projects repair and replacement needs over time. But not all CNAs are created equal. When tax credit programs, such as LIHTC or USDA-RD, are in play, the CNA must be tailored to meet program-specific requirements. An off-the-shelf report won’t cut it. For developers, syndicators, and lenders, a misaligned CNA can lead to delays, added costs, or even disqualification from funding opportunities.

At Moran Consultants, we specialize in helping clients avoid those risks by aligning each CNA with the exact standards required by the financing program. Here’s what you need to know.

 

Understanding Program-Specific CNA Requirements

Each housing program has its standards for how CNAs should be formatted, what data they must include, and how they tie into the broader financing package.

LIHTC (Low-Income Housing Tax Credit)

For LIHTC projects, CNAs must typically address:

  • A 15-year projection of capital needs.
  • Immediate repairs and life-safety issues upfront.
  • A reserve schedule that informs and updates the property’s pro forma.
  • Narrative discussion of observed conditions and long-term strategies.

State Housing Finance Agencies (HFAs) often layer their Qualified Allocation Plan (QAP) requirements onto these expectations, making familiarity with regional standards critical.

USDA-RD (Rural Development)

USDA Rural Development properties, often older assets in underserved market, require:

  • A long-term focus on livability, health and safety, and code compliance.
  • Detailed cost estimates and life-cycle projections.
  • Consideration of energy and accessibility upgrades, where applicable

 

What Happens When CNA Requirements Aren’t Met?

When a CNA doesn’t align with its target program, it can create serious complications:

  • Submission delays due to formatting issues or incomplete data.
  • Rework costs from having to revise or redo the assessment.
  • Application setbacks that slow funding and project timelines.
  • Regulatory risks down the line if reserve levels or repair strategies were based on faulty assumptions.

 

Best Practices for CNA Alignment

To keep your project on track, the CNA should be built with program requirements in mind from day one. Here are a few ways to ensure that:

  • Engage stakeholders early. Talk to lenders, syndicators, and agencies before finalizing your scope.
  • Use qualified consultants. Choose a team that understands LIHTC requirements, QAP nuances, and USDA-RD necessities.
  • Cross-reference with the pro forma. Ensure the reserve schedule, rehab scope, and operating assumptions are coordinated.
  • Account for inflation and phasing. Build flexibility into your cost estimates to reflect future-year conditions.

 

How Moran Consultants’ CNAs Can Help

At Moran Consultants, we bring deep expertise in aligning CNAs with tax credit financing structures across the country. Our due diligence team is experienced in:

  • Preparing agency-ready CNAs for LIHTC deals.
  • Navigating state-specific QAP requirements and federal submission portals.
  • Identifying red flags early before they become funding obstacles.
  • Delivering fast, comprehensive reports that satisfy lenders and regulators alike.

In affordable housing, precision matters. A well-aligned CNA is more than a checkbox, it’s a foundation for financing, long-term planning, and regulatory compliance. By partnering with consultants who understand the nuances of tax credit programs, you can avoid costly delays and move your project forward with confidence.

Why the Phase I ESA Is Essential for Affordable Housing Projects

Posted on by Chelsea Clifton

Affordable housing is one of the most impactful ways to strengthen communities and create long-term opportunities. Building these developments takes more than great design and funding. It requires thoughtful planning and early due diligence to help ensure everything stays on track.

One of the most important tools in that planning process is the Phase I Environmental Site Assessment, or Phase I ESA. At Moran Consultants, we support developers, syndicators, and lenders with complete, clear, reliable environmental assessments that meet funding requirements and support long-term project success. Whether your site is brand new or part of a redevelopment, the Phase I ESA provides critical insights that help you move forward with confidence and protection.

What Is a Phase I ESA?

A Phase I ESA is a standardized report that evaluates a property for potential environmental concerns. It follows guidelines set by ASTM International (ASTM E1527-21) and is often required before a site is purchased, financed, or developed, especially when public or agency funding is involved.

This assessment involves several steps:

• Reviewing historical land use

• Evaluating environmental databases

• Conducting a visual site inspection

• Speaking with people familiar with the property’s history

The goal is to identify what’s called a Recognized Environmental Condition (REC), which is any evidence that contamination may be present and further review might be required.

Importantly, a Phase I ESA does not include soil or groundwater sampling. Instead, it is building a full environmental profile of the site’s past and present to help guide smart decisions about its future.

Why It Matters for Affordable Housing

Affordable housing projects often rely on funding from programs like the Low-Income Housing Tax Credit (LIHTC) program, or other state and local initiatives. Many of these programs require a Phase I ESA as part of their application or closing process.

Even when it’s not required, this early environmental check can save time and money. Many affordable housing sites are built in urban or redeveloped areas that might have had past uses like gas stations, industrial buildings, or dry cleaners. Knowing the history helps avoid surprises and gives development teams a chance to plan.

A Phase I ESA also provides peace of mind. If something does need further investigation, it’s caught early enough to address it without derailing the entire project schedule.

Added Benefit: Legal Liability Protection

One of the biggest but least understood benefits of a Phase I ESA is that it can help protect you legally.

If you’re buying a property and later discover contamination, federal law could hold you responsible even if you didn’t cause it. But if you’ve conducted a Phase I ESA that meets the EPA’s “All Appropriate Inquiries” (AAI) standard, you may qualify for liability protection under federal law (CERCLA, or the Superfund law).

This is a major reason why lenders, syndicators, and institutional investors require it. It doesn’t just help evaluate a site; it helps protect everyone involved.

Not All Sites Are the Same

Each property is unique. Some may have a long history of residential use, while others may have once housed businesses that left environmental footprints behind. A Phase I ESA simply helps identify whether anything needs a closer look.

At Moran Consultants, we help clients evaluate a wide range of sites. In many cases, we confirm there are no concerns, and the project can move ahead without delay. In other cases, our findings give teams time to take the next step, whether it’s a focused follow-up investigation or a plan to address potential risks.

How Moran Consultants Supports You

Our team brings decades of experience in environmental assessments and a deep understanding of how affordable housing projects work, from funding and design to permitting and close-out. We tailor our Phase I ESAs to meet the exact needs of your project and the requirements of your partners.

We’re known for:

• Clear, easy-to-understand reports

• Fast turnaround times

• Familiarity with LIHTC, HUD, and state-specific funding programs

• Practical, collaborative support from start to finish

We work nationwide and understand regional requirements, so you can count on compliance with both local and federal standards.

Building With Confidence

Affordable housing is about creating stability for residents, neighborhoods, and the teams that make it possible. A Phase I ESA is a critical step that helps protect your investment, strengthen your application, and support smart, sustainable development.

Let’s build something that lasts with confidence and clarity from the ground up.

Why a 15-Year PNA Is a Smart (and Timely) Move for Your Property

Posted on by Chelsea Clifton

In affordable and multifamily housing, long-term planning isn’t optional — it’s essential. A 15-Year Property Needs Assessment (PNA) is more than a report. It’s a roadmap that helps you protect your investment, prepare for funding or refinancing, and make smart, confident decisions about what comes next.

At Moran Consultants, we’ve been supporting clients across the country with thoughtful, strategic PNAs for decades. Whether you’re managing your first 15-year cycle or gearing up for your second, our goal is to make the process clear, helpful, and build around your priorities.

What Is a 15-Year PNA?

A Property Needs Assessment reviews your property’s current physical condition and projects future capital needs over the next 15 years. This tool is commonly required for:

• Affordable housing with Low-Income Housing Tax Credit (LIHTC)
• Initial financing and syndication
• Refinancing, resyndication, or recapitalization
• Strategic asset management and long-term planning

A well-prepared PNA helps you understand what repairs or replacements are likely and when, so you can set budgets, build reserves, and avoid surprises.

What’s Included in a 15-Year PNA?

A Comprehensive On-Site Inspection
Our assessors visit the property and examine all major systems including roofs, HVAC, plumbing, electrical, interiors, common areas, and site features. We identify what’s in good shape, what needs attention now, and what may need replacement down the road.

A 15-Year Capital Needs Schedule
This detailed, year-by-year schedule outlines anticipated repair and replacement costs. It is based on industry-standard useful lives, adjusted for the observed remaining useful life of each system and local cost trends. It provides a clear, data-backed plan to fund your reserves and address capital needs proactively.

Code and Accessibility Observations
We include a review of life-safety and accessibility elements, identifying any areas that may not meet current standards. If updates are recommended, we present them in a clear and practical way so you can stay compliant and ahead of potential issues.

A Clear Narrative Summary
Every PNA includes a narrative that highlights key findings and recommendations, helping you quickly understand where the priorities are. We speak your language, so that property owners, asset managers, and development partners all walk away with clarity.

Why 15 Years? Why Now?

Fifteen years aligns with most funding programs, reserve planning periods, and compliance windows. If your last assessment was done 12 to 15 years ago, you’re likely entering a critical stage where major systems originally forecasted for replacement are now due or overdue.

A new PNA gives you the insight needed to:

• Replace or extend big-ticket systems strategically
• Realign reserve schedules and funding plans
• Support new funding or repositioning efforts
• Meet agency, lender, and investor requirements
• Preserve property value and resident satisfaction

Plan with Confidence. Plan Like a Pro.

A 15-Year Property Needs Assessment isn’t just a requirement. It’s an opportunity. With the right insights, you can plan ahead, protect your investment, and keep your property in strong shape for years to come.

At Moran Consultants, we’re here to guide you every step of the way. From inspections to final reporting, our team makes the process straightforward and aligns with your goals so you can plan like a pro and build around your goals.

Contact us or give us a call at 866-545-3350 to learn more!

Urban Evolution: The Adaptive Reuse Boom in Eastern Cities

Posted on by Chelsea Clifton

Why Adaptive Reuse is Gaining Momentum

Across bustling metropolitan hubs from Massachusetts to Florida, a powerful construction trend is quietly transforming skylines, neighborhoods, and local economies: adaptive reuse. What was once a niche strategy has become a mainstream solution for sustainable urban growth, breathing new life into old, dilapidated buildings. This trend has become especially prominent throughout the Eastern U.S., where dense urban cores and rich industrial histories provide fertile ground for these creative transformations.

The resurgence of adaptive reuse is not accidental; a convergence of sustainability goals, community revitalization efforts, and strong financial incentives drives it. A key advantage of adaptive reuse is its potential to reduce costs. By utilizing existing structures and materials, developers can lower spending on both materials and labor. Research shows that adaptive reuse projects can achieve construction cost savings of approximately 20–30% compared to building new structures.

Beyond cost savings, adaptive reuse often revitalizes entire neighborhoods, attracting new residents and businesses, increasing local tax revenues, and preserving the architectural character that makes historic districts so unique. Cities like Philadelphia, Baltimore, Boston, Atlanta, and Richmond are leading the charge, supported by programs such as Historic Tax Credits (HTC), New Markets Tax Credits (NMTC), and Commercial Property Assessed Clean Energy (C-PACE) financing.

Navigating the Challenges

Despite its clear advantages, adaptive reuse is not without hurdles. Developers and investors often face unique challenges not found in ground-up construction. Aging structural components, deteriorated masonry, hazardous materials like asbestos or lead paint, and outdated mechanical systems can introduce unexpected costs and delays. Compliance with modern energy codes and accessibility standards can further complicate planning and execution.

Without proper oversight, these risks can threaten project budgets, timelines, and financing arrangements, turning a promising redevelopment into an expensive lesson in what can go wrong.

How Moran Consultants Supports Adaptive Reuse

This is where Moran Consultants plays a critical role. Whether you’re an owner needing owner’s representation, a lender seeking reliable construction monitoring, or a stakeholder requiring a PCA or an asbestos survey, we help ensure that adaptive reuse continues to be a practical, profitable, and powerful tool.

Interested in learning more about how we support adaptive reuse projects? Contact us today or give us a call at 866-545-3350 to discuss how Moran Consultants can help you navigate risk and deliver value on your next redevelopment venture.

Planning Ahead: The Value of a Stabilized Property Inspection

Posted on by Chelsea Clifton

Importance of a Stabilized Property Inspection

Owning a fully leased, income-producing property is a major milestone. Once an asset is stabilized, performing well, and generating consistent returns, owners often shift their focus toward strategic decisions like refinancing, selling, or reinvesting in the property. A Stabilized Property Inspection is a valuable tool in this process, offering clarity, confidence, and a clear roadmap for what comes next.

At Moran Consultants, we work with clients across the country to help them make informed, forward-thinking decisions about their real estate assets. Our stabilized inspections go beyond basic observations to provide real insight into the long-term performance and capital needs of an asset.

Understanding Stabilized Property Inspections

Unlike inspections conducted during acquisition or construction, a stabilized property inspection focuses on the condition of a fully operational property. It provides a detailed evaluation of major systems, deferred maintenance, and anticipated capital expenditures. From the building envelope and structural components to mechanical, electrical, and plumbing systems, the goal is to assess how the property is aging and where future capital expenditures may be required.

These inspections are not only about identifying current deficiencies, but also about understanding how a property will perform over time and making sure the path ahead is a strong one.

When Stabilized Property Inspections Apply

Stabilized Property Inspections are most applicable when a property has achieved occupancy and income stabilization. These inspections are often timed prior to refinancing, recapitalization, partnership restructuring, or as part of annual portfolio assessments. They can also be valuable when planning future capital improvements, preparing for investor reporting, or used on a recurring basis as a proactive check-in on asset conditions and performance.

Manage Your Asset

Many clients who engage Moran for stabilized inspections are looking for more than just a report. They’re looking for a partner who understands the broader goals of their portfolio. We bring decades of construction and engineering experience to every assignment, along with a clear understanding of what matters to lenders, investors, and long-term owners.

Our reports are structured to deliver more than just findings. They offer thoughtful analysis and clear recommendations that help you make decisions with confidence. Whether your next move is to refinance, reposition, or simply maintain a high-performing asset, we’re here to help you see the full picture.

Contact Moran Consultants

A stabilized property inspection is not just about checking a box. It’s about building momentum and ensuring that your next move, whatever it may be, is backed by insight and experience. If you’re ready to take a proactive approach to your asset’s future, let’s talk. Moran Consultants is here to support your success, every step of the way. Contact us online or give us a call at 866-545-3350 to learn more.

 

Endangered Species, Delayed Projects: How Moran Consultants Helps Navigate Compliance Risks

Posted on by Chelsea Clifton

When it comes to planning and developing a new project in Florida, one of the most easily overlooked—but potentially project-halting—issues is the presence of endangered wildlife. Two protected species in particular, the Gopher Tortoise and the Eastern Indigo Snake, are frequently found on undeveloped or partially disturbed land throughout the Southeast. Their discovery on a job site can introduce unexpected layers of regulatory complexity, permit delays, and even construction shutdowns.

These animals aren’t just protected because of their rarity. The Gopher Tortoise is considered a keystone species, supporting an entire ecosystem through its burrowing behavior. The Eastern Indigo Snake, a federally threatened species, often takes refuge in these burrows. Because of their environmental importance, both species are closely monitored by state and federal agencies, and disturbing them—intentionally or unintentionally—can come with serious consequences.

For developers and project stakeholders, this translates to risk: timelines can be extended by months, relocation permits may be required, and oversight by agencies like the Florida Fish and Wildlife Conservation Commission (FWC) and the U.S. Fish and Wildlife Service (USFWS) becomes unavoidable.

That’s where Moran Consultants comes in.

Phase I ESA

Our Due Diligence team specializes in identifying potential environmental risks before they become costly obstacles. By conducting a Phase I Environmental Site Assessment early in the acquisition or pre-construction process, we can help determine whether your site may contain suitable habitat for endangered species, well before crews or equipment arrive.

Construction Loan Monitoring

Working with a regional-specific consultant from Moran Consultants ensures that lenders, syndicators, and investors are supported by professionals who understand the unique environmental challenges in each market. Our consultants are familiar with common risks, enabling them to provide timely insights and strategic guidance from day one. That level of foresight can be the difference between staying on schedule or facing costly delays.

Don’t let an endangered species bring your project to a standstill. Contact us online of give us a call at 866-545-3350 to learn how our team can help you stay ahead of environmental compliance and keep your timeline intact.

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Freddie Mac’s Updated Property Condition Report Requirements

Posted on by Chelsea Clifton

On December 12, 2024, Freddie Mac released updates to Chapter 62 of its Multifamily Seller/Servicer Guide, enhancing Property Condition Reports (PCRs) to better address safety, compliance, and operational integrity in multifamily properties. These changes clearly define repair categories, reinforce accessibility and fair housing standards, and refine reporting practices. Below, we explore the purpose of PCRs and highlight the key updates.

Purpose of Property Condition Reports

Property Condition Reports (PCRs) are vital for Freddie Mac’s multifamily lending, providing a thorough assessment of a property’s physical state and compliance with regulatory standards. Core elements of PCRs include:

  1. Detailed Evaluations: Analysis of essential systems like roofs, HVAC, plumbing, and electrical to ensure structural integrity and functionality.
  2. Repair Classifications: Identifying Critical Repairs (urgent safety and structural issues) and Priority Repairs (to be addressed within 90-365 days), while Routine Maintenance under $3,000 is managed by the borrower.
  3. Accessibility Compliance: Emphasis on ADA and FHA standards, with recommended upgrades to enhance accessibility.
  4. Capital Needs Forecasting: Planning for future repairs and replacements, preserving property value over the loan term.

These comprehensive assessments allow Freddie Mac to confidently issue Letters of Commitment or accept rate-lock applications while ensuring that multifamily properties meet strict quality and safety standards.

Key Updates in December 2024

  1. Streamlined Repair Categories
    • Operational Repairs Removed: The Operational Repair category has been eliminated, simplifying repair classifications.
    • Critical Repairs: Immediate risks to safety, structural integrity, or habitability must be resolved before closing.
    • Priority Repairs: Deficiencies requiring action within 90 days (PR-90 Repairs) or 365 days to prevent further deterioration.
    • Routine Maintenance: Items under $3,000 per repair are considered part of standard property upkeep and no longer classified unless neglect causes escalation.
  2. Enhanced Accessibility Compliance
    • Strengthened emphasis on ADA and FHA compliance, requiring consultants to document non-compliance and recommend achievable upgrades for older properties.
    • Accessibility-related deficiencies must align with federal standards to improve equity for tenants with disabilities.
  3. Form 1105 Refinements
    • Standardized Reporting: Continues to ensure consistent summaries, repair breakdowns, and capital needs projections over the loan term.
    • Enhanced alignment of repair classifications and cost estimates to clearly define evaluations.

Why These Updates Matter

Freddie Mac’s December 2024 updates reflect a commitment to maintaining the highest standards for multifamily property evaluations. Key benefits include:

  1. Proactive Risk Management: Freddie Mac’s emphasis on addressing Critical Repairs before closing and Priority Repairs within 90-365 days directly supports proactive risk management. This ensures immediate safety risks and potential future issues are handled promptly, reducing the chance of long-term liabilities.
  2. Improved Accessibility and Fair Housing: The stronger focus on ADA and FHA compliance reflects Freddie Mac’s efforts to ensure properties are inclusive and accessible. Requiring consultants to document non-compliance and recommend achievable upgrades aligns with improving equity for tenants and reducing legal risks.
  3. Enhanced Transparency: The refinements to Form 1105 and the streamlined repair classification system provide clearer, more standardized reporting. This ensures consistency across assessments, making it easier for stakeholders (borrowers, Seller/Servicers, consultants, and Freddie Mac itself) to understand property conditions and necessary actions.
  4. Preservation of Property Value: By requiring detailed inspections of building systems, capital needs projections, and actionable repair timelines, Freddie Mac is ensuring that properties remain functional and marketable throughout the loan term. This focus on addressing critical and priority issues safeguards long-term asset value.

Freddie Mac’s refined PCR requirements promote safer, more accessible multifamily properties while mitigating risks for lenders and borrowers alike. By streamlining repair categories, enhancing accessibility standards, and clarifying Routine Maintenance responsibilities, these updates reinforce Freddie Mac’s dedication to excellence in property evaluations.

How Moran Consultants Can Help

Navigating these updated requirements can be complex, but Moran Consultants is here to help. Our due diligence services ensure that your property condition reports meet Freddie Mac’s new standards, providing you with clear insights and proactive solutions. Whether you need a thorough compliance review, capital planning, or guidance on accessibility upgrades, our expert team is ready to assist. Give us a call today to learn how we can support your next project.

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