How/who decides the highest and best use of a property?
So I have a property I am looking at it is at the bottom of residential condo building. 12,868 SF. The space is empty and I am looking to fill. It’s zoned for commercial use and there are some restrictions from the condo HOA on what is allowed. But i’m wondering what kind of professional do I hire to help me figure out the highest and best use of the space. An architect? Engineer? Who?
[{"id": "ihvxmyr", "text": "CRE Broker", "replies": [{"id": "ihxo867", "text": "Or appraiser if you're willing to pay for it...", "replies": [{"id": "ihyhi9r", "text": "Appraisers track comps of deals that have been made, and in my opinion, poorly.  They are historians not in any way a good representation of what a property's best use is.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ihvy140", "text": "appraiser or broker typically would consult on something like that.", "replies": [], "depth": 1}, {"id": "ihvyauh", "text": "Interesting replies. I have always determined best use myself.", "replies": [{"id": "ihvye0n", "text": "Could I PM you about how you go about it?", "replies": [{"id": "ihvyjx7", "text": "Sure", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ihvz0nn", "text": "Ultimately the market determines it, but a well trained broker or appraiser should be able to give you a credible and defensible opinion who that buyer pool is", "replies": [], "depth": 1}, {"id": "ihw1nfp", "text": "God", "replies": [], "depth": 1}, {"id": "ihw5i6f", "text": "Appraisal, market study, and/or broker opinion. \n\nYou can run a model and make the case yourself but why would anyone believe you? Not a knock on your character or knowledge. Unless you have a good reputation that precedes you, investors, etc will want to see a report by a qualified, impartial appraiser rather than go by the word of a  stranger who has a vested interest.", "replies": [], "depth": 1}, {"id": "ihwegiq", "text": "You're saying it's vacant space ready for a tenant? \nThat really narrows it.   \nBased on using the four tests of highest and best use: 1. Physically possible \u00b7 2. Legally permissible \u00b7 3. Financially feasible \u00b7 4. Maximally productive.  \n\nYou're basically limited to: tenant(s) that the space can fit, business(es) that the zoning and HOA allows, a build-out that isn't out of line with the lease rate, and the highest rent you can get in a reasonable amount of time. \n\nAdvertise the space both generally and specifically to tenants you think would be a good fit. The market will largely determine highest and best use.", "replies": [{"id": "il0yrtg", "text": "This is the right response. Ultimately the tenant/buyer decides the highest and best use. I\u2019ve been surprised before but any broker active in the market will know the range.", "replies": [], "depth": 2}], "depth": 1}, {"id": "ihwq4yj", "text": "Your choices are quadplex, gas station, or strip mall. /s", "replies": [], "depth": 1}, {"id": "ihx2n4k", "text": "Economically, the highest &amp; best use will be the permissible use that rewards the property owner with the highest net income after capital investment and ongoing expenses over a sustained period.   Achieving that can even include changing the zoning and/or persuading the HOA to amend its restrictions. So don't limit your analysis to what the grandfathered rules are. \n\n For example, there has long been a preference for retail space over all other uses because of the perceived future sales tax benefits for the city.  \n\nPost pandemic there continues to be a glut of class B and class C retail space and a shortage of housing. Thus housing, while traditionally forbidden and or discouraged in commercial zones, may be the highest and best use going forward in some special cases, even though it was throttled in the past.", "replies": [], "depth": 1}, {"id": "ihx46qr", "text": "Appraiser by following a process of https://propertymetrics.com/blog/highest-and-best-use/", "replies": [], "depth": 1}, {"id": "ihxge1n", "text": "Just got a appraiser report on land that had a high and best use definitely worth it. Wheres the property", "replies": [], "depth": 1}, {"id": "ihxmb2o", "text": "The market determines the highest and best use and the appraiser reports it. Or maybe a good broker\u2026emphasis on GOOD.", "replies": [], "depth": 1}, {"id": "ihxs4kz", "text": "An appraiser", "replies": [{"id": "ihyhajq", "text": "Appraisers document deals that have already been done.  They track history, not make it.", "replies": [{"id": "ihzz3ib", "text": "The OP isn't asking for someone to make a deal, they are asking who would tell them what the highest and best use of the space is. Why wouldn't an appraiser be the answer?", "replies": [], "depth": 3}, {"id": "ihzz6q9", "text": "Every CRE appraisal considers the highest and best use of the subject property.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "ihxuulc", "text": "I usually start by taking a look at zoning and seeing what is permitted by right.", "replies": [], "depth": 1}, {"id": "ihyhlq0", "text": "The market.  Hire a broker, pay them to do the legwork.", "replies": [], "depth": 1}, {"id": "ihznzv5", "text": "The answer to this question is what makes CRE a horserace.  No one but the user/owner of the land/space can determine what the HBU of the space will be.  A developer will look at a piece of vacant land a see a vision of what the potential is based on many factors.  Same is true of existing space in a building.  What is your vision for the space?  No one but you can tell if the space will allow you to realize that vision.  Only when you have your vision crystallized do you go to your consultants (architects, etc.) to see how your vision can be attained in/on the designated land/space...\n\njust my 2 cents...", "replies": [], "depth": 1}, {"id": "ihzx0h9", "text": "Me, I decide", "replies": [], "depth": 1}]