PCA Vs FCA In Real Estate: What’s The Difference? 

By - Chris Barnard
Last Updated - April 10th, 2024 10:59 AM
real-estate-PCA-inspection

If you own, manage, rent, or invest in commercial real estate, you already know the importance of condition assessments. Moreover, you may have got such assessments at some point in time or might be preparing for one.  

Ultimately, the only way you can ensure that your properties are up to standards is by regularly evaluating their existing condition. 

But if there’s one common confusion that almost every stakeholder has, it is about PCA and FCA reports. In fact, people even mistake a PCA real estate report and an FCA audit report as indeed the same. 

For starters, let me tell you that both PCA and FCA assessments have different scopes and purposes. 

So, what exactly are the differences between PCA vs FCA? 

Well, read on as I’ve discussed it in detail, along with my own industrial building inspector insights. 

PCA vs FCA: What are the differences? 

Now that you know both PCA and FCA are different from one another, you might well be wondering how exactly these building assessments are different. 

After all, property owners and managers use these two terms almost interchangeably. Not to mention, PCA and FCA both assess a building’s major systems to determine their standards, functionality, and maintenance requirements. 

You see, despite all the similarities, there’s a clear difference in the intent behind both these assessments. 

For instance, its the building owners or managers who mostly seek a PCA report to understand their due diligence needs.

But that’s not the case with an FCA audit which is mostly sought by potential investors who want to establish a facility’s remaining useful life. 

Also, when it comes to an FCA vs PCA report sheet, you’ll find differences in their coverage and validity, among others. 

Now, there’s more to the FCA PCA differences. And to help you understand better, I’ve explained both the assessments and their scope separately. 

So, let’s have a look. 

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What is a PCA in real estate?

First things first, PCA stands for property condition assessment and is part of the due diligence inspections for commercial real estate. 

Herein, qualified professionals like licensed engineers, contractors, and architects carry out detailed examinations of your property’s vital components as per the ASTM E2018 Standard Guide. This involves a visual assessment of the property’s structure, mechanical and electrical systems, roofing, etc., to identify and locate potential problems. 

For instance, there might be some hidden issues affecting your building’s safety, performance, or overall service life. And these are exactly what a PCA inspection will uncover. 

Also, at the end of the assessment, you’ll receive a PCA report sheet highlighting the condition of your building as well as details of required improvements. 

Who needs a PCA? 

As I said earlier, a PCA real estate inspection is part of commercial property due diligence. Meaning if you’re the owner or manager of one such property, you’ll need an assessment on a regular basis. 

In fact, you might require a PCA every time you’re about to undertake routine maintenance or repairs. 

Apart from that, PCA is also considered an essential exercise before real estate transactions. This includes property sales or leases wherein buyers, tenants, or even investors may seek an assessment report. 

Moreover, lenders might also ask for a PCA report sheet before issuing a loan or renewing one. And that’s because lenders want to finance only such properties that are safe and up to standards, making retail building condition survey a prerequisite. 

What is the scope of a PCA? 

When we talk about the differences between PCA and FCA, you’ll see the most important distinctions in the scope or coverage of both assessments. 

For instance, while an FCA audit is all about establishing the remaining longevity and essential capital investment into a property, that isn’t something that a PCA goes into. 

Instead, you can expect a property condition assessment to cover the following: 

  • Structure and foundation 
  • Basement and crawlspace
  • Roofing 
  • Walls and windows 
  • All mechanical and electrical components 
  • HVAC systems
  • Plumbing and drainage  
  • Wood decks and balconies (as per Florida balcony inspection requirements)
  • Accessibility to the parking and sidewalks (for ADA requirements)
  • Life-saving systems such (fire fighting equipment, alarm systems, etc.)
  • Exterior components, fixtures, etc.

As you can see, all these systems have to do with your building’s existing safety and overall maintenance requirements. And to that end, a PCA will help you know the nitty-gritty of the same. 

What is a PCA real estate report? 

A PCA report sheet is simply the findings of the assessment prepared by the PCA inspection professionals. And based on overall building safety and well-being priorities, this is divided into two categories, namely: 

  1. Immediate repairs table: It lists all the critical areas that need immediate maintenance or repairs, such as fire safety systems, deck or balcony safety lapses, etc. Also, it provides an estimated cost that you’ll incur to undertake this essential upkeep. 
  2. Replacement reserve table: This list is all about the long-term investments that you’ll need to make in building maintenance in order to increase its useful life. 

Wondering what’s more to a property condition assessment report? 

You can go through my blog – Real Estate Condition Report

What is an FCA in real estate? 

Now that you’re thoroughly acquainted with PCA real estate assessments let’s talk about an FCA or facility condition assessment. 

As the name suggests, an FCA audit involves an in-depth condition assessment of either one or multiple facilities at the same time. And this includes anywhere from industries to warehouses to healthcare centers to educational institutes and more. 

Not to mention, an FCA is also carried out for facilities owned by the government. 

Talking about the facility assessment itself, it involves an examination of the facility’s physical infrastructure such as major systems. 

Sounds similar to a PCA, doesn’t it? 

Well, there’s much more to FCA audits and reports. 

You see, apart from analyzing the facility’s overall physical condition, an FCA also covers its operational components. 

Furthermore, engineers conducting an FCA also evaluate the maintenance best practices being followed within the facility. This, in turn, allows them to identify the shortcomings and suggest improvements. 

Coming to the facility condition assessment template, this is different from a PCA too. That’s because unlike visual-only PCA examinations, an FCA involves a host of methods including on-site assessments, performance tests of various systems, facility’s past data analysis, and more.

Who needs an FCA? 

An FCA is primarily sought by facility owners and managers, as well as asset managers in charge of multiple facilities. 

You see, not only do FCA audit reports allow the above stakeholders to evaluate the existing condition report of their facilities, but they also help make essential investment decisions. 

For instance, from investment planning and budgeting to setting short and long-term investment goals based on priority items, an FCA can help you do it all.

Also, if you’re a buyer or investor looking to acquire or invest in a facility, an FCA audit report can also serve pre-purchase due diligence purposes. After all, FCAs are much more detailed than a PCA report sheet. 

Not to mention, FCA reports even come in handy if you’re seeking to finance or refinance your facility. 

What is the scope of an FCA audit?

While you can expect an FCA to cover all the physical condition aspects of a facility, unlike a PCA real estate analysis, it isn’t confined to that. 

So, what are the additional areas that an FCA covers? 

Here’s a complete list of items that a standard facility condition assessment looks into: 

  • Deficiencies in the facility’s systems 
  • Remaining useful life of the facility’s systems
  • Maintenance checklist items (both routine and deferred) 
  • Replacement needs, along with the estimated capital requirement 
  • Repair needs based on priority (high to low) 
  • Whether or not the facility complies with the original design and intended use
  • Current Replacement Value (CRV)
  • Facility Condition Index (FCI)

What’s more to an FCA audit? 

Well, I’ve detailed it all in my blog – Facility Condition Assessment Checklist

What is an FCA audit report? 

Like a PCA report sheet, an FCA audit report is also the most important part of the entire assessment procedure. 

In fact, FCA reports are meant for more than just data delivery; they serve as the basis for important decision-making. You can think of it as a crucial working document that helps decide everything from regular maintenance costs to big ticket capital expenses. 

Moreover, unlike a PCA report that is only prepared once and has a year-long validity, an FCA is updated on a regular basis. And that means one thing: The FCA data is always the latest and up-to-date. 

You might also want to read – What Do Building Inspectors Look For In Commercial Properties?

Wrapping up the PCA vs FCA differences

By now, it’s pretty clear how both PCA and FCA are completely different in terms of their intent, coverage, and scope. 

For instance, if you’re a property owner looking to undertake routine maintenance, a PCA report sheet could do. 

However, I can’t say the same for facility owners who, apart from maintenance, also want to plan short and long-term property upkeep expenses. That’s because you’ll need a way more thorough and current assessment like the FCA for one such expenditure planning. 

Looking to undertake one of these commercial property assessments? 

You can reach out to us and receive a free assessment cost estimate

At FCBI, we are a team of seasoned building inspectors with an experience spanning over two decades. And we’ve got all your property assessments needs covered on a budget. 

Have you read: Pros And Cons Of Triple Net Lease In Real Estate.

Chris Barnard

Hi there! I am Chris Barnard, a licensed building inspector and the founder of Florida Commercial Building Inspectors. With over two decades in the inspection industry, I’ve delivered thousands of commercial and residential inspections across various states. During all these years, I’ve developed detailed insights on the ins and outs of building inspections, something I look forward to sharing with you through my blogs.

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