Equipment Appraisal Blog | Understanding Machinery Appraisals

Solar energy has evolved over the past few decades from being a popular trend to becoming a very smart business decision for commercial property owners. Installing solar panels is a powerful way to reduce energy costs, increase property value, and demonstrate a commitment to sustainability. Another significant benefit to these installations is the availability of federal and state tax credits. With continued technological improvements driving improved efficiencies and reduced costs, going solar has never been more financially rewarding.

Financial Benefits

Solar installations can significantly cut energy expenses by offsetting reliance on the grid. Over time, the savings from reduced electricity bills can more than cover the initial investment in solar panels. Additionally, many states offer net metering programs, which allow businesses to sell excess energy back to the grid, generating an additional revenue stream.

Tax Incentives

The federal government provides an Investment Tax Credit, commonly referred to as ITC, which allows commercial property owners to deduct a significant percentage of the cost of solar installations from their federal taxes. Currently, the ITC covers 30% of the installation costs for eligible projects, materially reducing the upfront cost.

Certain states and local governments may offer additional incentives, including property tax exemptions, grants, and low-interest financing. Combined with the federal ITC, these programs can make solar installations an incredibly attractive investment.

Enhanced Property Value

A solar-powered commercial property is more appealing to tenants and buyers alike. Lower operational costs and a focus on sustainability can make your property stand out in a competitive market. Solar installations also reflect positively on your business’s environmental commitment, which can resonate with eco-conscious tenants and customers.

In summary, the clock may be ticking on some of these incentives, as tax credit rates are always subject to change in future years. So, if you are considering solar installation for a commercial property, acting sooner rather than later is a good idea. Be sure to consult with the installation experts in the field and your accountant for a detailed analysis. Investing in solar energy is great not just for the environment but also for your bottom line.

For an equipment appraiser, building a solid relationship with their clients is one of the most critical components to completing a valuation assignment. Appraisals are much more than a simple engagement between two parties. It is the beginning of a partnership based on trust, communication, experience, and expertise. Whether valuing machinery for a potential acquisition, financing/leasing arrangement, litigation support, donation, property tax appeal, insurance claim, or basic sale, a strong appraiser-client relationship is essential for achieving accurate, credible results.

Here are some of the key elements to establish in the relationship:

• Clear and Consistent Communication

  Transparency is critical. From the initial consultation, appraisers should clarify the scope of work, timelines, and any specific needs. Clients, in turn, should provide detailed information about the equipment and any supporting documentation. Regular follow-ups by the appraiser with progress updates are important to put in place from the start.

• Trust and Confidentiality

  Equipment appraisals and their associated transactions often involve sensitive financial or business details. A professional appraiser upholds confidentiality, ensuring the client’s data remains secure. Building trust through an ethical practice fosters a long-term partnership.

• Understanding the Larger Transactional Perspective and Client Goals

  Regardless of the purpose and need for an equipment valuation, appraisers should strive to fully understand the client’s objectives so they can better clarify and provide insights that align with the intended use of the report based on their experience with similar assignments.

• Ongoing Collaboration

  Client-appraiser relationships shouldn’t end with the delivery of the final report. Appraisers can provide ongoing support and consultation as the client’s situation or deal continues to develop. The comfort level an appraisal client gains over time will lead to future opportunities. They can benefit from having a trusted expert in their corner for years to come.

In summary, establishing and maintaining a relationship between an equipment appraiser and their client ensures smoother transactions, fewer misunderstandings, and more supportable results. Clients will gain lasting trust in their valuation experts, and appraisers, in turn, can count on their clients to disclose the information necessary to create relevant, reliable reports and future engagement opportunities. Taking the time to develop this type of professional partnership builds a foundation for success and becomes a win-win situation for both parties.