In commercial real estate, determining a property’s true value can be complex and often depends on multiple market and asset-specific factors. The CRE landscape can be difficult to navigate—especially for investors managing diverse portfolios across industries and geographies. Whether expanding through acquisition or divesting current holdings, understanding property value is essential for making informed investment decisions.
For commercial real estate brokers, providing accurate property valuations and facilitating purchase or sale transactions are central to their advisory role. Investors rely on brokers for data-driven guidance on a property’s worth—an insight that can significantly influence deal strategy and negotiation.
Broker Price Opinions (BPOs) and Broker Opinion of Value (BOV) reports deliver the clarity investors need to evaluate opportunities and plan next steps with confidence. These reports help investors assess each asset’s potential, refine portfolio strategy, and support long-term growth.
In the following sections, we’ll explore what BPOs and BOVs are, the key components of each, and how valuation standards may vary across different states.
Key Takeaways
- A Broker Opinion of Value (BOV) is a broker-prepared estimate of a property’s worth, offering a faster and lower-cost alternative to an appraisal.
- BOVs can be tailored from brief overviews to detailed studies, depending on the investor’s goals and level of detail required.
- Investors use BOVs to support strategies such as selling, refinancing, or portfolio planning, while appraisals are required for lending and legal purposes.
- Regulations around BOVs vary by state, but most allow brokers to provide them in some form.
- While not a substitute for an appraisal, BOVs deliver practical, market-driven insights that help investors make confident, timely decisions.
What is a Broker Price Opinion in Commercial Real Estate?
A Broker Price Opinion (BPO), also known as a Broker Opinion of Value (BOV), is a professional assessment of a property’s market value prepared by a qualified commercial real estate broker. Investors and other CRE professionals use these reports to understand how much a property is worth before setting a listing price or evaluating an acquisition opportunity. Depending on the scope and investor needs, a BPO can range from a concise three-page summary to a comprehensive report exceeding 40 pages. The level of detail is typically determined by the investor’s objectives—whether they’re seeking a quick valuation snapshot or an in-depth analysis to support strategic decision-making.
The Two Types of BPOs
There are two primary types of Broker Price Opinions (BPOs) available to investors. The first is an internal BPO, which involves the broker conducting an on-site evaluation of the property’s interior. During an internal BPO, the broker measures the space, evaluates features and condition, and identifies any updates or improvements needed to maintain market competitiveness.
The second type is an external BPO, also known as a drive-by BPO, which focuses on the property’s exterior and publicly available data. While some investors prefer one type of valuation over the other, a qualified commercial real estate broker can advise which approach best aligns with your investment goals. Each type of BPO provides valuable insight into a property’s market position—helping investors make informed decisions about acquisition, pricing, or disposition strategies.
Can a Realtor Give an Opinion of Value?
When determining the value of a commercial property, investors have several approaches to consider. In many states, licensed brokers are permitted to prepare a Broker Price Opinion (BPO) or Broker Opinion of Value (BOV) to estimate a property’s market value. However, some states restrict or prohibit brokers from providing this service, reserving formal valuation authority for certified appraisers.
In most cases, though, a qualified commercial real estate broker can deliver a reliable BPO for properties you currently own or are considering for acquisition. Understanding your state’s regulations—and working with an experienced broker who adheres to them—ensures your valuation process remains compliant and credible.
What is the Difference Between an Appraisal and a Broker Price Opinion?
Both a Broker Opinion of Value (BOV) and an appraisal estimate a property’s worth, but they serve distinct purposes and are prepared through different processes. Understanding the difference is essential for investors, as selecting the right valuation method can save time, reduce costs, and ensure the appropriate level of accuracy for your situation.
- Who prepares it: A BOV is prepared by a qualified commercial real estate broker, while an appraisal must be performed by a licensed third-party appraiser.
- Standards: Appraisals follow strict regulatory frameworks and standardized valuation methods.
- BOVs, in contrast, rely on broker expertise, market data, and comparable sales analysis without formal compliance requirements.
- Cost: Appraisals generally involve higher fees, whereas BOVs are typically lower-cost and sometimes provided at no charge to clients.
- Use cases: BOVs are often used for portfolio reviews, sale pricing, refinancing, partnership buyouts, or strategic planning. Appraisals are required for lending, legal, tax, or compliance purposes.
While both offer valuable insight, the right choice depends on your investment goals and regulatory needs. Many investors use BOVs as a fast, cost-effective way to guide strategy—and turn to appraisals when a more formal, certified valuation is required. A skilled commercial broker can advise when a BOV is sufficient and when an appraisal offers a more appropriate level of due diligence.
How Does a Broker’s Price Opinion Work?
When an investor requests a Broker Opinion of Value (BOV), the objective is to obtain a clear, data-supported estimate of the property’s market worth. Depending on the investor’s purpose, BOV reports can range from a concise summary spanning only a few pages to a comprehensive analysis that covers dozens.
To prepare the opinion, a commercial real estate broker evaluates comparable sales, current market trends, and property-specific details such as:
- Age, size, and condition
- Income and expenses
- Tax and zoning information
- Comparable properties and local market data
This comprehensive review enables investors to make well-informed decisions about purchasing, selling, refinancing, or restructuring ownership.
Approaches to a Broker Opinion of Value
There are several established approaches that brokers use when preparing a Broker Opinion of Value (BOV). Some brokers may rely on a single valuation method, while others combine multiple approaches to produce a more comprehensive and well-supported estimate of a property’s market value.
Sales Comparison Approach
- This method evaluates the subject property against recent sales of comparable assets within the same geographic area and similar use.
- The sales comparison approach is widely used because it reflects current market activity and investor sentiment.
Income Approach to Value
- This approach estimates property value based on the income it produces, analyzing rental revenue, operating expenses, and capitalization rates to determine market worth.
- It is particularly effective for income-producing assets such as retail centers, office buildings, and multifamily properties.
Cost Approach
- The cost approach estimates value based on what it would cost to rebuild or replace the property at current construction prices, accounting for depreciation.
- While less commonly used in commercial real estate, it can provide useful context for unique or specialized properties where comparable data is limited.
Components of a Broker Price Opinion Report
Every Broker Price Opinion (BPO) is tailored to the investor’s objectives and the property itself, but most reports include several key components that guide decision-making. Each section of the report is designed to provide greater visibility into the property, demonstrate the broker’s valuation process, and support strategic choices around acquisition or disposition.
Common components of a BPO include:
- Location and Site Details: Address, maps, visibility, accessibility, and surrounding area insights.
- Market Overview: Employment trends, population growth, new construction, leasing activity, and recent sales.
- Property Condition: A summary of the asset’s physical state and maintenance considerations.
- Tenant and Lease Information: When applicable, details on tenants, lease structures, terms, and expiration dates.
- Comparable Listings and Sales: Analysis of similar properties currently on the market or recently sold.
- Financial Snapshot: Pro forma outlining potential income, operating expenses, and net operating income (NOI).
- Value Range: The broker’s estimated value based on current market data, comparable performance, and financial analysis.
Together, these elements create a clear and comprehensive picture of a property’s value—helping investors anticipate risks, uncover opportunities, and make confident decisions. It’s the kind of disciplined, insight-driven reporting that defines every BOV prepared by Sands Investment Group.
Benefits and Limitations of BOVs
A Broker Opinion of Value (BOV) is a powerful decision-making tool for investors, offering timely insights into a property’s market position. Like any valuation method, however, it comes with both advantages and trade-offs.
Benefits:
- BOVs are faster and more cost-effective than formal appraisals, often delivered within days rather than weeks.
- They can be tailored to provide as much—or as little—detail as the investor requires.
- Because they’re grounded in current market data, BOVs provide a practical, real-world snapshot of value.
- This makes them particularly useful for portfolio reviews, acquisition planning, and early-stage investment decisions.
Limitations:
- Since BOVs do not adhere to the same regulatory standards as certified appraisals, they may not be accepted by lenders, courts, or government agencies.
- Their precision also depends on the broker’s local expertise, access to market data, and ability to interpret comparable transactions accurately.
- For transactions requiring legal or financial verification, investors should pair a BOV with a formal appraisal to ensure full compliance.
Regulatory Considerations for BOVs
Many investors ask whether Broker Opinions of Value (BOVs) are legal. The short answer is yes—but the details depend on state-specific regulations. Rules governing BOVs vary across the country: some states limit who can prepare them, others restrict whether brokers can charge a fee, and a few require adherence to professional standards such as USPAP (Uniform Standards of Professional Appraisal Practice). While the specifics differ, most states allow licensed brokers to provide BOVs in some capacity.
In practice, both investors and lenders commonly request BOVs to support decisions around property listings, refinancing, or acquisitions. The key is partnering with a knowledgeable commercial real estate broker who understands state laws and can deliver a compliant, data-driven valuation aligned with your investment goals.
Strategic Value for Investors
The true value of a Broker Opinion of Value (BOV) lies in how it informs long-term investment strategy. A well-prepared opinion not only indicates what a property may be worth today but also clarifies how it fits within the broader portfolio vision.
- Sell confidently: Use a BOV to set realistic expectations and price an asset accurately before entering the market—helping you optimize return and reduce time to close.
- Refinance effectively: Present lenders with a current, data-supported valuation that strengthens your position and streamlines financing discussions.
- Plan your portfolio: Compare holdings across markets, identify underperforming assets, and uncover opportunities for reinvestment and growth.
At Sands Investment Group (SIG), we view every BOV as more than a valuation report—it’s a strategic decision-making tool that helps investors move forward with clarity, whether selling, refinancing, or planning the next phase of their portfolio.
Working With a Broker For CRE Property Valuation
If you’re looking for a qualified broker to prepare a Broker Opinion of Value (BOV) or Broker Price Opinion (BPO) for one of your commercial properties, the team at Sands Investment Group can help. SIG is a national commercial real estate brokerage firm specializing in helping investors acquire, sell, and optimize properties across asset classes.
Our team combines market research, data analysis, and transaction experience to deliver precise BOV reports tailored to your investment objectives. We’ve prepared valuation reports for properties across diverse industries—from retail and office to industrial and net lease—and can help you understand the current and potential value of your asset.
At Sands Investment Group, we don’t just value your property—we help you position and market it strategically when the time is right.
