Explanations

The gross multiplier method, also known as the gross rent multiplier (GRM) method, is an appraisal technique specifically designed to estimate the value of income-producing properties based on their rental income .

Public buildings, such as city halls, churches, or schools, are service-oriented and generally do not generate rental income. Since the gross multiplier method relies entirely on a property’s gross rental income for its calculation, it would be of little to no value for appraising properties that do not produce rental income. For such properties, other appraisal methods like the Cost Approach are more appropriate.

Commercial properties, residential properties (which can be rented out), and apartment buildings are all types of properties that are typically purchased or held for the purpose of generating rental income. Therefore, the gross multiplier method is a relevant and often used tool for appraising these types of income-generating assets.

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