How many units makes it commercial?

General Real Estate Investing
1

I have a multi-unit building in which I’d like to upgrade the electrical service. The local building department said that I need an engineering drawing because the building is 4 units - which makes it commercial. My understanding is and always has been that 1-4 unit buildings are residential and OVER 4 units in a building is commercial.
I have looked at a lot of references and found a lot of anecdotal evidence to support my position, but nothing in writing from an authoritative source.

What number of units in a building makes it commercial? Anyone have a written source to back up their answer? I’m in Ohio is that matters.

Thanks,

Mike

2

Mike,

Normal when the question is asked, “How many units make it commercial?” that is in relation to lending. This may be a case where the local building codes and/or zoning differ from the lenders’ definition. I would ask them to provide me with a written citing – they’re the government and that’s part of what they’re there for (e.g., to serve the public as public servants!)…remember your taxes pay them!

Keith

3

What county is the property in? Not that it makes much difference but some counties I am sure have variances in the guidelines for building codes.

As far as lending gos it’s anything over 4 units

4

Hi Mike,

I’ve sent you a PM with contact info of a person that might be able to help you.

-Mike

5

Not sure if it changes from state to state or even county to county, but here in NJ 1-4 units are residential 5 and above are commercial.

6

Thanks for all your replies. I just got off the phone with an attorney from our REIA and she had a copy of the building code. Apparently, Keith is exactly right. The 1-4 units that I am used to seeing as residential applies to lending. The Ohio building code is apparently entitled something like The 1, 2, and 3 Family Building Code, and then there is a separate commercial building code. So, it looks like I will need an engineering drawing.

Thanks,

Mike