Reso 2015-2405 - Laserfiche WebLink

Home Browse Search

SITE VALUATION 56 Analysis of Sales Property Rights Conveyed— A fee simple interest was paid for each property, similar to the ownership interest under valuation for the subject in this portion of the analysis. Sale 2 is currently leased to a fast food restaurant, however the lease is scheduled to expire in the relative near term, and the price paid for the site is reflective of land value for future redevelopment. As such, no adjustments for property rights were warranted. Financing Terms — The transaction price of one property may differ from that of an identical property because financing arrangements vary. If a buyer of a certain property assumed an existing mortgage at a favorable (below current market) interest rate, the buyer may have paid a higher price than a purchaser of the subject can be expected to pay under current market financing terms. Other forms of favorable financing often include below-market seller financing, such as purchase money and/or wraparound mortgages. All of the comparables represent cash transactions, or were financed by acquisition and development loans at market rates; thus, no adjustment for cash equivalency was required for any of the comparable sales. Conditions of Sale (Motivation) —When the conditions of sale are atypical the result may be a price that is higher or lower than that of a normal transaction. When non-market conditions of the sale are noted, the sale should be related to the subject only with great care. Typically, market based adjustments are very difficult to make for such situations. With regard to the comparable sales, all were verified as "arm's-length" transactions between unrelated parties under no duress and thus, no adjustments were warranted. Market Conditions (Time) — Market conditions may change between the time of sale of a comparable property and the date of the appraisal of the subject. Under these circumstances, the price of the comparable property would be different at the date of the appraisal, and an adjustment should be considered. Time itself does not necessitate an adjustment, but rather a shift in market conditions over time. If market conditions have not experienced any significant change, no adjustment would be required, even if a considerable amount of time had passed. The comparable sales, which represent similar and competitive development sites, transferred over a 2+ year period and reflect a substantial increase in pricing. Therefore, upward adjustments were applied to Sales 3 and 4, which occurred in mid-2012. The recent transaction and contract dates of Sales 1 and 2 reflect current market conditions and thus no other adjustments were warranted. Location — An adjustment for location may be required if the locational characteristics of a comparable property are significantly different from those of the subject property. The Clobus, McLemore & Duke, Inc.