03-03-1996 WS - Laserfiche WebLink

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sales included indicate that no adjustments for condition of sale or characteristics of income were needed. 111 Adjustments for size, age, condition/quality, and land to building ratio reduces the strength of this approach. • The comparables were considered similar for location. • Four of the comparable sales were adjusted of size. • Comparables #2 and #4 were adjusted for their age. • Comparable #4 was considered good to the subject in its condition and quality; Comparables #1 and #5 was considered average in their condition/quality. • Four of the sales were adjusted for the amount of land available to the building. • Four of the sales were adjusted to reflect the amount of interior fmish in the property. Overall, the number of sales, comparable to the subject property, which occurred within the Twin Cities over the past several years, was considered average. However, the supporting details regarding each sale was limited. Income Appro. h The Income Approach, in which anticipated benefits of ownership are converted to an indication of value, reflects the thinking of the typical investor in an income oriented property. Unfortunately, no historic operating information on the subject property was provided. The estimation of income and expenses was forecasted based on rental information and operating expenses obtained from the market. In this report, we have applied the direct capitalization method for estimating the value of the subject property. This approach is limited because of the lack of historic information, the recognition of replacement reserves, the lending requirements influencing capitalization rates, and the sensitivity resulting from these assumptions. The Income Approach is given less weight of the overall estimated market value than the Sales Comparison Approach. S -96-