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<br /> The purpose of this analysis is to establish the reuse value of the subject site being conveyed to the
<br /> Auto Dealer, the Batarse Family Trust, operating as the Lloyd A. Wise Companies. The fair
<br /> reuse value is the fair market value for a developable site subject to the specific terms and
<br /> conditions of the Disposition and Development Agreement ( "DDA ") that control the reuse of the
<br /> site. Pursuant to the DDA, the Auto Dealer is required to develop several new automobile
<br /> dealerships on the north side of Marina Boulevard in San Leandro. Separately, the Auto Dealer is
<br /> privately assembling additional acreage in the immediate area as part of the overall development
<br /> agreement.
<br /> The valuation of real estate is derived principally through three approaches to market value: the
<br /> cost approach, the market data comparison approach, and the income approach. From the
<br /> indication of these separate analyses and the weight accorded each, an opinion of value is reached,
<br /> • based on the quantity and quality of the factual data considered, tempered by the judgment and
<br /> experience of the appraiser who is utilizing commonly accepted methods and techniques within
<br /> the framework of the appraisal process. The cost approach is not applicable due to the fact that
<br /> this appraisal is for the valuation of a site where the improvements have no value and will be
<br /> demolished or totally renovated. The Income Approach is also not applicable. This approach is
<br /> based upon the income and cost characteristics of the proposed project, which are unknown.
<br /> The market data comparison approach to value is based upon the principle of substitution; that is,
<br /> when a property. is replaceable.in the market, its value tends to be set at the cost of acquiring an .
<br /> equally desirable substitute property, assuming no costly delay in making the substitution. .The •
<br /> typical appraisal technique used. to estimate values through substitution involves the collection and . .
<br /> analysis of sales and listings on various sites having as many similar characteristics as possible as •
<br /> the site being appraised. This analysis will utilize the market data comparison approach, as
<br /> outlined below.
<br /> Recent land sales for subsequent development of mostly freestanding auto and related auto retail
<br /> uses can be found throughout the area. There are very few land sales (of improved or partially
<br /> improved sites) for reuse as multiple auto dealerships within the San Leandro market area.
<br /> • Therefore, KMA reviewed several sales of vacant, unimproved auto dealership sites in the East
<br /> Bay and South Bay areas. If the Auto Dealer's total assemblage costs are in line with what other
<br /> auto dealers are required to pay to assemble dealership sites in the Bay Area, then the proposed
<br /> agreement between the Agency and the Auto Dealer will yield a fair reuse value for the land being
<br /> conveyed to the Auto Dealer. The following analysis is a detailed discussion of other auto dealer
<br /> land sales.
<br /> A. Land Values - Other Bay Area Auto Dealer Land Sales
<br /> K E Y S E R M A R S T O N ASO I RTES INC.
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