Agenda - Council - 04/09/2019 - Laserfiche WebLink

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PROPERTY RIGHTS APPRAISED Real property ownership consists of a group of distinct rights. There are two primary property rights, Fee Simple and Leased Fee (as defined by The Appraisal of Real Estate, 13th Edition, Appraisal Institute). Fee Simple Interest: Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat. Note: This would typically reflect an owner -occupied property. When the property rights appraised are the unencumbered fee simple interest of the real estate, the appraised value is subject to normal easements for drainage, public streets and utilities, if any. The effect of any existing mortgage or delinquent taxes on the subject property has not been considered in this appraisal. Leased Fee Interest: The ownership interest held by a lessor (landlord), which includes the right to the contract rent specified in the lease plus reversionary right when the lease expires. The lessor's interest in a property is considered a leased fee interest regardless of the duration of the lease, specified rent, the parties to the lease, or any of the terms in the lease contract. A leased property, even one with rent that is consistent with market rent, is appraised as a leased fee interest, not as a fee simple interest. Even if the rent of the lease terms are not consistent with market terms, the lease fee interest must be given special consideration and is appraised as a leased fee interest. (The Appraisal of Real Estate, 13th Edition, Page 114) The subject is currently vacant, but would likely be owner occupied upon purchase. Given this, the appraised value will reflect the Fee Simple interest. PROPERTY COMPONENTS APPRAISED Real Estate: The appraised value includes the real estate value opinion. The methods utilized for the real estate valuation include: • Sales Comparison Approach • Income Approach FF&E: Furniture, Fixtures, & Equipment (FF&E): The appraised value does not include any values of fixtures, furnishings and equipment. The appraised value reflects real estate only. Business Value: There is no business value included in the appraised value. Nagel) Appraisal Incorporated 1952.5-+-r.c U