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Income Approach -- continued <br />Discussion of Adjustments <br />Date of Lease: Comparables 2 and 3 asking rates appear to be somewhat strong for the market, <br />adjusted downward. The remaining comparables reflect current contract rents and were signed when the <br />market was relatively stable, no adjustment. <br />Concessions/Effective Rent: Factors in and takes into consideration any above — or below — market <br />tenant improvements (TI's). Additionally, concessions include moving costs, lease -buyouts, etc. <br />Concessions were market, no adjustment. <br />Location: This adjustment is based on the appraiser's judgment. It takes into consideration surrounding <br />land uses, intended use, neighborhood characteristics, traffic, exposure and access. Comparables 2 and <br />6 adjusted for less visibility. Comparable 5 adjusted for superior location. <br />Zoning/Use: Comparables considered competing. <br />Site Size / Land to Building Ratio: Site size adjusted using Site SF/GBA SF ratio. Adjustment based <br />on 1 % per difference in land to building ratio. The adjustment is based on discussions with market <br />participants as well as previously observed rents. <br />Age: Adjustment is based on effective age, adjusted at %% per year difference from subject. <br />Quality/Appeal: Buildings with better design (more detail and variation) are typically considered more <br />appealing. Comparable 3 adjusted for less appeal. Comparable 4 adjusted for a metal building (less <br />appeal). Comparable 5 adjusted for excellent appeal building. The adjustment is based on discussions <br />with market participants as well as previously observed rents. <br />Condition: This is a more subjective item, which is based on reported building condition and external <br />viewing. Comparables 2, 4, 5, and 6 adjusted for superior condition buildings. The adjustment is based on <br />discussions with market participants as well as previously observed rents. <br />Basement: The comparables and subject are rated similar, no adjustment. <br />Parking/site: The subject and comparables have adequate parking, no adjustment. <br />Nagel) Appraisal Incorporated 1952.544.8966 <br />