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costs of the three properties to be between $30,000 and $40,000
if no trial were necessary and between $90,000 and $120,000 if a
trial were necessary. He estimated these costs to be 3 to 4
percent of his estimated value of a one-half interest in the
Kmart property. Without a clear explanation of the increase,
Thomson increased his estimation of the partition cost discount
to 10 percent for the Kmart property, rounding up to an estimated
partitioning cost of $300,000. He applies the same 10-percent
discount to the Walgreen property interest, rounding up to an
estimated partitioning cost of $135,000, and explains the
difference in partitioning costs of the Kmart property and the
Walgreen property by stating that partitioning costs increase
with the size of the property. He increased the discount amount
of the Wells Fargo property to 20 percent, reasoning that the
discount is increased due to the cost of partitioning relative to
the lesser value of the Wells Fargo property.
Thomson concluded that the need to discount for control or
marketability is minimized because partitioning would cure any
control problem. He does include, but does not apply,
information on limited partnership discounts at the time of the
valuation date. The range of the rates is between a premium of
8.33 percent (-8.33 percent) to discount of 50.52, with a median
of 12.71 percent and a mean of 13.56 percent.
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