- 14 - Petitioner's expert also relies on certain market studies that would indicate combined discounts for minority interests and lack of marketability of between 30 and 60 percent. Respondent's expert concludes that looking ahead from the December 31, 1989, date-of-death valuation date to the years following 1989, lease income from the Partnership Properties would likely increase and the Partnership Properties would likely increase in value. Respondent's expert estimates gross lease income for the first year of $16,345,491 and increases this figure by 5 percent per year over a projected 12-year period, with a 1-percent contingency loss reserve to reflect vacancies and collection losses. Respondent's expert also estimates that operating expenses in the first year of his analysis would equal $6,920,501, and respondent's expert increases estimated operating expenses by 5 percent per year in his cash-flow analysis. Respondent's expert then capitalizes his 12-year cash-flow projection using a capitalization rate of approximately 7.9 1(...continued) Partnership -- one individual inherited 62.5 percent of the unit and the other inherited 37.5 percent. In July of 1989, for reasons not made clear in the record, the first individual sold to Mr. Silver his 62.5-percent interest in the ownership unit for $125,000. The record is incomplete with regard to significant aspects of this transaction.Page: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
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