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which is abundant with data on the subject properties and their
marketability. In passing on whether a market absorption discount
applies in the instant setting, and the amount of such a discount if
it does apply, we utilize a five-part analysis. First, we examine
the assets to be valued and categorize these assets by type. Second,
we ascertain the market value (i.e., the fair market value without
consideration of a discount for market absorption) of each asset in
each category, assuming that each asset will be marketed separately.
Third, we compare the number of assets in each category to the number
of assets of that type which are traded in the market over a
reasonable period of time. Fourth, we ascertain how much longer than
this reasonable time period it would take to sell at market value (as
defined above) each asset that could not be sold in this reasonable
time period. Fifth, we discount the value of each asset in the
category of assets that cannot be sold within a reasonable time
period, taking into account the time value of money and the period of
time that the category of assets would have to be marketed in order
to sell each asset therein.
1. Assets To Be Valued
We start by examining the assets to be valued and categorizing
these assets by type. Blockage applies to narrowly drawn classes;
namely, shares of stock that are trading on an established market.
16(...continued)
more quickly.
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