- 34 - from which they deducted $69,000, for a net addition of $64,500. To this figure, they added 7 percent for General Conditions and 5 percent for Profit, for a total upward adjustment of $72,240 to the $5,425,000 estimate in the Adamson report, for a total replacement cost estimate of $5,497,240 for theater portion, Unit A, of the Redwood City Fox. Ingram/Ewing next estimated the “Projected Restoration and Deferred Maintenance Cost” of repairing/restoring the Redwood City Fox to a condition they term “Market Condition”. Ingram/Ewing explained their methodology as follows: Appraisal of this property employs the Cost Approach which is calculated by estimating the replacement cost less depreciation, added to the estimated land value. Since this property is in the process of being restored, it is appropriate to project the costs of restoration or rehabilitation to bring it to the condition that it may be offered at market rent or market sale for it[s] highest-and-best use, which we will call “Market Condition”. These projected costs are then deducted as capital expenses from the estimated market value of the property as if the property was completely rehabilitated and ready for market. The projected costs are estimated separately for each of the four unit spaces * * * . Ingram/Ewing estimated the cost of “restoration and maintenance” for the theater portion to be $1,222,045. They estimated the cost of “restoration and maintenance” for the retail/office portions, Units B, C, and D, to be $55,295. Ingram/Ewing next estimated accrued depreciation, both physical deterioration and functional obsolescence, for the Redwood City Fox. On the valuation date of December 31, 1986,Page: Previous 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 Next
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