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the Redwood City Fox was 58 years old. However, rather than
estimating accrued depreciation for the Redwood City Fox as it
existed on December 31, 1986, Ingram/Ewing estimated depreciation
for the Redwood City Fox as if the projected maintenance and
restoration work discussed above had already been completed.
They thus concluded that both the theater and the retail/office
components of the property had an “effective age” which was less
than the Redwood City Fox’s actual age. To explain their reason
for estimating depreciation in this manner, with respect to the
theater portion, Ingram/Ewing listed 4 theaters that ranged in
age from 79 to 131 years old, and explained:
These theaters are from 79 to 131 years old and still
remain in good to excellent condition and are in
current use, a characteristic that is specific to
performing arts theaters. For this reason it is
difficult to predict depreciation or remaining life.
This RCFox Theatre is in good condition and with the
projected restoration is expected to be brought to
“market condition” as previously discussed which is
projected to be excellent condition. Therefore, in
considering these facts and relying on Marshall
Valuation Service, together with appraisal experience,
it is concluded that based on 45 years life expectancy,
the subject theater has an effective age of 18 years
and based on the Marshall Depreciation Table for
Commercial Properties, is 19 percent depreciated. This
amounts to $1,044,475 depreciation leaving Net
Depreciated Value of Improvements of $4,995,168.
Utilizing the same methodology with respect to the retail/
office space, Ingram/Ewing estimated depreciation as follows:
Marshall Valuation Service has a guideline of typical
building lives of 50 years for class C average offices.
Therefore, we must consider that this office space is
an integral part of the theatre space in coexisting for
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