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Mansbach initially prepared his appraisal report in early
1994 and submitted it to respondent on March 16, 1994. In early
1996, Mansbach revised his appraisal report, performing what he
termed “editorial type * * * modifications” at respondent’s
request. Mansbach's revised appraisal report was submitted to
respondent on April 4, 1996. Mansbach testified that there were
no changes in the revised report with respect to his reasoning or
his conclusions as to the value of the Redwood City Fox.
For valuing the Redwood City Fox, Mansbach found that the
replacement cost method was (1) inappropriate because it would
not be "economically feasible to replace the existing structures
in today's market", and (2) unreliable due to the subjective
nature of estimating accrued depreciation on a 65-year old
building with significant functional, exterior, and physical
deterioration. Additionally, with respect to the theater
component of the property, Mansbach found that the income
capitalization approach was inappropriate because "the purchaser
of the theater is likely to be a non-profit entity which places
little emphasis on its income producing capabilities."
Consequently, Mansbach utilized the comparable sales approach for
the theater component of the property. For the retail/office
component, which Mansbach valued separately from the theater,
Mansbach utilized both the sales comparison and income
capitalization approaches. Mansbach also included a valuation of
the underlying land, as if vacant.
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