- 30 -
taking his deduction he assumed that the Property was not
contaminated. In light of no contamination and the needed
presence of the tanks, Aguilar has not convinced the Court that a
hypothetical buyer with reasonable knowledge of the facts would
have discounted the value of the Property due to the presence of
the tanks. Therefore, we find Aguilar's deduction for removal of
the tanks to be inappropriate. See Estate of Necastro v.
Commissioner, T.C. Memo. 1994-352 (where taxpayer failed to prove
that a buyer purchasing the property on the valuation date would
have perceived the possibility of contamination as a problem
causing a reduction in value).
Having carefully reviewed the experts' testimony and
appraisal reports, and having accepted none of the experts'
reports in their entirety, we must now proceed to determine the
FMV of the Property on the facts before us.
For the reasons which follow, we think that the
capitalization-of-earnings approach is the most suitable method
of valuation in this case. See Honigman v. Commissioner, 55 T.C.
1067 (1971), affd. in part, revd. in part and remanded 466 F.2d
69 (6th Cir. 1972); Gottlieb v. Commissioner, T.C. Memo. 1974-
178. No sales of vacant land occurred in the Johnston Street
corridor from 1985 through the valuation date, despite being
offered. Moreover, at the time of sale, there was a shortage of
lending in Lafayette for development. In that connection, the
experts all agreed that the highest and best use of the Property,
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