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if it had been vacant land, would have been to leave it for
future development. Thus, the replacement-cost method is
unpersuasive in our view. See Honigman v. Commissioner, supra;
Gottlieb v. Commissioner, supra ("We think it unrealistic to
determine fair market value by * * * cost of reproduction when
such structure would not have been reproduced.").
Furthermore, we agree with Aguilar that the market-data
approach is unjustified here. The sales of improved properties
brought to the Court's attention by Lambert and Parker are simply
not comparable to the subject Property in our view for the
reasons mentioned earlier.
On March 31, 1987, as then improved, the highest and best
use of the Property was as an automobile dealership. Using the
capitalization-of-earnings approach, we begin with a gross
building area for the Property of 19,504 square feet. This
figure represents the 16,994 square feet used by Parker, plus the
2,510 square-foot paint and body shop that he neglected to
include in his analysis. We next estimate a rental rate for the
Property of $3.25 per square foot. This rate is approximately
the same as that for the 3203 Johnston Street property used as a
lease comparable by all 3 experts. 3203 Johnston Street was
sublet in April 1988 at $36,000 per year with a gross building
area of 10,875 square feet, for a rate of $3.31 per square foot.
In response to respondent's argument, we do not consider the
$10,000-per-month lease rate between the Laniers and Harvey to be
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