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The third method used by Hulberg was the Comparable Sales.
He found two sales which he believed were comparable. The first
was a 50-percent undivided interest in a $2 million, multitenant
office building. The fractional interest discount was 35
percent. The second comparable was a 50-percent general
partnership interest in a family property worth $3,390,000. The
discount was 29 percent.
Petitioner’s second expert, White, agrees with Hulberg that
partnership discounts are relevant to the facts at hand because
they represent diversified pools of leases on multiple buildings
to different tenants, thus reducing the risk of a single
obligation by a single tenant at one location. Also a
partnership unit is more valuable than an undivided private
interest because a negotiated, secondary market exists for the
former. White reasons that the median discount in the traded
market for a multilease, private partnership interest should be
doubled due to these factors. He arrives at a 25.4-percent
discount. He then adds an additional 10-percent discount to
compensate for the highly valued professional management
available for partnership units that is not available on
decedent’s properties.
Considering the parties’ experts’ reports and opinions, we
find that the appropriate discount amount should be neither as
low nor as high as those suggested. We find that a 25-percent
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