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(6) It has been Mr. Steele’s experience that unexpected
expenses occur in connection with perfecting sole ownership or
control. It has been his experience that unanticipated legal
problems may arise.
(7) The buyer of an undivided interest must have financial
“staying power” and be able to buy the entire property at any
partition sale because of the possibility of underbidding of
amounts that would be proportionately less than the cost of the
undivided interest.
Mr. Steele considers the following factors in determining
the amount of discount that should be applied in the purchase of
a fractional interest: Fair market value of 100-percent
ownership; percentage available for sale; total number of owners;
“staying power” of existing owners; property location; number of
tracts; number of acres; ability to influence property management
by the buyer of a fractional interest; continuity of the tracts;
access to the property(ies); topography (including wetland
classifications); and mineral value, either in or out of
production.
Using his knowledge and experience, he opined in his written
report that the discount for the fractional interests under
consideration should be at least 55 percent. During his trial
testimony, Mr. Steele concluded that he would discount the
fractional interests in question by 90 percent on the basis of
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