Epic Associates 84-III, William C. Griffith, Jr. - Page 59




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                  Because market risk for EA83-XII and EA84-III                       
                  related to multiple units acquired in bulk sales                    
                  and not single units acquired in separate                           
                  transactions and the appraisals obtained by Epic                    
                  for the properties were only on an individual                       
                  basis using market and cost approaches, the                         
                  separate appraisals for each property did not                       
                  realistically reflect the market risk or value                      
                  to EA83-XII and 84-III.  [Emphasis supplied.]                       

                  We agree with Dr. Hewitt that each partnership made                 
             bulk purchases of the properties and received special                    
             discounts from the sellers and that each partnership                     
             undoubtedly paid a fair price for the properties that it                 
             purchased.  We agree with Dr. Hewitt that each partnership               
             purchased the properties for resale.  As Dr. Hewitt stated:              

                  Someone buying, in the case of Epic, 40, 100, 200                   
                  homes at a pop, obviously, is not going to live                     
                  in those homes.  The intent from a typical market                   
                  purchaser's standpoint, if you were to buy a                        
                  hundred homes, would be to resell those.                            

             We further agree with Dr. Hewitt that the contemporaneous                
             appraisals valuing each property individually do not                     
             reflect the bulk purchases made by each partnership.                     
                  The question that we must decide, however, is whether,              
             for purposes of determining the bona fides of the subject                
             indebtedness, the fair market value of the properties must               
             be determined in the wholesale market, the market in which               
             the partnerships purchased the properties, or the retail                 







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