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property by the Carbonell and Tarnow report.29 The Carbonell and
Tarnow report determined the value of the Cathead property based
on a sale of all parcels of the Cathead property over a 5-year
period and with a 9-percent required rate of return. However, in
valuing decedent’s interest in Clubside, Mr. Bishop projected a
sale of all parcels of the Cathead property over a 3-year period
and with a 30-percent required rate of return. The estate failed
to explain why it used a 3-year period when it relied on the
Carbonell and Tarnow report which used a 5-year period. In
support of a 30-percent rate of return, Mr. Bishop testified that
he used that figure based on his experience and judgment, and the
fact that Clubside was a closely held family partnership with no
basic agreements to sell anything. We find Mr. Bishop’s 30-
percent rate of return over 3 years to be excessive based on the
facts before us. Mr. Bishop stated in his valuation report that
he had discussions with real estate brokers located near the
Cathead property who told him that property values in that
vicinity of the Lake Michigan coastline area were stable with
modest appreciation. The estate presented no evidence to justify
a 30-percent rate of return.
29Mr. Bishop did not adjust the value of the Cathead
property upward, despite testifying and stating in his valuation
report that he spoke with real estate agents who told him that
property values in this area of Lake Michigan were stable with
modest appreciation.
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