- 11 - A. The Fair Market Rental Value of Watt Avenue, Mother Lode Drive, and Fee Drive Both parties submitted substantial evidence concerning the fair market rental value of three of the properties petitioner leased: Watt Avenue, Mother Lode Drive, and Fee Drive. Respondent submitted separate appraisal reports on each of the three properties prepared by Kenneth R. Harris, MAI, of Hopkins Appraisal Services, Inc., a national appraisal firm specializing in the appraisal of petroleum properties. Mr. Harris used the same basic methodology for all three properties. First, Mr. Harris determined the fair market value of the land using only the cost approach to value, because he found both the market and income approaches to be irrelevant to the appraisal of raw land. Under the cost approach, Mr. Harris determined the sale prices of four or five comparable properties and computed a sale price per square foot for each of the comparable properties. He then used his judgment to adjust the sale price per square foot of each of the comparable properties for perceived differences between the comparable properties and the subject. Very significant adjustments were made, leading us to question whether these properties were true “comparables”. Adjustments on the Fee Drive property ranged from 20 to 60 percent and on the Mother Lode Drive property ranged from 15 to 40 percent. One of the four “comparables” on the Watt Avenue property was adjusted by 65 percent. It would be very easy to justify much higher orPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011