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2. Mr. Pio’s Report
In valuing the subject property, Mr. Pio made a
“hypothetical assumption” that Phases 2 and 5 were legally
partitioned on the date of death.11 He then determined the fair
market value of Phase 5 using seven comparables:
10(...continued)
distinguishable from Estate of Rodgers because there has been no
showing that, due to their numerosity, the Phases could not be
sold within a reasonable time without depressing their sales
prices. In fact, Mr. Kelley did not purport to use his
discounted cashflow analysis to take into account a market
absorption rate, nor does the estate argue that Mr. Kelley’s
discounted cashflow analysis was used to take into account a
market absorption rate.
11 The estate argues that Mr. Pio’s “hypothetical
assumption” was inappropriate because Mr. Pio does not take into
account costs associated with the subdivision of the phases for
individual sale. However, both parties valued Phases 2 and 5 as
if they were separate properties on the date of death. It does
not appear that Mr. Kelley took into account the costs associated
with the subdivision of the phases, nor does the estate offer an
estimate of such costs. Because the estate has failed to provide
any basis upon which we could make an estimate, we cannot take
such costs into consideration.
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