1979-12-28_GENERAL DOCUMENTS - C1981017

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In this appraisal , the market data approach has a limited application because of lack of highly comparable sales . There is often a vast difference between properties from the standpoint of location, type of occupancy, building age and condition. In fact, there is a substantial difference between the sales . In making this study, I have considered a number of commercial property sales in the Glenwood Springs/Garfield County area. A list of these sales may be found in the Addenda. The commercial/warehouse sales took place from October 1 , 1976 , to May, 1979 . The total sales ranged from a low of $59 ,500 to a high of $256 , 700 . The building sizes ranged from 1 , 700 square feet to 13 , 661 square feet. Dividing sales prices by gross building area in- dicates a range from $18. 79 to $50 . 00 per square foot. The gross rent multiples range from 7. 57 to 9 . 09 . Other commercial sales known to the writer render gross rent multiples in a range of 4 . 78 to 11. 0. It is my opinion that the higher multiples tend to reflect rents that did not represent current market rents at the time of the sale. The higher multiples also tended to be associated with sales where amenities other than produc- tion of income were important. The lower multiples were developed from sales with higher expense ratios and also were associated with sales that required more intensive time consuming management as well as sales with shorter economic lives . An analysis of market value by the per square foot of building method was not used in this appraisal as the surplus land and the various functions which the property serves required so many adjust- ments as to make this approach an exercise in futility. None of the listed improved sales are very comparable to the market data approach. It is my opinion that the proper gross rent multiple (GRM) in- dication for the subject property would be 7 . 0. The following indication seems reasonable and is believed to incorporate location and project size. MARKET APPROACH SUMMARY Gross Rent $221 , 153 X 7 . 00 GRM = $1 ,548 ,071 Excess Land Contribution - 4 . 5 Acres = $ 400 ,000 Market Approach Conclusion $1 ,948 ,071 -12-