The URL can be used to link to this page

Home My WebLink About3865 Country Club RdIntegra Realty Resources Fort Worth Appraisal of Real Property Parcel 1 Single Family Residence 3865 Country Club Road Denton, Denton County, Texas 76210 Client Reference: Parcel 1 Prepared For: Cobb, Fendley & Associates on behalf of the City of Denton Date of the Report: June 27, 2025 Report Format: Appraisal Report IRR - Fort Worth File Number: 195-2025-0299 Aerial Photograph The Whole Property is outlined in red, the Right of Way acquisition is outlined in yellow, and the drainage easement is outlined in blue. Integra Realty Resources 7080 Camp Bowie Boulevard T 817.763.8000 Fort Worth Fort Worth, TX 76116 www.irr.com June 27, 2025 Michael Hale, SR/WA, R/W-URAC, R/W-NAC, R/W-RAC Principal | Regional Right-of-Way Manager Cobb, Fendley & Associates 6500 West Fwy Fort Worth, TX 76116 SUBJECT: Market Value Appraisal Parcel 1 3865 Country Club Road Denton, Denton County, Texas 76210 Client Reference: Parcel 1 IRR - Fort Worth File No. 195-2025-0299 Dear Mr. Hale, Integra Realty Resources – Fort Worth is pleased to submit the accompanying appraisal of the referenced property. The purpose of the appraisal is to develop the following opinions of value: • The market value of the fee simple interest in the subject property as of the effective date of the appraisal, April 18, 2025 The client for the assignment is Cobb, Fendley & Associates on behalf of the City of Denton. The intended users of this report are the client. The intended use of the report is to assist the client and assigns in determination of adequate compensation due to the property owner for the right of way acquisition and drainage easement. No other party or parties may use or rely on the information, opinions, and conclusions contained in this report. The Whole Property contains 2.1354 acres, or 93,018 square feet, and is located on the northeast corner of West Ryan Road and Country Club Road within the city limits of Denton, Texas. The parts acquired are defined as a 0.1827 acre or 7,957 square foot Right of Way Acquisition as well as a 0.1036 acre or 4,512 square foot drainage easement. It is necessary for the City of Denton to acquire the subject property as a part of the Ryan Road expansion project. Michael Hale, SR/WA, R/W-URAC, R/W-NAC, R/W-RAC Cobb, Fendley & Associates June 27, 2025 Page 2 The appraisal conforms to the Uniform Standards of Professional Appraisal Practice (USPAP), the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute, applicable state appraisal regulations. Standards Rule 2-2 (Content of a Real Property Appraisal Report) contained in the Uniform Standards of Professional Appraisal Practice (USPAP) requires each written real property appraisal report to be prepared as either an Appraisal Report or a Restricted Appraisal Report. This report is prepared as an Appraisal Report as defined by USPAP under Standards Rule 2-2(a), and incorporates practical explanation of the data, reasoning, and analysis that were used to develop the opinion of value. Michael Hale, SR/WA, R/W-URAC, R/W-NAC, R/W-RAC Cobb, Fendley & Associates June 27, 2025 Page 3 Based on the valuation analysis in the accompanying report, and subject to the definitions, assumptions, and limiting conditions expressed in the report, the concluded opinions of value are as follows: Value Conclusion Value Type & Appraisal Premise Interest Appraised Date of Value Value Conclusion Compensation Fee Simple April 18, 2025 $70,272 Value of the Whole Property $418,912 By Sales Comparison Approach - Land Fee Simple $4.50 x 93,018 SF x 100%=$418,581 By Cost Approach $418,912 By Sales Comparison Approach - Improved N/A By Income Capitalization Approach N/A Value of the Part Acquired $54,412 By Sales Comparison Approach - Drainage Easement Easement $4.50 x 4,512 SF x 90%=$18,274 By Sales Comparison Approach - PTA Fee Simple $4.50 X 7,957 SF X 100%=$35,807 Value of Improvements located within PTA =$331 Value of the Remainder Before $364,500 Value of the Remainder After the Acquistion $364,500 By Sales Comparison Approach Fee Simple $4.50 x 80,549 SF x 100%=$362,471 $4.50 x 4,512 SF x 10%=$2,030 Reconciliation $364,500 Damages/Enhancements (Remainder Before - Remainder After)$0 Cost to Cure $15,860 Compensation $70,272 Michael Hale, SR/WA, R/W-URAC, R/W-NAC, R/W-RAC Cobb, Fendley & Associates June 27, 2025 Page 4 Extraordinary Assumptions and Hypothetical Conditions 1.All information relative to the subject property, including land areas and other pertinent data that was provided by the client and public records, is assumed to be correct. 2.It is assumed that there are no environmental issues that impact the use or value of the subject property. 3.The subject is appraised under the extraordinary assumption that there are no subsurface improvements located within the acquisition. 1.The project for which the acquisition is necessary is assumed to be complete and being fully utilized for purposes of estimating the value of the Remainder After the Acquisition, it is also assumed that the property is affected by the project similar to the community. If it becomes known that there are specific damages that affect the subject property that are not considered herin, this appraisal and its conclusion may be subject to reconsideration. The use of any extraordinary assumption or hypothetical condition may have affected the assignment results. The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. If you have any questions or comments, please contact the undersigned. Thank you for the opportunity to be of service. Respectfully submitted, Integra Realty Resources - Fort Worth Brent Pitts, MAI, AI-GRS, R/W-AC Certified General Real Estate Appraiser Texas Certificate # 1380206 G Telephone: 817.763.8000 Email: bpitts@irr.com Mitchell L. Etter, M.Ed. Certified General Real Estate Appraiser Texas Certificate # 1381464 G Telephone: 817.205.1414 Email: metter@irr.com Table of Contents Parcel 1 Quality Assurance 1 Executive Summary 2 Project Description 3 Identification of the Appraisal Problem 4 Subject Description 4 Sale History 4 Pending Transactions 4 Appraisal Purpose 4 Appraisal Premise Definitions 4 Definition of Market Value 5 Property Rights Definitions 5 Client and Intended User(s) 5 Intended Use 5 Applicable Requirements 5 Report Format 6 Prior Services 6 Appraiser Competency 6 Scope of Work 7 Economic Analysis 9 Denton County Area Analysis 9 Surrounding Area Analysis 17 Property Analysis 24 Land Description and Analysis 24 Real Estate Taxes 31 Highest and Best Use 32 Valuation 34 Valuation Methodology 34 Sales Comparison Approach 35 Land Value Conclusion 42 Cost Approach 43 Replacement Cost 43 Replacement Cost 44 Depreciation 44 Value Indication 45 Part Acquired 46 Partial Acquisition Description 46 Part Acquired Survey - Parcel 1 48 Part Acquired Survey - Parcel 1 Drainage Easement 49 Economic Unit 49 Highest and Best Use – Part Acquired 49 As Vacant Analysis – Part Acquired 50 As Improved Analysis – Part Acquired 50 Valuation Methodology 50 Land Value - Part Acquired 50 Easement Valuation Matrix 50 Remainder Before the Acquisition 52 Analysis of the Remainder After 52 Property Description - Remainder After 52 Highest and Best Use - Remainder After – As If Vacant 53 Cost to Cure 53 Estimate of Compensation 54 Exposure Time 55 Marketing Time 55 Addenda A. Appraiser Qualifications B. IRR Quality Assurance Survey C. Definitions D. Comparable Data Quality Assurance 1 Parcel 1 Quality Assurance IRR Quality Assurance Program At IRR, delivering a quality report is a top priority. Integra has an internal Quality Assurance Program in which managers review material and pass an exam in order to attain IRR Certified Reviewer status. By policy, every Integra valuation assignment is assessed by an IRR Certified Reviewer who holds the MAI designation, or is, at a minimum, a named Director with at least ten years of valuation experience. This quality assurance assessment consists of reading the report and providing feedback on its quality and consistency. All feedback from the IRR Certified Reviewer is then addressed internally prior to delivery. The intent of this internal assessment process is to maintain report quality. Executive Summary 2 Parcel 1 Executive Summary Property Name Address Property Type Owner of Record Tax ID Land Area (Total)2.1354 acres; 93,018 SF Land Area (Part to be Acquired)0.1827 acres; 7,957 SF Land Area (Drainage Easement)0.1036 acres; 4,512 SF Zoning Designation Highest and Best Use Exposure Time; Marketing Period 6-12 months; 6-12 months Effective Date of the Appraisal April 18, 2025 Date of the Report June 27, 2025 Property Interest Appraised Value Conclusion Value Type & Appraisal Premise Interest Appraised Date of Value Value Conclusion Compensation Fee Simple April 18, 2025 $70,272 James E. Draper 39123 Parcel 1 3865 Country Club Road Denton, Denton County, Texas 76210 Single Family Residential The values reported above are subject to the definitions, assumptions, and limiting conditions set forth in the accompanying report of which this summary is a part. No party other than Cobb, Fendley & Associates and assigns may use or rely on the information, opinions, and conclusions contained in the report. It is assumed that the users of the report have read the entire report, including all of the definitions, assumptions, and limiting conditions contained therein. R2, Residential Residential use Fee Simple Executive Summary 3 Parcel 1 Project Description The proposed acquisition of Parcel 1 will facilitate improvements for the proposed widening of Ryan Road from Teasley Lane to Country Club Road. The anticipated addition of a center turn lane would allow for an improved flow of traffic as motorists making left hand turns off Ryan Road will have the ability to move out of a moving lane prior to turning. The expected impact is a decrease in congestion along Ryan Road, particularly during peak traffic. The project will include two 12-feet wide travel lanes with a full length 11-feet wide center turn lane, new street lighting, a five-foot wide sidewalk path on the south side of Ryan Road, and drainage ditches on both sides. Source: https://www.cityofdenton.com/543/Ryan-Road Identification of the Appraisal Problem 4 Parcel 1 Identification of the Appraisal Problem Subject Description The Whole Property contains 2.1354 acres, or 93,018 square feet, and is located on the northeast corner of West Ryan Road and Country Club Road within the city limits of Denton, Texas. The parts acquired are defined as a 0.1827 acre or 7,957 square foot Right of Way Acquisition as well as a 0.1036 acre or 4,512 square foot drainage easement. It is necessary for the City of Denton to acquire the subject property as a part of the Ryan Road expansion project. A legal description of the property is provided in the addenda. Property Identification Property Name Parcel 1 Address 3865 Country Club Road Denton, Texas 76210 Tax ID 39123 Owner of Record James E. Draper Sale History To the best of our knowledge, no sales or transactions have occurred within the last five years. Pending Transactions Based on available information, the property is not subject to an agreement of sale or an option to buy, nor is it listed for sale, as of the effective appraisal date. Appraisal Purpose The purpose of the appraisal is to develop the following opinion(s) of value: • The market value of the fee simple interest in the subject property as of the effective date of the appraisal, April 18, 2025 The date of the report is June 27, 2025. The appraisal is valid only as of the stated effective date or dates. Appraisal Premise Definitions The definitions of the appraisal premises applicable to this assignment are specified as follows. Identification of the Appraisal Problem 5 Parcel 1 Definition of Market Value “Market Value is the price which the property would bring when it is offered for sale by one who desires, but is not obliged to sell, and is bought by one who is under no necessity of buying it, taking into consideration all of the uses to which it is reasonably adaptable and for which it either is or in all reasonable probability will become available within the reasonable future.” Source: City of Austin v. Cannizzo, 267 S.W.2d 808 (Tex. 1964). Property Rights Definitions The property rights appraised which are applicable to this assignment are defined as follows. Fee Simple Estate Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.1 Client and Intended User(s) The client is Cobb, Fendley & Associates. The intended users are Cobb, Fendley & Associates, the City of Denton, and assigns. No other party or parties may use or rely on the information, opinions, and conclusions contained in this report. Intended Use The intended use of the appraisal is for assist the client and assigns in determination of adequate compensation due to the property owner for the right of way acquisition and drainage easement. The appraisal is not intended for any other use. Applicable Requirements This appraisal report conforms to the following requirements and regulations: • Uniform Standards of Professional Appraisal Practice (USPAP); • Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute; • Applicable state appraisal regulations; • Appraisal requirements of Title XI of the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), revised April 9, 2018; • Interagency Appraisal and Evaluation Guidelines issued December 10, 2010. 1 Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015) Identification of the Appraisal Problem 6 Parcel 1 Report Format Standards Rule 2-2 (Content of a Real Property Appraisal Report) contained in the Uniform Standards of Professional Appraisal Practice (USPAP) requires each written real property appraisal report to be prepared as either an Appraisal Report or a Restricted Appraisal Report. This report is prepared as an Appraisal Report as defined by USPAP under Standards Rule 2-2(a), and incorporates practical explanation of the data, reasoning, and analysis used to develop the opinion of value. Prior Services USPAP requires appraisers to disclose to the client any other services they have provided in connection with the subject property in the prior three years, including valuation, consulting, property management, brokerage, or any other services. We have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment. Appraiser Competency No steps were necessary to meet the competency provisions established under USPAP. The assignment participants have appraised several properties similar to the subject in physical, locational, and economic characteristics, and are familiar with market conditions and trends; therefore, appraiser competency provisions are satisfied for this assignment. Appraiser qualifications and state credentials are included in the addenda of this report. Scope of Work 7 Parcel 1 Scope of Work Introduction The appraisal development and reporting processes require gathering and analyzing information about the assignment elements necessary to properly identify the appraisal problem. The scope of work decision includes the research and analyses necessary to develop credible assignment results, given the intended use of the appraisal. Sufficient information includes disclosure of research and analyses performed and might also include disclosure of research and analyses not performed. To determine the appropriate scope of work for the assignment, the intended use of the appraisal, the needs of the user, the complexity of the property, and other pertinent factors were considered. The concluded scope of work is described below. Research and Analysis The type and extent of the research and analysis conducted are detailed in individual sections of the report. The steps taken to verify comparable data are disclosed in the addenda of this report. Although effort has been made to confirm the arms-length nature of each sale with a party to the transaction, it is sometimes necessary to rely on secondary verification from sources deemed reliable. Subject Property Data Sources The legal and physical features of the subject property, including size of the site, flood plain data, seismic zone designation, property zoning, existing easements and encumbrances, access and exposure, and condition of the improvements (as applicable) were confirmed and analyzed. Inspection Details regarding the property inspection conducted as part of this appraisal assignment are summarized as follows: Property Inspection Party Inspection Type Inspection Date Brent Pitts, MAI, AI-GRS, R/W-AC From right-of-way April 18, 2025 Mitchell L. Etter, M.Ed.From right-of-way April 18, 2025 The property owner was contacted; however, a response was not received. The property was inspected from the public right-of-way. Valuation Methodology Three approaches to value are typically considered when developing a market value opinion for real property. These are the cost approach, the sales comparison approach, and the income capitalization approach. Use of the approaches in this assignment is summarized as follows: Scope of Work 8 Parcel 1 Approaches to Value Approach Applicability to Subject Use in Assignment Cost Approach Not Applicable Not Utilized Sales Comparison Approach Applicable Utilized Income Capitalization Approach Not Applicable Not Utilized In developing an opinion of value for the subject, only the sales comparison approach is used. This approach is applicable to the subject because there is an active market for similar properties, and sufficient sales data is available for analysis. The cost approach is not applicable because there are no improvements that contribute value to the property, and the income approach is not applicable because the subject is not likely to generate rental income in its current state. Denton County Area Analysis 9 Parcel 1 Economic Analysis Denton County Area Analysis Denton County is located in central North Texas, near the northern boundary of the Dallas-Fort Worth Metroplex. Denton County neighbors Cooke County (North), Tarrant and Dallas Counties (South), Wise County (West) and Collin County (East). It is 878 square miles in size and has a population density of 990 persons per square mile. Notable municipalities in the county include Denton, Carrollton and Flower Mound. The county seat is the City of Denton, which is located within the geographical center of the county. Population Denton County has an estimated 2025 population of 1,057,826, which represents an average annual 3.1% increase over the 2020 census of 906,422. Denton County added an average of 30,281 residents per year over the 2020-2025 period, and its annual growth rate exceeded the State of Texas rate of 1.4%. Looking forward, Denton County's population is projected to increase at a 2.1% annual rate from 2025-2030, equivalent to the addition of an average of 23,394 residents per year. Denton County's growth rate is expected to exceed that of Texas, which is projected to be 1.1%. Population Compound Ann. % Chng 2020 Census 2025 Estimate 2030 Projection Denton, TX 139,869 160,902 177,578 2.8%2.0% Denton County, TX 906,422 1,057,826 1,174,795 3.1%2.1% Texas 29,145,505 31,245,372 33,006,956 1.4%1.1% Source: Claritas Population Trends Employment Total employment in Denton County was estimated at 311,551 jobs as of June 2024. Between year- end 2014 and 2024, employment rose by 100,069 jobs, equivalent to a 47.3% increase over the entire period. There were gains in employment in nine out of the past ten years. Denton County's rate of employment growth over the last decade surpassed that of Texas, which experienced an increase in employment of 19.1% or 2,232,744 jobs over this period. A comparison of unemployment rates is another way of gauging an area’s economic health. Over the past decade, the Denton County unemployment rate has been consistently lower than that of Texas, with an average unemployment rate of 3.9% in comparison to a 4.7% rate for Texas. A lower unemployment rate is a positive indicator. Denton County Area Analysis 10 Parcel 1 Recent data shows that the Denton County unemployment rate is 3.3% in comparison to a 3.7% rate for Texas, a positive sign that is consistent with the fact that Denton County has outperformed Texas in the rate of job growth over the past two years. Employment Trends Total Employment (Year End)Unemployment Rate (Ann. Avg.) Year Denton County % Change Texas % Change Denton County Texas 2014 211,482 11,672,985 4.5%5.2% 2015 224,936 6.4%11,831,449 1.4%3.6%4.5% 2016 233,551 3.8%11,972,594 1.2%3.4%4.6% 2017 244,353 4.6%12,224,998 2.1%3.4%4.4% 2018 253,596 3.8%12,539,711 2.6%3.2%3.9% 2019 267,253 5.4%12,802,919 2.1%3.0%3.5% 2020 267,588 0.1%12,264,651 -4.2%6.5%7.7% 2021 290,438 8.5%13,025,292 6.2%4.4%5.7% 2022 300,599 3.5%13,591,394 4.3%3.3%3.9% 2023 315,580 5.0%13,915,979 2.4%3.5%3.9% 2024*311,551 -1.3%13,905,729 -0.1%3.7%4.1% Overall Change 2014-2024 100,069 47.3%2,232,744 19.1% Avg Unemp. Rate 2014-2024 3.9%4.7% Unemployment Rate - December 2024 3.3%3.7% Source: U.S. Bureau of Labor Statistics and Moody's Analytics. Employment figures are from the Quarterly Census of Employment and Wages (QCEW). Unemployment rates are from the Current Population Survey (CPS). The figures are not seasonally adjusted. *Total employment data is as of June 2024. Employment Sectors The composition of the Denton County job market is depicted in the following chart, along with that of Texas. Total employment for both areas is broken down by major employment sector, and the sectors are ranked from largest to smallest based on the percentage of Denton County jobs in each category. Denton County Area Analysis 11 Parcel 1 Employment Sectors - 2024 23.6% 13.7% 13.7% 13.2% 12.5% 6.7% 6.5% 6.1% 2.7% 1.1% 0.2% 19.7% 15.1% 14.4% 11.1% 13.5% 6.5% 7.0% 6.2% 2.7% 1.6% 2.0% 0%5%10%15%20%25% Trade; Transportation; and Utilities Professional and Business Services Government Leisure and Hospitality Education and Health Services Financial Activities Manufacturing Construction Other Services Information Natural Resources & Mining Denton County Texas Source: U.S. Bureau of Labor Statistics and Moody's Analytics Denton County has greater concentrations than Texas in the following employment sectors: 1. Trade; Transportation; and Utilities, representing 23.6% of Denton County payroll employment compared to 19.7% for Texas as a whole. This sector includes jobs in retail trade, wholesale trade, trucking, warehousing, and electric, gas, and water utilities. 2. Leisure and Hospitality, representing 13.2% of Denton County payroll employment compared to 11.1% for Texas as a whole. This sector includes employment in hotels, restaurants, recreation facilities, and arts and cultural institutions. 3. Financial Activities, representing 6.7% of Denton County payroll employment compared to 6.5% for Texas as a whole. Banking, insurance, and investment firms are included in this sector, as are real estate owners, managers, and brokers. Denton County is underrepresented in the following sectors: 1. Professional and Business Services, representing 13.7% of Denton County payroll employment compared to 15.1% for Texas as a whole. This sector includes legal, accounting, and engineering firms, as well as management of holding companies. Denton County Area Analysis 12 Parcel 1 2. Government, representing 13.7% of Denton County payroll employment compared to 14.4% for Texas as a whole. This sector includes employment in local, state, and federal government agencies. 3. Education and Health Services, representing 12.5% of Denton County payroll employment compared to 13.5% for Texas as a whole. This sector includes employment in public and private schools, colleges, hospitals, and social service agencies. 4. Manufacturing, representing 6.5% of Denton County payroll employment compared to 7.0% for Texas as a whole. This sector includes all establishments engaged in the manufacturing of durable and nondurable goods. Major Employers Major employers in Denton County are shown in the following table. Name Number of Employees 1 University of North Texas 8,891 2 Peterbilt Motors Company 2,000 3 Texas Health Presbyterian Hospital Denton 1,100 4 Texas Women's University 1,077 5 Sally Beauty Holdings 1,000 6 Medical City Denton 799 7 Safran Electrical & Power 571 8 Tetra Pak 500 9 ESAB Welding & Cutting 405 10 Flowers Baking Company 375 Major Employers - Denton County, TX Source: Denton Economic Development Partnership Gross Domestic Product Gross Domestic Product (GDP) is a measure of economic activity based on the total value of goods and services produced in a defined geographic area, and annual changes in Gross Domestic Product (GDP) are a gauge of economic growth. Economic growth, as measured by annual changes in GDP, has been considerably higher in Denton County than Texas overall during the past decade. Denton County has grown at a 6.9% average annual rate while the State of Texas has grown at a 3.3% rate. However, Denton County has recently underperformed Texas. GDP for Denton County rose by 2.8% in 2023 while Texas's GDP rose by 7.4%. Denton County has a per capita GDP of $47,907, which is 30% less than Texas's GDP of $68,750. This means that Denton County industries and employers are adding relatively less value to the economy than their counterparts in Texas. Denton County Area Analysis 13 Parcel 1 Gross Domestic Product Year ($,000s) Denton County % Change ($,000s) Texas % Change 2013 24,711,740 –1,511,806,500 – 2014 26,841,164 8.6%1,559,636,100 3.2% 2015 28,956,599 7.9%1,634,127,100 4.8% 2016 30,521,275 5.4%1,633,863,300 0.0% 2017 32,503,089 6.5%1,667,313,000 2.0% 2018 33,816,542 4.0%1,746,543,300 4.8% 2019 36,317,647 7.4%1,806,736,100 3.4% 2020 39,874,794 9.8%1,773,657,100 -1.8% 2021 43,526,928 9.2%1,879,101,300 5.9% 2022 46,954,267 7.9%1,952,708,600 3.9% 2023 48,275,771 2.8%2,097,090,400 7.4% Compound % Chg (2013-2023)6.9%3.3% GDP Per Capita 2023 $47,907 $68,750 Source: U.S. Bureau of Economic Analysis and Moody's Analytics; data released December 2024. The release of state and local GDP data has a longer lag time than national data. The data represents inflation-adjusted "real" GDP stated in 2017 dollars. Household Income Denton County is more affluent than Texas. Median household income for Denton County is $107,546, which is 40.8% greater than the corresponding figure for Texas. Median Denton County, TX $107,546 Texas $76,406 Comparison of Denton County, TX to Texas + 40.8% Source: Claritas Median Household Income - 2025 The following chart shows the distribution of households across twelve income levels. Denton County has a greater concentration of households in the higher income levels than Texas. Specifically, 33% of Denton County households are at the $150,000 or greater levels in household income as compared to 21% of Texas households. A lesser concentration of households is apparent in the lower income levels, as 21% of Denton County households are below the $50,000 level in household income versus 33% of Texas households. Denton County Area Analysis 14 Parcel 1 Household Income Distribution - 2025 8.4% 6.5% 7.2% 10.8% 16.3% 12.6% 9.8% 7.2% 8.8% 4.3% 5.2% 2.9% 5.3% 3.3% 4.3% 8.0% 13.3% 12.3% 11.0% 9.1% 12.7% 6.5% 8.6% 5.5% 0.0%2.0%4.0%6.0%8.0%10.0%12.0%14.0%16.0%18.0% Less than $15,000 $15,000 - $24,999 $25,000 - $34,999 $35,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,000 - $124,999 $125,000 - $149,999 $150,000 - $199,999 $200,000 - $249,999 $250,000 - 499,999 $500,000 and more Denton County, TX Texas Source: Claritas Education and Age Residents of Denton County have a higher level of educational attainment than those of Texas. An estimated 49% of Denton County residents are college graduates with four-year degrees, versus 33% of Texas residents. People in Denton County are older than their Texas counterparts. The median age for Denton County is 38 years, while the median age for Texas is 36 years. Denton County Area Analysis 15 Parcel 1 Education & Age - 2025 Source: Claritas 10% 20% 30% 40% 50% 60% 70% 80% Denton County, TX Texas 49% 33% Percent College Graduate 10 15 20 25 30 35 40 45 50 Denton County, TX Texas 38 36 Median Age Conclusion The Denton County economy will benefit from a growing population base and higher income and education levels. Denton County experienced growth in the number of jobs and has maintained a consistently lower unemployment rate than Texas over the past decade. It is anticipated that the Denton County economy will improve and employment will grow, strengthening the demand for real estate. Denton County Area Analysis 16 Parcel 1 Area Map Surrounding Area Analysis 17 Parcel 1 Surrounding Area Analysis The subject is located in the eastern portion of Denton County, within the northern portion of the Dallas-Fort Worth, TX metroplex. This area is part of the Denton submarket. Adjacent communities include Pilot Point to the north, Lewisville to the east, Argyle to the south, and Ponder to the west. Area boundaries and delineation are indicated in the following table. A map identifying the location of the property follows this section. Surrounding Area Analysis 18 Parcel 1 Access and Linkages Access throughout the area is considered excellent. The subject capitalizes on the Dallas-Fort Worth Metro Highway System, which is one of the most well-developed highway systems in the country. Primary access and linkages to the subject area, including highways, roadways, and airports, are summarized in the following table. Interstate Highways (Blue), Principal Arterial Freeways and Expressways (Red) and Principal Arterial Highways and thoroughfares (Green and Orange). The arrow indicates the approximate location of the subject. Surrounding Area Analysis 19 Parcel 1 Demand Generators The typical generators of demand affecting the subject property and its market are discussed and analyzed below. The University of North Texas (UNT) is a public research university in Denton, Texas. It consists of 14 colleges and schools, an early admissions math and science academy, Texas Academy of Mathematics and Science, for exceptional high-school-age students from across the state, and a library system that comprises the university core. The university is classified among "R1: Doctoral Universities – Very high research activity". According to the National Science Foundation, UNT spent $78.4 million on research and development in 2019. UNT was founded as a nonsectarian, coeducational, private teachers’ college in 1890 and was formally adopted by the state 11 years later. UNT is the flagship institution of the University of North Texas System, which includes additional universities in Dallas and Fort Worth. UNT also has a location in Frisco. The Denton Town Square (commonly called The Square) is Denton's largest social center. At its center stands the old Courthouse on the Square, which is Denton's most distinctive landmark, and is surrounded by antique shops, coffee houses, bars, clubs, restaurants, and music venues. The square has a myriad of businesses on and around it – including the Abbey Inn, Andy’s Bar and Hooligans. Many of these buildings are historic. The square is located only a few miles from the University of North Texas. Source: https://www.discoverdenton.com/things-to-do/attractions/downtown-square/ Texas Motor Speedway is a speedway located in the northernmost portion of the U.S. city of Fort Worth, Texas – the portion located in Denton County, Texas. The reconfigured track measures 1.44 miles (2.32 km) with banked 20° in turns 1 and 2 and banked 24° in turns 3 and 4. Texas Motor Speedway is a quad-oval design, where the front straightaway juts outward slightly. The track layout is similar to Atlanta Motor Speedway and Charlotte Motor Speedway. The track is owned by Speedway Motorsports, Inc. Source: https://www.texasmotorspeedway.com/ Alliance Center is a planned community located within Denton County and Tarrant County, Texas, United States. It includes parts of the cities of Haslet, Fort Worth, Westlake, Northlake, Denton, and Roanoke. It is currently owned by Hillwood, a Henry Ross Perot, Jr. company. It is home to an Alliance Business Development which branches of more than 500 companies of which 69 are Fortune 500 corporations as of Dec. 2018. The total private investment as of December 2018 is $9,036,738,025, with the total public investment totaling $775,380,929 as of December 2018. Alliance companies employ 61,602 people of various positions. In additional to the extensive business development, there is also an Alliance Residential and Commercial called Alliance Town Center which is the heart of activity for the rapidly growing Alliance region. Stretching from North Tarrant Parkway to Golden Triangle Boulevard, Alliance Town Center is a vibrant community, anchored by a robust Surrounding Area Analysis 20 Parcel 1 health and wellness district, and energized by a variety of shopping, dining, and entertainment options, programmed with family-friendly activities for every age and interest. The development’s smart growth, sustainable blueprint was recognized by the U.S. Green Building Council as one of two developments in Texas to receive the LEED Certified Neighborhood Development certification – one of the most difficult sustainable designations to obtain. Lastly, the development includes Circle T Ranch which is a 2,500-acre development seamlessly integrated with the most scenic landscapes in North Texas. Centrally located and connected within the Dallas-Fort Worth Metroplex and only 12 miles west of DFW International Airport, Circle T Ranch is one of nation’s most prominent corporate destinations. Also home to a highly crafted mixed-use development, private residences, and an award-winning golf course, Circle T Ranch fosters community engagement and facilitates active lifestyles. A planned preserve that will include an organic farm, greenhouse, and farm-to-table bistros, will further enhance the unique experience of parks, trails and open spaces winding through prairies and ranch lands with herds of roaming cattle. Source: https://www.alliancetexas.com/ Employment and Employment Centers In addition to its strong employment base, the area is easily accessible to the Frisco and North Tarrant submarkets, both within 30 minutes driving time. Access to employment centers in other submarkets is a major demand driver. Nearby residential communities and the University of North Texas provide a reliable source of college graduates, skilled workers and technical personnel. The subject is located within a vibrant Downtown/Main Street district that serves a densely populated trade area with average household income levels. Adjacent retail uses include a mix of retail stores, restaurants, and personal service establishments that draw customers to the area. The clustering of these uses creates a significant gravitational pull that benefits the subject. Demographics A demographic profile of the surrounding area, including population, households, and income data, is presented in the following table. Surrounding Area Analysis 21 Parcel 1 As shown above, the current population within a 10-minute drive time of the subject is 66,348, and the average household size is 2.5. Population in the area has grown since the 2020 census, and this trend is projected to continue over the next five years. Compared to Denton County overall, the population within a 10-minute drive time is projected to grow at a slower rate. Median household income is $76,017, which is lower than the household income for Denton County. Residents within a 10-minute drive time have a lower level of educational attainment than those of Denton County, while median owner-occupied home values are considerably lower. Services and Amenities The subject is served by the Denton Independent School District. Typical public services, including police and fire departments are provided by the City of Denton. The closest colleges and universities are The University of North Texas and Texas Women’s University. They offer most standard education programs, as well as various continuing education programs. Proximity to parks, golf courses, and other recreational activities is average. Land Use Predominant land uses in the immediate vicinity of the subject are primarily residential in nature. Development Activity and Trends During the last five years, development has been predominantly of residential and urban commercial uses. Surrounding Area Analysis 22 Parcel 1 Outlook and Conclusions The area is in the growth stage of its life cycle. Given the history of the area and the growth trends, it is anticipated that property values will remain stable in the near future and increase long term. In comparison to other areas in the region, the area is rated as follows: Surrounding Area Analysis 23 Parcel 1 Surrounding Area Map Land Description and Analysis 24 Parcel 1 Property Analysis Land Description and Analysis Land Description Land Area 2.1354 acres; 93,018 SF Part to be Acquired (Right of Way Acquisition)0.1827 acres; 7,957 SF Part to be Acquired (Drainage Easement)0.1036 acres; 4,512 SF Source of Land Area Public Records Primary Street Frontage Country Club Rd Shape Rectangular Corner Yes Rail Access No Topography Generally level and at street grade Drainage No problems reported or observed Environmental Hazards None reported or observed Ground Stability No problems reported or observed Flood Area Panel Number 48121C0370G Date April 18, 2011 Zone A Description Within 100-year floodplain Insurance Required?Yes Zoning; Other Regulations Zoning Jurisdiction City of Denton Zoning Designation R2 Description Residential Legally Conforming?Appears to be legally conforming Zoning Change Likely?No Permitted Uses Single-family detached dwellings, townhomes, and duplexes Minimum Lot Area 16,000 SF Minimum Lot Width (Feet)80' Minimum Lot Depth (Feet)100' Minimum Setbacks (Feet)20' Maximum Building Height 40' Maximum Site Coverage 0.4 Other Land Use Regulations None reported or observed Utilities Service Provider Water City of Denton Sewer City of Denton Electricity Oncor Natural Gas Atmos Local Phone AT&T We are not experts in the interpretation of zoning ordinances. An appropriately qualified land use attorney should be engaged if a determination of compliance with zoning is required. Flood Zone As seen in the flood map that follows this section, approximately 50% of the subject property is encumbered by the flood zone. We have taken into consideration the subject’s flood zone in the sales comparison approach. Land Description and Analysis 25 Parcel 1 Easements, Encroachments and Restrictions We are not aware of any easements, or encroachments, or restrictions that would adversely affect value. This valuation assumes no adverse impacts from easements, encroachments, or restrictions, and further assumes that the subject has clear and marketable title. Improvements The property is improved with a single-family residence and related site improvements including a shed. The main improvements are not affected from the acquisition and have not been included in this analysis. Improvements located within the part acquired include approximately 230 square feet of gravel pavement. Conclusion of Site Analysis Overall, the physical characteristics and the availability of utilities result in a functional site, suitable for a variety of uses including those permitted by zoning. Uses permitted by zoning include single- family detached dwellings, townhomes, and duplexes. No other restrictions on development are apparent. Land Description and Analysis 26 Parcel 1 View of acquisition facing northeast View facing east on Ryan Road View of acquisition facing northeast View of acquisition facing north View of acquisition facing north View of acquisition facing north Land Description and Analysis 27 Parcel 1 Aerial Photograph Land Description and Analysis 28 Parcel 1 Tax Map The subject is outlined in yellow above. Land Description and Analysis 29 Parcel 1 Flood Hazard Map Land Description and Analysis 30 Parcel 1 Zoning Map Real Estate Taxes 31 Parcel 1 Real Estate Taxes The subject is located in Denton County and assessed by the Denton County Appraisal District. Real estate taxes in this state and this jurisdiction represent ad valorem taxes, meaning a tax applied in proportion to value. The real estate taxes for an individual property may be determined by dividing the assessed value for a property by $100, then multiplying the estimate by the composite rate. The composite rate is based on a consistent state tax rate throughout the state, in addition to one or more local taxing district rates. Real estate taxes and assessments for the current tax year are shown in the following table. Taxes and Assessments - 2025 Assessed Value Taxes and Assessments Tax ID Land Improvements Total Tax Rate Ad Valorem Taxes Total 39123 $187,834 $123,309 $311,143 1.930189%$6,006 $6,006 We were unable to confirm the 2025 tax rate for the subject property. The tax rate indicated above is for 2024 and is believed to be consistent with the 2025 tax rate. Based on the concluded market value of the subject site, the assessed value appears low, however, it is consistent with assessed values of surrounding similar properties and is considered reasonable. Highest and Best Use 32 Parcel 1 Highest and Best Use The highest and best use of a property is the reasonably probable use resulting in the highest value, and represents the use of an asset that maximizes its productivity. Process Before a property can be valued, an opinion of highest and best use must be developed for the subject site, both as though vacant, and as improved or proposed. By definition, the highest and best use must be: • Physically possible. • Legally permissible under the zoning regulations and other restrictions that apply to the site. • Financially feasible. • Maximally productive, i.e., capable of producing the highest value from among the permissible, possible, and financially feasible uses. As Though Vacant First, the property is evaluated as though vacant, with no improvements. Physically Possible The site is 2.14 acres or 93,018 square feet of land located in the city of Denton within Denton County. The site is rectangular in shape and generally level and at street grade. Approximately 50% of the subject is located within Flood Zone A. The flood zone area bisects the subject site and may impact potential development within its boundaries. However, there is sufficient area not located in the flood zone for residential development. Legally Permissible The site is zoned R2, Residential. Permitted uses include single-family detached dwellings, townhomes, and duplexes. There are no apparent legal restrictions, such as easements or deed restrictions, effectively limiting the use of the property. Given prevailing land use patterns in the area, only residential use is given further consideration in determining highest and best use of the site, as though vacant. Financially Feasible Based on the accompanying analysis of the market, there is currently adequate demand for residential use in the subject’s area. It appears a newly developed residential use on the site would have a value commensurate with its cost. Therefore, residential use is considered to be financially feasible. Maximally Productive There does not appear to be any reasonably probable use of the site that would generate a higher residual land value than residential use. Accordingly, residential use, developed to the normal market density level permitted by zoning, is the maximally productive use of the property. Highest and Best Use 33 Parcel 1 Conclusion Development of the site for residential use is the only use which meets the four tests of highest and best use. Therefore, it is concluded to be the highest and best use of the property as though vacant. As Improved The subject of this report is improved with a single-family residence and related site improvements including a shed. The main improvements are not affected by the acquisition and have not been included in this analysis. Most Probable Buyer Taking into account the size and characteristics of the property and its occupancy, the likely buyer is an owner-user. Valuation Methodology 34 Parcel 1 Valuation Valuation Methodology Appraisers usually consider three approaches to estimating the market value of real property. These are the cost approach, sales comparison approach and the income capitalization approach. The cost approach assumes that the informed purchaser would pay no more than the cost of producing a substitute property with the same utility. This approach is particularly applicable when the improvements being appraised are relatively new and represent the highest and best use of the land or when the property has unique or specialized improvements for which there is little or no sales data from comparable properties. The sales comparison approach assumes that an informed purchaser would pay no more for a property than the cost of acquiring another existing property with the same utility. This approach is especially appropriate when an active market provides sufficient reliable data. The sales comparison approach is less reliable in an inactive market or when estimating the value of properties for which no directly comparable sales data is available. The sales comparison approach is often relied upon for owner-user properties. The income capitalization approach reflects the market’s perception of a relationship between a property’s potential income and its market value. This approach converts the anticipated net income from ownership of a property into a value indication through capitalization. The primary methods are direct capitalization and discounted cash flow analysis, with one or both methods applied, as appropriate. This approach is widely used in appraising income-producing properties. Reconciliation of the various indications into a conclusion of value is based on an evaluation of the quantity and quality of available data in each approach and the applicability of each approach to the property type. The methodology employed in this assignment is summarized as follows: Approaches to Value Approach Applicability to Subject Use in Assignment Cost Approach Not Applicable Not Utilized Sales Comparison Approach Applicable Utilized Income Capitalization Approach Not Applicable Not Utilized Sales Comparison Approach 35 Parcel 1 Sales Comparison Approach To develop an opinion of the subject’s land value, as if vacant and available to be developed to its highest and best use, we utilize the sales comparison approach. This approach develops an indication of value by researching, verifying, and analyzing sales of similar properties. To apply the sales comparison approach, we searched for sale transactions within the following parameters: • Location: Denton County • Size: 0.30 acres – 20.00 acres • Use: Vacant residential land • Transaction Date: 2022+ For this analysis, we use price per square foot as the appropriate unit of comparison because market participants typically compare sale prices and property values on this basis. The most relevant sales are summarized in the following table. Summary of Comparable Land Sales No.Name/Address Sale Date; Status Effective Sale Price SF; Acres Zoning $/SF Land $/Acre 1 825 E Ryan Road Oct-22 $175,000 35,545 R2 $4.92 $214,461 825 E. Ryan Rd. Closed 0.82 Denton Denton County TX 2 1.04-Acre Residential Lot, Denton, TX Feb-23 $170,000 45,302 R1 $3.75 $163,462 4505 State School Road Closed 1.04 Denton Denton County TX 3 5.55 Acres on State School Road Aug-24 $1,185,000 241,849 PD-MN $4.90 $213,433 State School Rd. Closed 5.55 Denton Denton County TX 4 Land - 6.4712 Acres Apr-23 $1,100,000 281,885 R3 $3.90 $169,984 Southwest side of Helm Lane, north of Spinnaker Drive Closed 6.47 Denton Denton County TX Subject 93,018 R2 Parcel 1 2.14 Denton, TX Comments: This property consists of 0.816 acres of vacant land, located on the north side of Ryan Road in Denton, TX. The property was sold on 10/31/2022 for $175,000 or $4.92/SF. Comments: This residential lot is located in the Denton ISD in the city limits of Denton, Texas. Comments: Property reportedly sold for $1,185,000 or $4.90 PSF. Comments: This rectangular-shaped property was acquired for future residential development. Zoning requires a minimum lot size of 10,000 square feet with an estimated density of 3.0 units per acre (19 lots). This property is within the Denton ISD. Sales Comparison Approach 36 Parcel 1 Comparable Land Sales Map Sales Comparison Approach 37 Parcel 1 Sale 1 825 E Ryan Road Sale 2 1.04-Acre Residential Lot, Denton, TX Sale 3 5.55 Acres on State School Road Sale 4 Land - 6.4712 Acres Sales Comparison Approach 38 Parcel 1 Analysis and Adjustments of Sales Adjustments are based on a rating of each comparable sale in relation to the subject. The adjustment process is typically applied through either quantitative or qualitative analysis, or a combination of both analyses. Quantitative adjustments are often developed as dollar or percentage amounts, and are most credible when there is sufficient data to perform a paired sales analysis. While percentage adjustments are presented in the adjustment grid, they are based on qualitative judgment rather than empirical research, as there is not sufficient data to develop a sound quantitative estimate. Although the adjustments appear to be mathematically precise, they are merely intended to illustrate an opinion of typical market activity and perception. With the exception of market conditions, the adjustments are based on a scale, with a minor adjustment in the range of 1- 5% and a substantial adjustment considered to be 20% or greater. The rating of each comparable sale in relation to the subject is the basis for the adjustments. If the comparable is superior to the subject, its sale price is adjusted downward to reflect the subject’s relative attributes; if the comparable is inferior, its price is adjusted upward. Transactional adjustments are applied for property rights conveyed, financing, conditions of sale, expenditures made immediately after purchase, and market conditions. In addition, property adjustments include – but are not limited to – location, access/exposure, size, quality, effective age, economic and legal characteristics, and non-realty components of value. Adjustments are considered for the following factors, in the sequence shown below. Transactional Adjustments Real Property Rights Conveyed The opinion of value in this report is based on a fee simple estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat, as well as non-detrimental easements, community facility districts, and conditions, covenants and restrictions (CC&Rs). All the comparables represent fee simple estate transactions. Therefore, adjustments for property rights are not necessary. Financing Terms In analyzing the comparables, it is necessary to adjust for financing terms that differ from market terms. Typically, if the buyer retained third-party financing (other than the seller) for the purpose of purchasing the property, a cash price is presumed and no adjustment is required. However, in instances where the seller provides financing as a debt instrument, a premium may have been paid by the buyer for below-market financing terms, or a discount may have been demanded by the buyer if the financing terms were above market. The premium or discounted price must then be adjusted to a cash equivalent basis. The comparable sales represented cash-to-seller transactions and, therefore, do not require adjustment. Sales Comparison Approach 39 Parcel 1 Conditions of Sale Adverse conditions of sale can account for a significant discrepancy from the sale price actually paid, compared to that of the market. This discrepancy in price is generally attributed to the motivations of the buyer and the seller. Certain conditions of sale are considered non-market and may include the following: • a seller acting under duress (e.g., eminent domain, foreclosure); • buyer motivation (e.g., premium paid for assemblage, certain 1031 exchanges); • a lack of exposure to the open market; • an unusual tax consideration; • a sale at legal auction. None of the comparable sales had atypical or unusual conditions of sale. Thus, adjustments are not necessary. Expenditures Made Immediately After Purchase This category considers expenditures incurred immediately after the purchase of a property. There were no issues of deferred maintenance reported for any of the properties. No adjustments are required for expenditures after sale. Market Conditions A market conditions adjustment is applied when market conditions at the time of sale differ from market conditions as of the effective date of value. Adjustments can be positive when prices are rising, or negative when markets are challenged by factors such as a deterioration of the economy or adverse changes in supply and/or demand in the market area. Consideration must also be given to when the property was placed under contract, versus when the sale actually closed. In evaluating market conditions, changes between the comparable sale date and the effective date of this appraisal may warrant adjustment; however, if market conditions have not changed, then no adjustment is required. The sales took place from October 2022 to August 2024. Market conditions have generally been strengthening. The adjustment grid accounts for this trend with upward adjustments over this period through the effective date of value. Property Adjustments Location Factors considered in evaluating location include, but are not limited to, demographics, growth rates, surrounding uses and property values. All of the comparables are similar to the subject. No adjustments are necessary. Sales Comparison Approach 40 Parcel 1 Access/Exposure Convenience to transportation facilities, ease of site access, and overall visibility of a property can have a direct impact on property value. High visibility, however, may not translate into higher value if it is not accompanied by good access. In general, high visibility and convenient access, including proximity to major linkages, are considered positive amenities when compared to properties with inferior attributes. The subject property has a corner location with frontage along two thoroughfares. Sale 3 is similar to the subject and requires no adjustment. Sales 1, 2, and 4 are inferior to the subject. Upward adjustments are applied. These sales do not have corner locations. Size Due to economies of scale, the market exhibits an inverse relationship between land area and price per square foot, such that larger sites generally sell for a lower price per square foot than smaller lots, all else being equal. To account for this relationship, applicable adjustments are applied for differences in land area. The comparables that are larger than the subject are adjusted upward, and vice versa. Sales 1 and 2 are smaller than the subject, and downward adjustments are applied. Sales 3 and 4 are larger than the subject and require upward adjustments. Shape and Topography This category accounts for the shape of the site influencing its overall utility and/or development potential, as well as the grade of the land. All of the comparables are similar to the subject. No adjustments are necessary. Zoning This element of comparison accounts for government regulations that can affect the types and intensities of uses allowable on a site. Moreover, this category includes considerations such as allowable density or floor area ratio, structure height, setbacks, parking requirements, landscaping, and other development standards. The subject has a zoning designation of R2 - Residential. Sales 1 and 2 are similar to the subject and require no adjustment. Sales 3 and 4 are superior to the subject. Downward adjustments are applied. Sale 4 permits development of smaller lots and Sale 3 permits commercial and residential uses. Flood Plain This element of comparison accounts for the amount of a site encumbered by flood plain and how it can affect the development potential. All of the comparables are superior to the subject. Downward adjustments are applied. Sales Comparison Approach 41 Parcel 1 Adjustments Summary The sales are compared to the subject and adjusted to account for material differences that affect value. The following table summarizes the adjustments applied to each sale. Land Sales Adjustment Grid Subject Comparable 1 Comparable 2 Comparable 3 Comparable 4 Name Parcel 1 825 E Ryan Road 1.04-Acre Residential Lot, Denton, TX 5.55 Acres on State School Road Land - 6.4712 Acres Address 3865 Country Club Road 825 E. Ryan Rd. 4505 State School Road State School Rd. Southwest side of Helm Lane, north of Spinnaker Drive City Denton Denton Denton Denton Denton County Denton Denton Denton Denton Denton State Texas TX TX TX TX Sale Date Oct-22 Feb-23 Aug-24 Apr-23 Sale Status Closed Closed Closed Closed Sale Price $175,000 $170,000 $1,185,000 $1,100,000 Price Adjustment –––– Description of Adjustment Effective Sale Price $175,000 $170,000 $1,185,000 $1,100,000 Square Feet 93,018 35,545 45,302 241,849 281,885 Acres 2.14 0.82 1.04 5.55 6.47 Price per Square Foot $4.92 $3.75 $4.90 $3.90 Transactional Adjustments Property Rights Fee Simple Fee Simple Fee Simple Fee Simple % Adjustment –––– Financing Terms Cash to seller Cash to seller Cash to seller Cash to seller % Adjustment –––– Conditions of Sale Arm's-length Arm's-length Arm's-length Arm's-length % Adjustment –––– Expenditures Made Immediately After Purchase $ Adjustment –––– Market Conditions 4/18/2025 Oct-22 Feb-23 Aug-24 Apr-23 Annual % Adjustment 5%12%11%3%10% Cumulative Adjusted Price $5.51 $4.17 $5.05 $4.29 Property Adjustments Location –––– Access/Exposure 5%5%–5% Size -15%-5%10%10% Shape and Topography –––– Zoning ––-10%-10% Flood Plain -5%-5%-5%-5% Easements –––– Net Property Adjustments ($)-$0.83 -$0.21 -$0.25 $0.00 Net Property Adjustments (%)-15%-5%-5%0% Final Adjusted Price $4.69 $3.96 $4.79 $4.29 Range of Adjusted Prices $3.96 - $4.79 Average $4.43 Indicated Value $4.50 Sales Comparison Approach 42 Parcel 1 Land Value Conclusion Prior to adjustments, the sales reflect a range of $3.75 - $4.92 per square foot. After adjustment, the range is narrowed to $3.96 - $4.79 per square foot, with an average of $4.43 per square foot. To arrive at an indication of value, primary weight is given to the mean. The following table summarizes the conclusion of land value for the subject property. Land Value Conclusion Indicated Value PSF (Fee Simple Area)$4.50 Fee Simple Area 93,018 Total Value $418,581 Cost Approach 43 Parcel 1 Cost Approach The steps taken to apply the cost approach are: • Develop an opinion of the value of the land as though vacant and available to be developed to its highest and best use, as of the effective date of the appraisal; • Estimate the replacement cost new of the existing improvements under current market conditions; • Estimate depreciation from all causes and deduct this estimate from replacement cost new to arrive at depreciated replacement cost of the improvements; and • Add land value to the depreciated replacement cost of the improvements to arrive at a market value indication for the property overall. Replacement Cost Replacement cost is the estimated cost to construct, at current prices as of a specified date, a substitute for a building or other improvement, using modern materials and current standards, design, and layout. Estimates of replacement cost for the purpose of developing a market value opinion include three components: direct costs, indirect costs (also known as soft costs) and entrepreneurial incentive. Direct Costs Direct costs are expenditures for labor, materials, equipment and contractor’s overhead and profit. Marshall Valuation Service (MVS) and contractor quotes is used as the basis of the direct cost estimate. In addition to direct costs, MVS includes certain indirect costs such as architectural and engineering fees, and interest on building loan funds during construction. Typically, contractor quotes include all indirect costs as well. The following table shows the source for each cost component included in this valuation. Replacement Cost New Sources Improvement Cost New Source Gravel Paving XIT Paving & Construction, INC. Indirect Costs MVS does not include all of the indirect costs that are appropriate in a replacement cost estimate. Therefore, an allowance is added for the following indirect costs that are not contained within MVS: taxes and carrying costs on land during construction; legal and accounting fees; and marketing and finance costs prior to stabilization. Unless specifically noted, contractor quotes include indirect costs. It is estimated that a 10% allowance for additional indirect costs is appropriate. Cost Approach 44 Parcel 1 Entrepreneurial Incentive Entrepreneurial incentive is the financial reward that a developer would expect to receive in addition to recovering all direct and indirect costs. This is the expected compensation that would be necessary to motivate a developer to undertake the project. Entrepreneurial incentive for similar properties typically ranges from 10% to 20%. An estimate of 15% is applied to the total replacement costs used in this analysis. Replacement Cost The following table shows the replacement cost estimate for the subject’s improvements. Depreciation Depreciation is the difference between the replacement cost new of the improvements and their contribution to overall property value on the effective date of the appraisal. There are three major causes of depreciation: 1. Physical deterioration: The loss in value due to the wear and tear that begins when a building is completed and placed into service. Physical deterioration can be curable (referred to as deferred maintenance) or incurable. 2. Functional obsolescence: The loss in value due to changes in market tastes and standards. Similar to physical deterioration, functional obsolescence can be curable or incurable. 3. External obsolescence: The loss in value due to negative external influences. These influences can be temporary or permanent, and are generally incurable by the owner, landlord, or tenant. There are three principal methods of estimating depreciation: the market extraction method, the economic age-life method, and the breakdown method. The economic age-life method is used in this analysis. Economic Age-Life Method In the economic age-life method, depreciation is estimated by dividing the effective age of the improvements by the total economic life. This method results in a lump sum estimate for all depreciation, including the loss in value from all physical, functional and external obsolescence. Final Estimate of Depreciation Estimates of depreciation for each component are shown in the following table. Estimated Replacement/Reproduction Cost Improvement Number of Units $ per unit Cost New Value $ Contributory Value of the Buildings $0 Accessory Improvements $ Contributory Value of the Accessory Improvements $0 Site Improvements Gravel Paving 230 SF @ $2.88 /SF =$662 ($331)(50%)$331 $ $ Contributory Value of the Site Improvements $331 Contributory Value of All Improvements $331 <Depreciation> Cost Approach 45 Parcel 1 Improvement Depreciation Estimates Improvement Effective Economic % Depreciated Gravel Paving 10 /20 =50% Stop Depreciation is estimated based on the actual age of the improvements as well as their observed quality and condition during the inspection. The economic life for the improvements is estimated based on observed economic lives for similar properties as well as information from the Marshall Valuation Service. Value Indication The Cost Approach conclusion is presented in the following table. Cost Approach Conclusion Land $418,581 Plus: Depreciated Value of Improvements +$331 Concluded Value - Cost Approach $418,912 Stop Part Acquired 46 Parcel 1 Part Acquired The following portion of the appraisal process deals directly with the valuation of the subject part acquired. The part acquired is the portion of the subject that is acquired by eminent domain from the whole property. The valuation of the part acquired is predicated on the market value of the property prior to any acquisition and excludes the influence of the subject project. Partial Acquisition Description The acquisition is rectangular in shape and consists of 0.1827 acres (7,957 SF) of land. The acquisition is located along the southern boundary of the subject whole property with frontage along West Ryan Road and Country Club Road. Improvements located within the part acquired include approximately 230 square feet of gravel pavement. The drainage easement is an area of 0.1036 acres, or 4,512 square feet of land located along the north edge of the right-of-way acquisition in the southeast portion of the site. There are no improvements located within the drainage easement. Part Acquired 47 Parcel 1 Aerial Photograph The Whole Property is outlined in red, the Right of Way acquisition is outlined in yellow, and the drainage easement is outlined in blue. Economic Unit 1 Economic Unit 2 Part Acquired Survey - Parcel 1 48 Parcel 1 Part Acquired Survey - Parcel 1 Part Acquired Survey - Parcel 1 Drainage Easement 49 Parcel 1 Part Acquired Survey - Parcel 1 Drainage Easement Economic Unit The acquisition is not an appropriate size to be considered an economic unit on its own; therefore, it is appraised as if used in conjunction with the remainder to form an economic unit that yields the highest net return to the land. In order to take full advantage of the physical characteristics of the subject property, the part to be acquired is used in conjunction with the Remainder After (the size of the Whole Property). The economic unit meets all the tests of highest and best use of the subject property as discussed below. Highest and Best Use – Part Acquired Highest and best use may be defined as that reasonably probable and legal use of vacant land or improved property that is physically possible, appropriately supported, and financially feasible that results in the highest value. The four tests to develop adequate support for an opinion of highest and best use, applied in order, are legal permissibility, physical possibility, financial feasibility, and maximum productivity. Valuation Methodology 50 Parcel 1 As Vacant Analysis – Part Acquired Due to its limited size, the area of the partial acquisition could not stand alone as a separate and independent economic unit. The partial acquisition’s use is essentially limited to use in conjunction with the whole property. As such, the highest and best use of the part acquired, as vacant, is for use in conjunction with the subject whole property. As Improved Analysis – Part Acquired The highest and best use of the part acquired, as improved, is the same as that of the subject whole property. Valuation Methodology In this instance, the subject part acquired consists of land and site improvements. As an integral part of the whole property, the part acquired shares the same physical and economic characteristics. Because the highest and best use of the part acquired is for use in conjunction with the subject whole property, the part acquired shares the same per unit land value concluded in the valuation of the subject whole property and applied in the valuation of the part acquired. The calculation of the value of the part acquired is summarized in the following reconciliation discussion. Land Value - Part Acquired Since the economic unit analyzed to derive a value estimate for the Part Acquired is the same size as the subject Whole Property, the same set of land sales are utilized in estimating the value of the Part Acquired as were used in the analysis of the Whole Property. Therefore, the value of the Part Acquired is estimated at $4.50 per square foot. Since the subject acquisition includes an easement as well as a fee simple acquisition, a percentage of the fee simple interest will remain with the property owner after the acquisition. Easement Valuation Matrix As noted, the part to be acquired contains fee acquisitions and easement areas. The following chart (Right of Way Magazine, “Easement Valuation”, Sherwood, May 2006) outlines a very basic analysis of typical easement encumbrances. It can be used as a generic guide to analyze the extent of ownership the fee owner loses as a result of the encumbrance brought about by an easement. Valuation Methodology 51 Parcel 1 The subject Part Acquired includes a proposed drainage easement. Therefore, a reasonable percentage of the fee value attributable to the easement is 75% to 90%, leaving 25% to 10% of the fee value with the property owner. In this case, 90% of the fee value has been attributed to the easement. The following table presents the total value of the part acquired. Value of the Part Acquired $54,412 By Sales Comparison Approach - Drainage Easement Easement $4.50 x 4,512 SF x 90%=$18,274 By Sales Comparison Approach - PTA Fee Simple $4.50 X 7,957 SF X 100%=$35,807 Value of Improvements located within PTA =$331 Remainder Before the Acquisition 52 Parcel 1 Remainder Before the Acquisition The indicated value of the remainder before the acquisition is derived by deducting the estimated value of the acquisition from the value of the whole property. The calculations are as follows: Value of the Whole Property $418,912 By Sales Comparison Approach - Land Fee Simple $4.50 x 93,018 SF x 100%=$418,581 By Cost Approach $418,912 By Sales Comparison Approach - Improved N/A By Income Capitalization Approach N/A Value of the Part Acquired $54,412 By Sales Comparison Approach - Drainage Easement Easement $4.50 x 4,512 SF x 90%=$18,274 By Sales Comparison Approach - PTA Fee Simple $4.50 X 7,957 SF X 100%=$35,807 Value of Improvements located within PTA =$331 Value of the Remainder Before $364,500 Analysis of the Remainder After The value of the Remainder After is appraised independently and takes into consideration the effect the subject acquisition has on the remainder. This estimate is based upon a new site analysis, highest and best use analysis, as well as the employment of the three approaches to value, where applicable. Damages or enhancements to the remainder are calculated by subtracting the value of the Remainder After from the value of the Remainder Before the acquisition. If the calculation is positive, damages exist. However, if the figure is negative enhancements are present. If an enhancement exists, it is noted; however, enhancements are not deducted from the total compensation. In the case of the subject property, an enhancement exists because the remainder after does not contain square feet within the existing right of way. Property Description - Remainder After The proposed acquisition extends approximately 534 feet along the subject’s southern boundary and is approximately 14 to 19 feet deep. The subject property consists of a shed with approximately 540 square feet that is not located within the acquisition, however, will need to be moved due to its proximity to the new right-of-way line. We have included demolition costs and replacement costs for the shed in our cost to cure. The acquisition does not alter the development utility of the site, nor does it restrict access to the site. As such, the utility and development potential of the Remainder is the same as the before. Cost to Cure 53 Parcel 1 Highest and Best Use - Remainder After – As If Vacant Since the Remainder After is an economic unit similar to the Whole Property, the highest and best use of the Remainder After and the subject Whole Property is the same. Value of the Remainder After the Acquistion $364,500 By Sales Comparison Approach Fee Simple $4.50 x 80,549 SF x 100%=$362,471 $4.50 x 4,512 SF x 10%=$2,030 Reconciliation $364,500 Cost to Cure The value conclusion in the part acquired included an estimate of compensation due to the property owner(s) for the value of the improvements within the acquisition parcel. However, replacement improvements must be purchased and replaced using new construction components. The cost to cure is an estimate of additional financial compensation to restore the property to similar functional utility as exists prior to the acquisition. In order to avoid double compensation, the cost to cure is calculated as the difference between the replacement cost new and the previously estimated depreciated replacement cost of each individual component. The formula is as follows: Replacement Cost New – Depreciated Replacement Cost in Part Acquired = Cost to Cure This formula is applied to each of the components identified that require reconfiguration or replacement as a result of the acquisition. If the estimated value of the component included in the part acquired is higher than the cost to replace the component, then no further compensation is due for that component and the cost to cure is equal to $0 for that item. The dollar amounts are not deducted against a cumulative total, but rather calculated on an item-by-item basis. As previously stated, the subject property consists of a shed with approximately 540 square feet that is not located within the acquisition, however, will need to be moved due to its proximity to the new right- of-way line. We have included demolition costs and replacement costs for the shed in our cost to cure. The following is a summary of our cost to cure estimate. Cost to Cure Item No. of Units Cost New/Unit Cost New Less Part Acquired Cost to Cure Demolition of existing shed 540 SF @ $8.00 =$4,320 -$0 =$4,320 Replace existing shed 540 SF @ $18.70 =$10,098 -$0 =$10,098 Cost Contingency $14,418 x 10%=$1,442 Total Cost to Cure $15,860 Estimate of Compensation 54 Parcel 1 Estimate of Compensation Value of the Whole Property $418,912 By Sales Comparison Approach - Land Fee Simple $4.50 x 93,018 SF x 100%=$418,581 By Cost Approach $418,912 By Sales Comparison Approach - Improved N/A By Income Capitalization Approach N/A Value of the Part Acquired $54,412 By Sales Comparison Approach - Drainage Easement Easement $4.50 x 4,512 SF x 90%=$18,274 By Sales Comparison Approach - PTA Fee Simple $4.50 X 7,957 SF X 100%=$35,807 Value of Improvements located within PTA =$331 Value of the Remainder Before $364,500 Value of the Remainder After the Acquistion $364,500 By Sales Comparison Approach Fee Simple $4.50 x 80,549 SF x 100%=$362,471 $4.50 x 4,512 SF x 10%=$2,030 Reconciliation $364,500 Damages/Enhancements (Remainder Before - Remainder After)$0 Cost to Cure $15,860 Compensation $70,272 Estimate of Compensation 55 Parcel 1 Exposure Time Exposure time is the length of time the subject property would have been exposed for sale in the market had it sold on the effective valuation date at the concluded market value. Exposure time is always presumed to precede the effective date of the appraisal. Based on our review of recent sales transactions for similar properties and our analysis of supply and demand in the local market, it is our opinion that the probable exposure time for the subject at the concluded market values stated previously is 6-12 months. Marketing Time Marketing time is an estimate of the amount of time it might take to sell a property at the concluded market value immediately following the effective date of value. As we foresee no significant changes in market conditions in the near term, it is our opinion that a reasonable marketing period for the subject is likely to be the same as the exposure time. Accordingly, we estimate the subject’s marketing period at 6-12 months. Valuation 56 Parcel 1 Certification We certify that, to the best of our knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are our personal, impartial, and unbiased professional analyses, opinions, and conclusions. 3. We have no present or prospective interest in the property that is the subject of this report and no personal interest with respect to the parties involved. 4. We have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding the agreement to perform this assignment. 5. We have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. 6. Our engagement in this assignment was not contingent upon developing or reporting predetermined results. 7. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 8. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice as well as applicable state appraisal regulations. 9. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute. 10. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 11. Brent Pitts, MAI, AI-GRS, R/W-AC, and Mitchell L. Etter, M.Ed., have made personal inspections of the property that is the subject of this report. 12. No one provided significant real property appraisal assistance to the person(s) signing this certification. 13. We have experience in appraising properties similar to the subject and are in compliance with the Competency Rule of USPAP. Valuation 57 Parcel 1 14. As of the date of this report, Brent Pitts, MAI, AI-GRS, R/W-AC, has completed the continuing education program for Designated Members of the Appraisal Institution. Brent Pitts, MAI, AI-GRS, R/W-AC Texas Certified General Real Estate Appraiser #1380206 G Mitchell L. Etter, M.Ed. Texas Certified General Real Estate Appraiser #1381464 G Valuation 58 Parcel 1 Assumptions and Limiting Conditions This appraisal and any other work product related to this engagement are limited by the following standard assumptions, except as otherwise noted in the report: 1. The title is marketable and free and clear of all liens, encumbrances, encroachments, easements and restrictions. The property is under responsible ownership and competent management and is available for its highest and best use. 2. There are no existing judgments or pending or threatened litigation that could affect the value of the property. 3. There are no hidden or undisclosed conditions of the land or of the improvements that would render the property more or less valuable. Furthermore, there is no asbestos in the property. 4. The property is in compliance with all applicable building, environmental, zoning, and other federal, state and local laws, regulations and codes. 5. The information furnished by others is believed to be reliable, but no warranty is given for its accuracy. This appraisal and any other work product related to this engagement are subject to the following limiting conditions, except as otherwise noted in the report: 1. An appraisal is inherently subjective and represents our opinion as to the value of the property appraised. 2. The conclusions stated in our appraisal apply only as of the effective date of the appraisal, and no representation is made as to the effect of subsequent events. 3. No changes in any federal, state or local laws, regulations or codes (including, without limitation, the Internal Revenue Code) are anticipated. 4. No environmental impact studies were either requested or made in conjunction with this appraisal, and we reserve the right to revise or rescind any of the value opinions based upon any subsequent environmental impact studies. If any environmental impact statement is required by law, the appraisal assumes that such statement will be favorable and will be approved by the appropriate regulatory bodies. 5. Unless otherwise agreed to in writing, we are not required to give testimony, respond to any subpoena or attend any court, governmental or other hearing with reference to the property without compensation relative to such additional employment. 6. We have made no survey of the property and assume no responsibility in connection with such matters. Any sketch or survey of the property included in this report is for illustrative purposes only and should not be considered to be scaled accurately for size. The appraisal covers the property as described in this report, and the areas and dimensions set forth are assumed to be correct. Valuation 59 Parcel 1 7. No opinion is expressed as to the value of subsurface oil, gas or mineral rights, if any, and we have assumed that the property is not subject to surface entry for the exploration or removal of such materials, unless otherwise noted in our appraisal. 8. We accept no responsibility for considerations requiring expertise in other fields. Such considerations include, but are not limited to, legal descriptions and other legal matters such as legal title, geologic considerations such as soils and seismic stability; and civil, mechanical, electrical, structural and other engineering and environmental matters. Such considerations may also include determinations of compliance with zoning and other federal, state, and local laws, regulations and codes. 9. The distribution of the total valuation in the report between land and improvements applies only under the reported highest and best use of the property. The allocations of value for land and improvements must not be used in conjunction with any other appraisal and are invalid if so used. The appraisal report shall be considered only in its entirety. No part of the appraisal report shall be utilized separately or out of context. 10. Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or any reference to the Appraisal Institute) shall be disseminated through advertising media, public relations media, news media or any other means of communication (including without limitation prospectuses, private offering memoranda and other offering material provided to prospective investors) without the prior written consent of the persons signing the report. 11. Information, estimates and opinions contained in the report and obtained from third-party sources are assumed to be reliable and have not been independently verified. 12. Any income and expense estimates contained in the appraisal report are used only for the purpose of estimating value and do not constitute predictions of future operating results. 13. If the property is subject to one or more leases, any estimate of residual value contained in the appraisal may be particularly affected by significant changes in the condition of the economy, of the real estate industry, or of the appraised property at the time these leases expire or otherwise terminate. 14. Unless otherwise stated in the report, no consideration has been given to personal property located on the premises or to the cost of moving or relocating such personal property; only the real property has been considered. 15. The current purchasing power of the dollar is the basis for the values stated in the appraisal; we have assumed that no extreme fluctuations in economic cycles will occur. 16. The values found herein are subject to these and to any other assumptions or conditions set forth in the body of this report but which may have been omitted from this list of Assumptions and Limiting Conditions. 17. The analyses contained in the report necessarily incorporate numerous estimates and assumptions regarding property performance, general and local business and economic conditions, the absence of material changes in the competitive environment and other matters. Some estimates or assumptions, however, inevitably will not materialize, and unanticipated events and circumstances may occur; therefore, actual results achieved during Valuation 60 Parcel 1 the period covered by our analysis will vary from our estimates, and the variations may be material. 18. The Americans with Disabilities Act (ADA) became effective January 26, 1992. We have not made a specific survey or analysis of the property to determine whether the physical aspects of the improvements meet the ADA accessibility guidelines. We claim no expertise in ADA issues, and render no opinion regarding compliance of the subject with ADA regulations. Inasmuch as compliance matches each owner’s financial ability with the cost to cure the non- conforming physical characteristics of a property, a specific study of both the owner’s financial ability and the cost to cure any deficiencies would be needed for the Department of Justice to determine compliance. 19. The appraisal report is prepared for the exclusive benefit of you, your subsidiaries and/or affiliates. It may not be used or relied upon by any other party. All parties who use or rely upon any information in the report without our written consent do so at their own risk. 20. No studies have been provided to us indicating the presence or absence of hazardous materials on the subject property or in the improvements, and our valuation is predicated upon the assumption that the subject property is free and clear of any environment hazards including, without limitation, hazardous wastes, toxic substances and mold. No representations or warranties are made regarding the environmental condition of the subject property. IRR - Fort Worth , Integra Realty Resources, Inc., and their respective officers, owners, managers, directors, agents, subcontractors or employees (the “Integra Parties”), shall not be responsible for any such environmental conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because we are not experts in the field of environmental conditions, the appraisal report cannot be considered as an environmental assessment of the subject property. 21. The persons signing the report may have reviewed available flood maps and may have noted in the appraisal report whether the subject property is located in an identified Special Flood Hazard Area. However, we are not qualified to detect such areas and therefore do not guarantee such determinations. The presence of flood plain areas and/or wetlands may affect the value of the property, and the value conclusion is predicated on the assumption that wetlands are non-existent or minimal. 22. We are not a building or environmental inspector. The Integra Parties do not guarantee that the subject property is free of defects or environmental problems. Mold may be present in the subject property and a professional inspection is recommended. 23. The appraisal report and value conclusions for an appraisal assume the satisfactory completion of construction, repairs or alterations in a workmanlike manner. 24. IRR - Fort Worth is an independently owned and operated company. The parties hereto agree that Integra shall not be liable for any claim arising out of or relating to any appraisal report or any information or opinions contained therein as such appraisal report is the sole and exclusive responsibility of IRR - Fort Worth . In addition, it is expressly agreed that in any action which may be brought against the Integra Parties arising out of, relating to, or in any way pertaining to the engagement letter, the appraisal reports or any related work product, the Integra Parties shall not be responsible or liable for any incidental or Valuation 61 Parcel 1 consequential damages or losses, unless the appraisal was fraudulent or prepared with intentional misconduct. It is further expressly agreed that the collective liability of the Integra Parties in any such action shall not exceed the fees paid for the preparation of the assignment (unless the appraisal was fraudulent or prepared with intentional misconduct). It is expressly agreed that the fees charged herein are in reliance upon the foregoing limitations of liability. 25. IRR - Fort Worth is an independently owned and operated company, which has prepared the appraisal for the specific intended use stated elsewhere in the report. The use of the appraisal report by anyone other than the Client is prohibited except as otherwise provided. Accordingly, the appraisal report is addressed to and shall be solely for the Client’s use and benefit unless we provide our prior written consent. We expressly reserve the unrestricted right to withhold our consent to your disclosure of the appraisal report or any other work product related to the engagement (or any part thereof including, without limitation, conclusions of value and our identity), to any third parties. Stated again for clarification, unless our prior written consent is obtained, no third party may rely on the appraisal report (even if their reliance was foreseeable). 26. The conclusions of this report are estimates based on known current trends and reasonably foreseeable future occurrences. These estimates are based partly on property information, data obtained in public records, interviews, existing trends, buyer-seller decision criteria in the current market, and research conducted by third parties, and such data are not always completely reliable. The Integra Parties are not responsible for these and other future occurrences that could not have reasonably been foreseen on the effective date of this assignment. Furthermore, it is inevitable that some assumptions will not materialize and that unanticipated events may occur that will likely affect actual performance. While we are of the opinion that our findings are reasonable based on current market conditions, we do not represent that these estimates will actually be achieved, as they are subject to considerable risk and uncertainty. Moreover, we assume competent and effective management and marketing for the duration of the projected holding period of this property. 27. All prospective value opinions presented in this report are estimates and forecasts which are prospective in nature and are subject to considerable risk and uncertainty. In addition to the contingencies noted in the preceding paragraph, several events may occur that could substantially alter the outcome of our estimates such as, but not limited to changes in the economy, interest rates, and capitalization rates, behavior of consumers, investors and lenders, fire and other physical destruction, changes in title or conveyances of easements and deed restrictions, etc. It is assumed that conditions reasonably foreseeable at the present time are consistent or similar with the future. 28. The appraisal is also subject to the following: Valuation 62 Parcel 1 Extraordinary Assumptions and Hypothetical Conditions 1.All information relative to the subject property, including land areas and other pertinent data that was provided by the client and public records, is assumed to be correct. 2.It is assumed that there are no environmental issues that impact the use or value of the subject property. 3.The subject is appraised under the extraordinary assumption that there are no subsurface improvements located within the acquisition. 1.The project for which the acquisition is necessary is assumed to be complete and being fully utilized for purposes of estimating the value of the Remainder After the Acquisition, it is also assumed that the property is affected by the project similar to the community. If it becomes known that there are specific damages that affect the subject property that are not considered herin, this appraisal and its conclusion may be subject to reconsideration. The use of any extraordinary assumption or hypothetical condition may have affected the assignment results. The value conclusions are based on the following hypothetical conditions. A hypothetical condition is a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. The value conclusions are subject to the following extraordinary assumptions. An extraordinary assumption is an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions. Addenda Parcel 1 Addendum A Appraiser Qualifications Brent Pitts, MAI, AI-GRS, R/W-AC Integra Realty Resources - Fort Worth irr.com T 817.763.8000 F 817.763.8017 7080 Camp Bowie Boulevard Fort Worth, TX 76116 Experience Brent Pitts is a Managing Director with Integra Realty Resources - Fort Worth. Mr. Pitts has been involved in real estate valuation and advisory since early 2010 with a focus on right of way and eminent domain since 2011. He is a Certified General Appraiser and has prepared appraisals in numerous states. Mr. Pitts has experience in appraising all major categories of real estate, including land, retail, restaurant, industrial, gas stations, office, manufactured housing, self-storage, apartments, condominiums, automotive, hotels, religious facilities, single-family residences, subdivisions, timeshares, and various other special purpose properties. Valuation clients include government agencies, project management and engineering firms, insurance companies, brokers, law firms and attorneys, estates, and individuals. Brent has also appraised multiple properties for whole takings, partial takings, and easement acquisitions for condemnation proceedings with many of these appraisals requiring complex analyses and consideration of damages to the remainder. Brent has also qualified as an expert witness and testified in multiple administrative and commissioners hearings as well as in trial settings and holds the MAI and AI-GRS designations from the Appraisal Institute as well as the R/W-AC credential from the International Right of Way Association. Mr. Pitts currently serves as the President of the Central Texas Chapter of the Appraisal Institute. Licenses Texas, Certified General Real Estate Appraiser, 1380206 G, Expires January 2027 Education MAI Designation, Appraisal Institute AI-GRS Designation, Appraisal Institute International Right of Way Association - Chapter 36 President - Central Texas Chapter, Appraisal Institute (2024) Texas Tech University (2008) - Bachelor of Business Administration in Petroleum Land Management Texas Tech University Graduate School (2009) - Masters of Business Administration in Finance Numerous Appraisal Institute, International Right of Way Association, and other bpitts@irr.com - 817.763.8000 Brent Pitts, MAI, AI-GRS, R/W-AC Integra Realty Resources - Fort Worth irr.com T 817.763.8000 F 817.763.8017 7080 Camp Bowie Boulevard Fort Worth, TX 76116 Education (Cont'd) professional development courses. Qualified Before Courts & Administrative Bodies Texas | Kansas | Missouri | Oklahoma | Louisiana | Florida | Utah | Arizona | New Mexico Colorado | Georgia | North Carolina Miscellaneous Director, Real Estate - Kroll (Dallas, TX) - Served as Team Lead for National Right of Way Practice Valuation Services Director - Colliers International (Dallas, TX) Appraiser - Appraisal Source, Inc. (Fort Worth, TX) Appraiser - National Appraisal Partners, LLP (Houston, TX) bpitts@irr.com - 817.763.8000 Mr. Mitchell L. Etter Integra Realty Resources - Fort Worth irr.com T 817.763.8000 7080 Camp Bowie Blvd Fort Worth, TX 76116 Experience Mitchell Etter, M.Ed., is a State Certified General Real Estate Appraiser. He earned a Master of Education (2015) and a Bachelor of Education (2006) from Hardin-Simmons University in Abilene, Texas. After a 10-year teaching career, Mitchell began his appraisal career with Appraisal Source Inc., in Fort Worth, Texas. Mitchell has prepared appraisals in Texas, New Mexico, Oklahoma, Louisiana, and Arkansas. He has prepared appraisals for vacant land, farms, ranches (100 acres to 2,500 acres), retail properties, office/warehouse properties, storage/mini-storage properties, general, medical, and high-rise offices, office condominiums, restaurants, churches, museums, service stations, schools, and multi-family properties. Mitchell has prepared numerous going-concern valuations on motels/hotels, gas stations/convenience stores, marinas, car washes and special use properties. Mitchell has also appraised multiple properties for condemnation purposes with many requiring complex analyses and consideration of damages to the remainder. Additionally, Mitchell has worked on the Army Corps of Engineers United States Border Control Project in Texas’ Rio Grande Valley. Licenses Texas, Certified General Real Estate Appraiser, 1381464 G, Expires July 2026 Education Master of Education, Gifted Education, Hardin Simmons University, 2015. Bachelor of Education, Instrumental Music EC 12 (Piano), Hardin Simmons University, 2006 Completed Course Work and Continuing Education Basic Appraisal Principles Basic Appraisal Procedures National Uniform Standards of Professional Appraisal Practice Supervisor Trainee Course for Texas Real Estate Finance, Statistics, and Valuation Modeling General Appraiser Sales Comparison Approach General Appraiser Site Valuation and Cost Approach General Appraiser Income Approach/ Part 1 General Appraiser Income Approach/ Part 2 General Appraiser Report Writing and Case Studies Commercial Appraisal Review General Appraiser Market Analysis Highest and Best Use Expert Witness for Commercial Appraiser The FHA Handbook 4000.1 Fannie Mae Appraisal Guidelines: Debunking the Myths Residential Construction and the Appraiser Market Disturbances-Appraisals in Atypical Markets and Cycles metter@irr.com - 817.205.1414 About IRR Integra Realty Resources, Inc. (IRR) provides world-class commercial real estate valuation, counseling, and advisory services. Routinely ranked among leading property valuation and consulting firms, we are now the largest independent firm in our industry in the United States, with local offices coast to coast and in the Caribbean. IRR offices are led by MAI-designated Senior Managing Directors, industry leaders who have over 25 years, on average, of commercial real estate experience in their local markets. This experience, coupled with our understanding of how national trends affect the local markets, empowers our clients with the unique knowledge, access, and historical perspective they need to make the most informed decisions. Many of the nation's top financial institutions, developers, corporations, law firms, and government agencies rely on our professional real estate opinions to best understand the value, use, and feasibility of real estate in their market. Local Expertise...Nationally! irr.com Addenda Parcel 1 Addendum B IRR Quality Assurance Survey Addenda Parcel 1 IRR Quality Assurance Survey We welcome your feedback! At IRR, providing a quality work product and delivering on time is what we strive to accomplish. Our local offices are determined to meet your expectations. Please reach out to your local office contact so they can resolve any issues. Integra Quality Control Team Integra does have a Quality Control Team that responds to escalated concerns related to a specific assignment as well as general concerns that are unrelated to any specific assignment. We also enjoy hearing from you when we exceed expectations! You can communicate with this team by clicking on the link below. If you would like a follow up call, please provide your contact information and a member of this Quality Control Team will call contact you. Link to the IRR Quality Assurance Survey: quality.irr.com Addenda Parcel 1 Addendum C Definitions Parcel 1 Definitions The source of the following definitions is the Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago: Appraisal Institute, 2015), unless otherwise noted. As Is Market Value The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date. Disposition Value The most probable price that a specified interest in property should bring under the following conditions: 1. Consummation of a sale within a specified time, which is shorter than the typical exposure time for such a property in that market. 2. The property is subjected to market conditions prevailing as of the date of valuation. 3. Both the buyer and seller are acting prudently and knowledgeably. 4. The seller is under compulsion to sell. 5. The buyer is typically motivated. 6. Both parties are acting in what they consider to be their best interests. 7. An adequate marketing effort will be made during the exposure time. 8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto. 9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. This definition can also be modified to provide for valuation with specified financing terms. Effective Date 1. The date on which the appraisal or review opinion applies. 2. In a lease document, the date upon which the lease goes into effect. Entitlement In the context of ownership, use, or development of real estate, governmental approval for annexation, zoning, utility extensions, number of lots, total floor area, construction permits, and occupancy or use permits. Entrepreneurial Incentive The amount an entrepreneur expects to receive for his or her contribution to a project. Entrepreneurial incentive may be distinguished from entrepreneurial profit (often called developer’s Parcel 1 profit) in that it is the expectation of future profit as opposed to the profit actually earned on a development or improvement. The amount of entrepreneurial incentive required for a project represents the economic reward sufficient to motivate an entrepreneur to accept the risk of the project and to invest the time and money necessary in seeing the project through to completion. Entrepreneurial Profit 1. A market-derived figure that represents the amount an entrepreneur receives for his or her contribution to a project and risk; the difference between the total cost of a property (cost of development) and its market value (property value after completion), which represents the entrepreneur’s compensation for the risk and expertise associated with development. An entrepreneur is motivated by the prospect of future value enhancement (i.e., the entrepreneurial incentive). An entrepreneur who successfully creates value through new development, expansion, renovation, or an innovative change of use is rewarded by entrepreneurial profit. Entrepreneurs may also fail and suffer losses. 2. In economics, the actual return on successful management practices, often identified with coordination, the fourth factor of production following land, labor, and capital; also called entrepreneurial return or entrepreneurial reward. Exposure Time 1. The time a property remains on the market. 2. The estimated length of time that the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal; a retrospective opinion based on an analysis of past events assuming a competitive and open market. Fee Simple Estate Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat. Floor Area Ratio (FAR) The relationship between the above-ground floor area of a building, as described by the zoning or building code, and the area of the plot on which it stands; in planning and zoning, often expressed as a decimal, e.g., a ratio of 2.0 indicates that the permissible floor area of a building is twice the total land area. Highest and Best Use 1. The reasonably probable use of property that results in the highest value. The four criteria that the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity. 2. The use of an asset that maximizes its potential and that is possible, legally permissible, and financially feasible. The highest and best use may be for continuation of an asset’s existing use or for some alternative use. This is determined by the use that a market participant would have in mind for the asset when formulating the price that it would be willing to bid. (ISV) Parcel 1 3. [The] highest and most profitable use for which the property is adaptable and needed or likely to be needed in the reasonably near future. (Uniform Appraisal Standards for Federal Land Acquisitions) Investment Value 1. The value of a property to a particular investor or class of investors based on the investor’s specific requirements. Investment value may be different from market value because it depends on a set of investment criteria that are not necessarily typical of the market. 2. The value of an asset to the owner or a prospective owner for individual investment or operational objectives. Lease A contract in which rights to use and occupy land, space, or structures are transferred by the owner to another for a specified period of time in return for a specified rent. Leased Fee Interest The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires. Leasehold Interest The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease. Liquidation Value The most probable price that a specified interest in real property should bring under the following conditions: 1. Consummation of a sale within a short time period. 2. The property is subjected to market conditions prevailing as of the date of valuation. 3. Both the buyer and seller are acting prudently and knowledgeably. 4. The seller is under extreme compulsion to sell. 5. The buyer is typically motivated. 6. Both parties are acting in what they consider to be their best interests. 7. A normal marketing effort is not possible due to the brief exposure time. 8. Payment will be made in cash in U.S. dollars (or the local currency) or in terms of financial arrangements comparable thereto. 9. The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. This definition can also be modified to provide for valuation with specified financing terms. Parcel 1 Marketing Time An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal. Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal. Market Value The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: • buyer and seller are typically motivated; • both parties are well informed or well advised, and acting in what they consider their own best interests; • a reasonable time is allowed for exposure in the open market; • payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and • the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. (Source: Code of Federal Regulations, Title 12, Chapter I, Part 34.42[h]; also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472) Prospective Opinion of Value A value opinion effective as of a specified future date. The term does not define a type of value. Instead, it identifies a value opinion as being effective at some specific future date. An opinion of value as of a prospective date is frequently sought in connection with projects that are proposed, under construction, or under conversion to a new use, or those that have not yet achieved sellout or a stabilized level of long-term occupancy. Addenda Parcel 1 Addendum D Property Information Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addenda Parcel 1 Addendum E Comparable Data Land Sale Profile Sale No. 1 Location & Property Identification 825 E Ryan Road Property Name: Sub-Property Type: Residential, Single Family Development Land 825 E. Ryan Rd. Address: Denton, TX 76210 City/State/Zip: Denton County: Submarket: Denton Suburban Market Orientation: IRR Event ID: 3358540 Sale Information $175,000 Sale Price: $175,000 Effective Sale Price: 10/31/2022 Sale Date: Recording Date: 10/31/2022 Contract Date: 10/31/2022 Listing Price: $198,000 Listing Date: 05/29/2022 Sale Status: Closed $/Acre(Gross): $214,461 $/Land SF(Gross): $4.92 Grantor/Seller: Andrey Gorokhovskiy Grantee/Buyer: Lauren Elizabeth Kelley & Manuel Alejandro Velez Rodriguez Property Rights: Fee Simple Financing: Cash to seller Conditions of Sale: Arm's-length Document Type: Warranty Deed Recording No.: 2022-153303 Verified By: Reid Pannell Verification Date: 05/07/2025 Confirmation Source: Collin Roberts / 903-268-4294 Verification Type: Confirmed-Seller Broker Improvement and Site Data Lot 2, Block A, Leisure Lane Addition, City of Denton, Denton County, Texas / 995304 Legal/Tax/Parcel ID: 0.82 Acres(Gross): 35,545 Land-SF(Gross): Shape: Rectangular Topography: Level Vegetation: Trees and grasses Corner Lot: Yes Frontage Feet: 215 Frontage Desc.: Ryan Road Frontage Type: 2 way, 1 lane each way Traffic Control at Entry: None Traffic Flow: Moderate Zoning Code: R2 Zoning Desc.: Residential Flood Plain: No Flood Zone Designation: X Comm. Panel No.: 48121C0370G Date: 04/18/2011 Utilities: Electricity, Water Public, Sewer Source of Land Info.: Public Records Comments This property consists of 0.816 acres of vacant land, located on the north side of Ryan Road in Denton, TX. The property 825 E Ryan Road Land Sale Profile Sale No. 1 Comments (Cont'd) was sold on 10/31/2022 for $175,000 or $4.92/SF. Property is located at the northeast corner of East Ryan Road and Leisure Lane within the city limits of Denton, Texas. It is zoned, R2, Residential, which requires a minimum lot size of 16,000 SF. 825 E Ryan Road Land Sale Profile Sale No. 2 Location & Property Identification 1.04-Acre Residential Lot, Denton, TX Property Name: Sub-Property Type: Residential, Single Family Residence Site 4505 State School Road Address: Denton, TX 76210 City/State/Zip: Denton County: Submarket: Denton Suburban Market Orientation: East side of State School Road, south of Winston Drive Property Location: IRR Event ID: 2990133 Sale Information $170,000 Sale Price: $170,000 Effective Sale Price: 02/28/2023 Sale Date: Sale Status: Closed $/Acre(Gross): $163,462 $/Land SF(Gross): $3.75 $/Acre(Usable): $163,462 $/Land SF(Usable): $3.75 Grantor/Seller: Oakmont Partners JV, LP Grantee/Buyer: JAS Technologies LLC Assets Sold: Real estate only Property Rights: Fee Simple Financing: Cash to seller Conditions of Sale: Arm's-length Document Type: Deed Recording No.: 2023-19853 Verified By: Shelley Sivakumar Verification Date: 03/29/2023 Confirmation Source: Chase Traughber (972-515-0045) Verification Type: Confirmed-Seller Broker Improvement and Site Data State School Addition, Block A, Lot 2 Legal/Tax/Parcel ID: 1.04/1.04 Acres(Usable/Gross): 45,302/45,302 Land-SF(Usable/Gross): Usable/Gross Ratio: 1.00 Shape: Rectangular Topography: Level Corner Lot: No Frontage Feet: 104 Frontage Desc.: State School Road Zoning Code: R1 Zoning Desc.: Residential Flood Plain: No Utilities: Water Public, Sewer Utilities Desc.: City Water/City Sewer Source of Land Info.: Public Records Comments This residential lot is located in the Denton ISD in the city limits of Denton, Texas. The minimal lot size for the subject's zoning is 32,000 sq. ft. with approximately 30% building coverage. 1.04-Acre Residential Lot, Denton, TX Land Sale Profile Sale No. 3 Location & Property Identification 5.55 Acres on State School Road Property Name: Sub-Property Type: Residential, Single Family Residence Site State School Rd. Address: Denton, TX 76210 City/State/Zip: Denton County: Submarket: Denton Suburban Market Orientation: IRR Event ID: 3358753 Sale Information $1,185,000 Sale Price: $1,185,000 Effective Sale Price: 08/13/2024 Sale Date: Sale Status: Closed $/Acre(Gross): $213,433 $/Land SF(Gross): $4.90 Grantor/Seller: Cecil Hale Grantee/Buyer: Jamy Properties LLC Assets Sold: Real estate only Property Rights: Fee Simple Financing: Cash to seller Conditions of Sale: Arm's-length Document Type: Deed Recording No.: 2024-87094 Verified By: Mr. Mitchell L. Etter Verification Date: 05/07/2025 Confirmation Source: Jeff Higgs Verification Type: Confirmed-Seller Broker Improvement and Site Data A0950A MEP & PRR, TR 32(PT), 5.5521 ACRES, OLD DCAD TR 9A / Tax ID: 39189 Legal/Tax/Parcel ID: 5.55 Acres(Gross): 241,849 Land-SF(Gross): Zoning Code: PD-MN Zoning Desc.: Planned Development/Mixed-Use Neighborhood Flood Plain: No Source of Land Info.: Public Records Comments Property reportedly sold for $1,185,000 or $4.90 PSF. Property is 5.552 acres located at the corner of FM 2499 and State School Road within the city limits of Denton, Texas. It is zoned PD-MN, Planned Development Mixed Use Neighborhood which permits a variety of residential and commercial uses. 5.55 Acres on State School Road Land Sale Profile Sale No. 4 Location & Property Identification Land - 6.4712 Acres Property Name: Sub-Property Type: Residential, Single Family Development Land Southwest side of Helm Lane, north of Spinnaker Drive Address: Denton, TX 76210 City/State/Zip: Denton County: Submarket: Denton Suburban Market Orientation: IRR Event ID: 3224493 Sale Information $1,100,000 Sale Price: $1,100,000 Effective Sale Price: 04/24/2023 Sale Date: Sale Status: Closed $/Acre(Gross): $169,984 $/Land SF(Gross): $3.90 $/Acre(Usable): $169,984 $/Land SF(Usable): $3.90 $57,895 /Unit $/Unit (Potential): Grantor/Seller: Nancy Marie Reed Grantee/Buyer: At The Helm Texas LLC Property Rights: Fee Simple Financing: Cash to seller Conditions of Sale: Arm's-length Document Type: Deed Recording No.: 2023-40822 Verified By: Shelley Sivakumar Verification Date: 04/19/2024 Confirmation Source: Desiree Reed (940-484-9411) Verification Type: Confirmed-Seller Broker Improvement and Site Data C. Paullalier Survey, Abstract No. 1006/Tax ID 133088 Legal/Tax/Parcel ID: 6.47/6.47 Acres(Usable/Gross): 281,885/281,885 Land-SF(Usable/Gross): Usable/Gross Ratio: 1.00 No. of Units (Potential): 19 Shape: Rectangular Topography: Level Corner Lot: No Frontage Feet: 165 Frontage Desc.: South side of Helm Lane; 771' West side of Helm Lane Frontage Type: 2 way, 1 lane each way Zoning Code: R3 Zoning Desc.: Residential 3 Flood Plain: No Utilities: Water Public, Sewer Source of Land Info.: Public Records Comments This rectangular-shaped property was acquired for future residential development. Zoning requires a minimum lot size of 10,000 square feet with an estimated density of 3.0 units per acre (19 lots). This property is within the Denton ISD. Land - 6.4712 Acres