HomeMy WebLinkAbout330 S Woodrow FULL appraisalAn Appraisal Report
of
An 8,000 Square Foot
Office Warehouse Facility Located at
300 South Woodrow Lane, Denton,
Denton County, Texas 76205
TPA File #: 24.0804
As of
August 23, 2024
Prepared for
Mr. Mark Mastroleo
City of Denton
401 N Elm Street
Denton, Texas 76201
Prepared by
2301 Ohio Drive, Suite 150
Plano, Texas 75093
(214) 297-9000
www.ToddPropertyAdvisors.com
2301 Ohio Drive, Suite 150 ▲ Plano, Texas 75093 ▲ www.ToddPropertyAdvisors.com
TELEPHONE: (214) 297-9000 ▲ E-MAIL: mitchell@toddpa.com
August 30, 2024
Mr. Mark Mastroleo
City of Denton
401 N Elm Street
Denton, Texas 76201
RE: Valuation of an 8,000 square foot office warehouse facility located at 300 South
Woodrow Lane, Denton, Denton County, Texas, 76205.
Dear Mr. Mastroleo:
We have personally inspected the above-referenced property and have prepared an opinion of
value in accordance with your request. The objective of this appraisal is to provide an opinion of
market value of the fee simple estate of the subject property in “as is” condition, as of the effective
date of appraisal. All data considered pertinent to the preparation of this appraisal has been
investigated and analyzed and the results of the analysis together with our conclusions may be
found in the following report. Mitchell B. Todd, MAI, and Michael A. Keane, MAI have performed
numerous appraisals on similar properties and are sufficiently competent to complete this
assignment.
This appraisal involves an appraisal report in compliance with the Scope of Work Rule of the 2024
Edition of the Uniform Standards of Professional Appraisal Practice (USPAP) as provided by the
Appraisal Foundation. It involves the application of the Cost and Sales Comparison Approaches
to value, as well as a Certification. The exclusion of the Income Capitalization Approach to Value
is considered reasonable and its exclusion should not mislead the user of this appraisal. The
exclusion of the Income Capitalization Approach is considered reasonable due to the subject
property being a special use property and being owned by a government entity. The appraiser’s
scope of work decision involved the exclusion of the Income Capitalization Approach due to the
fact that this approach would provide a less reliable indication of value than the other two
approaches. Additionally, please note the Assumptions and Limiting Conditions located at the end
of this report. For purposes of this report, we have only been asked to provide an opinion of market
value. Additionally, please note the Certification and Assumptions and Limiting Conditions located
at the end of this report. For purposes of this report, we have only been asked for our opinion of
Market Value. The definition of market value utilized in this report complies with Title 12, Code of
Federal Regulations, Subpart C – Subsection 34.42(g), Department of the Treasury, Office of the
Comptroller of the Currency; USPAP; and FIRREA.
Mr. Mark Mastroleo
August 30, 2024
Page Two
All methodology utilized to arrive upon the opinion of market value can be found in The Appraisal
of Real Estate, Fifteenth Edition, as published by The Appraisal Institute. This appraisal report
sets forth the identification of the subject property, information regarding the subject property and
its surrounding area, comparable sales data, the results of the investigations and analyses, and
the reasoning leading to our conclusions. The appraisal assignment was not based on a
requested minimum valuation, a specific valuation or the approval of a loan.
To the best of our knowledge, the subject property has no natural, cultural, recreational, or
scientific value. As is discussed in the Estimate of Exposure Time section of this report, it is our
opinion that the sale of the subject property could be consummated within a twelve month period
at the opinion of value arrived herein.
In our opinion, and after careful consideration of the various factors entering into this appraisal,
the “as is” market value of the fee simple estate of the subject property, as of the effective date of
appraisal, August 23, 2024, was:
“As Is” Market Value:
SIX HUNDRED THOUSAND DOLLARS
($600,000)
Further, these opinions of value are contingent upon the subject property being free of any
hazardous wastes deposited thereupon by the present or previous owners/tenants of the site
which would adversely affect the value of the property. The existence of any such materials was
not observed upon the physical inspection of the property. However, we are not qualified to detect
these substances and it is recommended that an expert in this field be obtained if the client has
suspicion of these materials and substances existing on the property.
It is also assumed there is full compliance with all requirements of Title III, of the Americans with
Disabilities Act (ADA) which became effective January 26, 1992. No responsibility is assumed by
the appraisers for any such conditions, or for any expertise of architectural/design knowledge and
cost required identifying such non-compliance.
There was no information required or deemed pertinent to the completion of this appraisal, which
was not available to the undersigned unless otherwise stated in this report. Additionally, the value
conclusions found within this report are exclusive of any personal property, fixtures, or intangible
items that are not real property. Thus, the reported values within this report pertain to the real
property only. In order for the opinion of value set forth herein to be considered valid this letter of
transmittal must not be considered separately or independently of the attached appraisal report,
and this appraisal report must be used in its entirety and must not be separated into parts.
Appraisal Institute General Demonstration of Knowledge - Capstone Program
Admissions Department March 14, 2018 Page Two Based on the data rendered via a physical inspection of the subject, as well as other pertinent information, it is my opinion that the market value of the fee simple interest in the subject property, as of March 6, 2018, is:
“As Is" Market Value:
ONE MILLION SEVEN HUNDRED FORTY THOUSAND DOLLARS
($1,740,000)
Such opinion is subject to the general assumptions and limiting conditions found on page
?????. This letter must remain attached to the report, which contains ????? pages, in order for
the value opinion set forth to be considered valid. Particulars and supporting data are provided
in the accompanying report.
Respectfully submitted,
Michael A. Keane
State Certification #TX-1380384-G
michaelakeane@me.com
Mr. Mark Mastroleo
August 30, 2024
Page Three
Should any questions regarding this appraisal arise, please contact us.
Respectfully submitted,
Mitchell B. Todd, MAI Michael A. Keane, MAI
President Senior Vice President
State Certification #TX-1323514-G State Certification #TX-1380384-G
mitchell@toddpa.com michael@toddpa.com
Jonathan D. Martin
Appraisal Associate
State Certification #TX-1381200-G
jonathan@toddpa.com
TABLE OF CONTENTS
Section I - Introduction
Executive Summary ........................................................................................................ 2
Identification of the Property ............................................................................................ 4
Objective of the Appraisal................................................................................................ 5
Identification of the Appraisal Problem ............................................................................ 5
Date of Value Opinion ..................................................................................................... 5
Date of Report ................................................................................................................. 5
Appraisal Report Option .................................................................................................. 5
Intended Use/Intended User ............................................................................................ 5
Statement of Prior Services Rendered ............................................................................ 6
Property Rights Appraised............................................................................................... 6
Definition of Market Value ............................................................................................... 6
Statement of Ownership .................................................................................................. 7
Scope of Work ................................................................................................................. 7
History of the Subject Property ........................................................................................ 8
Estimate of Exposure Time ............................................................................................. 8
Estimate of Marketing Time ............................................................................................. 9
Section II – External Influences
Regional Analysis .......................................................................................................... 12
City/Neighborhood Analysis .......................................................................................... 22
Denton Industrial Market Overview ................................................................................ 27
Section III - Factual Descriptions and Analyses
Site Description and Analysis ........................................................................................ 31
Zoning and Land Use Restrictions ................................................................................. 36
Tax Analysis .................................................................................................................. 38
Description of the Improvements ................................................................................... 39
Subject Property Photographs ....................................................................................... 42
Highest and Best Use Analysis ..................................................................................... 57
The Appraisal Process .................................................................................................. 61
Section IV – Cost Approach
Description of the Cost Approach .................................................................................. 63
Land Valuation .............................................................................................................. 64
Comparable Land Sales Presentation ........................................................................... 65
Land Sales Analysis ...................................................................................................... 69
Conclusion of Land Value ............................................................................................. 75
Segregated Cost Analysis ............................................................................................. 77
Conclusion of the Cost Approach .................................................................................. 82
Section V - Sales Comparison Approach
Description of the Sales Comparison Approach ............................................................ 84
Comparable Improved Sales Presentation .................................................................... 85
Improved Sales Analysis ............................................................................................... 91
Conclusion of the Sales Comparison Approach ............................................................. 96
Section VI - Valuation Conclusion
Reconciliation and Final Opinion of Value ..................................................................... 99
Section VII - Certification & Assumptions & Limiting Conditions
Certification ................................................................................................................. 101
Assumptions and Limiting Conditions .......................................................................... 103
Section VIII – Addendum
Qualifications/Certifications of Appraisers
SECTION I - INTRODUCTION
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EXECUTIVE SUMMARY
SALIENT FACTS & CONCLUSIONS
Property Appraised: Denton Office Warehouse Facility
Property Type: Office Warehouse Facility
Location: 300 South Woodrow Lane, Denton, Denton County,
Texas 76205
Date of Inspection: August 23, 2024
Date of Valuation: August 23, 2024
Date of Report: August 30, 2024
Property Rights Appraised: Fee Simple Estate
Ownership: The City of Denton
Land Size: 11.375 acres (495,495 square feet)
Description of Improvements: The subject property consists of an 11.375 acre tract of
land improved with an approximate 8,000 square foot
office warehouse facility that was originally constructed
in approximately 1980 and has been renovated multiple
times over the life of the improvements. The office
improvements are constructed of a concrete foundation,
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brick veneer exterior walls, and a pitched metal roof. The
warehouse improvements are constructed of concrete
foundations, cinderblock and metal exterior walls, and
metal roofs. The subject is 100 percent heated/air
conditioned. Furthermore, the warehouse
improvements have a clear height of approximately 15
feet. The parking and driveway areas are concrete
paved.
Status of Property: As of the date of the appraisal, the subject tract was
improved with an approximate 8,000 square foot office
warehouse facility. The property was 100 percent vacant
as of the effective date of appraisal. The property has all
public utilities available from the City of Denton.
Zoning: PF, Public Facilities
HIGHEST AND BEST USE:
As If Vacant: Public recreational use
As Improved: Continued use as an office warehouse facility
SCOPE OF WORK
Appraisal Problem Identification: Identifying the appraisal problem within the report
includes providing a credible opinion of the market value
of the fee simple estate of the subject property in “as is”
condition as of the effective date of appraisal (August
23, 2024).
Objective of the Appraisal: The objective of the appraisal is to provide the client with
a current opinion of the market value of the fee simple
estate of the subject property in “as is” condition as of
the effective date of appraisal (August 23, 2024). It is our
understanding that this appraisal will be utilized by the
client in determining current market value.
Intended User: City of Denton and its affiliates and/or assigns
Client: City of Denton
Valuation Approaches Used: Cost and Sales Comparison Approaches
CONCLUSION OF VALUES
Cost Approach: $620,000
Sales Comparison Approach: $600,000
“As Is” Market Value: $600,000
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IDENTIFICATION OF THE PROPERTY
The subject property consists of an 11.375 acre tract of land improved with an approximate 8,000
square foot office warehouse facility that was constructed in approximately 1980 and has been
renovated multiple times over the life of the improvements. According to the property owner, the
subject office and warehouse space was originally utilized as a municipal building for the Animal
Services department before being utilized for approximately six months as part of a municipal
program for people experiencing homelessness. The subject has been vacant for approximately
three years. The office improvements are constructed of a concrete foundation, brick veneer
exterior walls, and a pitched metal roof. The warehouse improvements are constructed of
concrete foundations, cinderblock and metal exterior walls, and metal roofs. The subject consists
of approximately 20 percent office space and 80 percent warehouse space and is 100 percent
heated/air conditioned. Furthermore, the warehouse improvements have a clear height of
approximately 15 feet. The parking and driveway areas are concrete paved. The subject property
is physically located along the west line of South Woodrow Lane, south of Troy H. Lagrone Drive
and has a municipal address of 300 South Woodrow Lane, Denton, Denton County, Texas. The
following is a summarized legal description for the subject site.
Part of Lots 2 and 3 per the Plat of Adkisson Addition, as recorded in Volume 7,
Page 22 and Cabinet J, Page 102 of the Plat Records of the City of Denton.
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*Aerial photograph provided by the Denton Central Appraisal District. The purple outline depicts the approximate boundaries of the
subject property.
OBJECTIVE OF THE APPRAISAL
The objective of the appraisal is to provide the client with a current opinion of the market value of
the fee simple estate of the subject property in “as is” condition as of the effective date of appraisal
(August 23, 2024). It is our understanding that this opinion of value will be utilized by the client in
determining current market value.
IDENTIFICATION OF THE APPRAISAL PROBLEM
Identifying the appraisal problem within the report includes providing a credible opinion of the
market value of the fee simple estate of the subject property in “as is” condition as of the effective
date of appraisal (August 23, 2024).
DATE OF VALUE OPINION
An inspection of the property was conducted on August 23, 2024, and other dates. The effective
date of appraisal is August 23, 2024 “as is”.
DATE OF REPORT
The transmittal date of this appraisal is August 30, 2024.
APPRAISAL REPORT OPTION
This is an Appraisal Report that complies with the reporting requirements set forth under
Standards Rule 2-2 (a) of the Uniform Standards of Professional Appraisal Practice (USPAP). As
such, it presents sufficient information to enable the client and other intended users as identified
to understand it properly. The depth of discussion contained in this report is specific to the needs
of the client and the intended use of the appraisal as noted herein.
INTENDED USE/INTENDED USER
This appraisal report has been prepared for and is intended to be used by City of Denton and its
affiliates and/or assigns. It is our understanding that this appraisal report will be utilized by the
client in determining current market value. Therefore, the intended user of this report is City of
Denton and its affiliates and/or assigns. Use of this report by others is not intended by the
appraisers. No one other than the intended users should rely on the opinion of value or any other
conclusions contained in this report.
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STATEMENT OF PRIOR SERVICES RENDERED
Mitchell B. Todd, MAI, Michael A. Keane, MAI, and Jonathan D. Martin have rendered no services
as an appraiser or in any other capacity regarding this property within the three-year period
immediately preceding acceptance of this assignment.
PROPERTY RIGHTS APPRAISED
The fee simple estate is defined as "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 This differs from the leased fee estate. “In appraisal practice,
the lessor’s, or landlord’s, position is referred to as the leased fee. The rights of the lessor (the
leased fee owner) and the lessee (leaseholder) are specified by contract terms contained in the
lease". 2 Easement ownership is defined as “the right to use another’s land for a stated purpose”.
3
The fee simple estate has been appraised due to the subject not being currently encumbered by
any arm’s-length long-term lease agreements. This ownership interest is subject to any zoning
ordinances, easements, restrictions of record and other applicable codes and ordinances of
record.
DEFINITION OF MARKET VALUE
The definition of value which will be referred to in this report is "market value". The following
definition of market value is used by agencies that regulate federally insured financial institutions
in the United States. The definition of market value utilized in this report complies with Title 12,
Code of Federal Regulations, Subpart C – Subsection 34.42(g), Department of the Treasury,
Office of the Comptroller of the Currency; USPAP; and FIRREA. According to Section 34 of Title
12, Code of Federal Regulations, “market value” means:
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
knowledgeable, 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:
1) Buyer and seller are typically motivated,
2) Both parties are well informed or well advised and acting in what they consider their
own best interest,
1 The Appraisal Institute, The Dictionary of Real Estate Appraisal (Seventh Edition), Chicago, Illinois, 2022, page 73.
2 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, page 62.
3 The Appraisal Institute, The Dictionary of Real Estate Appraisal (Seventh Edition), Chicago, Illinois, 2022, page 58.
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3) A reasonable time is allowed for exposure in the open market,
4) Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements
comparable thereto, and,
5) 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. 4
STATEMENT OF OWNERSHIP
According to the Denton Central Appraisal District and information provided by the client, title to
the subject property is vested in the City of Denton.
SCOPE OF WORK
The scope of work is defined as the type and extent of research and analyses in an assignment.
The scope of this appraisal assignment is to provide an opinion of market value of the property.
The client’s instructions were to appraise the subject property in “as is” condition, as of the
effective date of appraisal. In compliance with the 2024 Edition of the Uniform Standards of
Professional Appraisal Practice (USPAP), and upon the request of the client, an appraisal report
has been prepared utilizing the Scope of Work Rule.
The Scope of Work Rule within USPAP emphasizes the requirements for problem identification,
determining the appropriate scope of work, and disclosure of the scope of work that was
performed in appraisal, appraisal review, and appraisal consulting assignments. The following is
a discussion of the scope of work undertaken within the context of this report.
The scope of work for this appraisal was determined by the complexity of the assignment and the
reporting requirements of this appraisal report type, including: the definition of market value, real
property interests valued, assumptions and limiting conditions, and certifications.
The appraisers considered this scope of work to be adequate to complete a credible appraisal of
the subject property. The appraisers believe that this scope of work would meet the expectations
and needs of parties who are regular intended users for similar assignments and that this scope
of work is substantially similar to what an appraiser’s peers actions would be in performing the
same or similar assignment.
The subject appraisal research began with a review of the history of the subject property by
conducting research of the Denton County public records for three years prior to the date of
appraisal. This research was facilitated by several on-line resources including CoStar.com, the
Denton Central Appraisal District, and Loopnet.com, as well as several other resources including
owners, buyers, lenders and other parties knowledgeable of the subject property. The Regional,
4 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, page 49.
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City, and Neighborhood Analyses are presented in a summarized format and include information
gathered through inspection of the areas and a review of published secondary data.
The site analysis included an inspection by the appraiser, aerial photographs via satellite, and the
FEMA flood insurance rate maps. The property inspection included a visual survey of the subject.
The inspection was conducted on August 23, 2024, and other dates. The zoning of the subject
property was verified with the zoning records of the City of Denton. The tax rates, assessed
values, and information regarding the subject's tax debt were verified by the Denton Central
Appraisal District and the individual taxing jurisdictions via the appraisal district’s website.
The analyses of the individual real estate markets which affect the subject property was performed
utilizing secondary data concerning the subject’s market found in various market surveys. Primary
data regarding the subject submarket and the immediate surrounding area was verified by the
appraisers through an inspection of the area, and interviews conducted with owners, real estate
brokers, and management company representatives.
To complete this appraisal assignment, the Cost, Income Capitalization, and Sales Comparison
Approaches were considered, however only the Cost and Sales Comparison Approaches were
utilized. The exclusion of the Income Capitalization Approach is considered reasonable due to
the subject property being a special use property and being owned by a government entity. The
appraiser’s scope of work decision involved the exclusion of the Income Capitalization Approach
due to the fact that this approach would provide a less reliable indication of value than the other
two approaches. The appraiser’s scope of work decision involved the exclusion of the Income
Capitalization Approach due to the fact that this approach would provide a less reliable indication
of value than the other two approaches. All data gathered within these approaches regarding
properties similar to the subject have been verified by the appraisers with the Grantor, the
Grantee, or their representatives. A more detailed explanation of the methods and techniques
employed in each of these approaches is located in the Valuation Process section of this report.
HISTORY OF THE SUBJECT PROPERTY
According to the Denton Central Appraisal District, title to the subject property is currently vested
in the City of Denton. No arm's-length transactions involving the subject property were uncovered
during the last three years. Furthermore, to the best of our knowledge, the subject was not listed
for sale or under contract to be sold at the time of this appraisal.
ESTIMATE OF EXPOSURE TIME
A reasonable exposure period is the amount of time necessary to expose a property to the open
market in order to achieve a sale. According to USPAP 2024, exposure time is defined as, “an
opinion, based on supporting market data, of the 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.” It is our opinion that a period of six to
nine months, with a contract period of 90 days is reasonable. This results in a total exposure time
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until closing at a title company of nine to twelve months. We performed due diligence in estimating
the exposure period for the subject property by surveying the marketing period for comparable
properties which had recently sold or were placed under contract. Additionally, the brokers
contacted in verifying the comparable improved sales within this report generally indicated that
exposure times during the last twelve months have typically ranged from six to twelve months.
It was observed that properties are often marketed for several months or years with very little
interest shown in the property. However, they eventually sell after significant price reductions. A
common tendency among the majority of these sales is that once these properties experience
price reductions, which are believed to bring them into alignment with the rest of the market, their
exposure time was typically less than one year. The price reductions and recognition of market
derived values is reflected in the comparables' sales prices. This is to the extent that the sales
price as represented by the value conclusion for the subject is attractive to an investor today.
Thus, this attractive price should result in a normal exposure of less than one year. Therefore, it
is our opinion that had the subject property been marketed at or very near the "as is" value
conclusion contained herein, it would have been sufficiently attractive to entice an investor to
purchase the property within a nine to twelve month exposure period.
ESTIMATE OF MARKETING TIME
Marketing time is defined as “An opinion of the amount of time to sell a property interest at the
concluded market value or at a benchmark price during the period immediately after the effective
date of an appraisal. Marketing time differs from exposure time, which precedes the effective date
of an appraisal.” 5 Thus, marketing time is an estimate of the amount of time necessary to sell a
property after the date of appraisal, which differs from exposure time which is a retrospective
estimate of the amount of time necessary to achieve a sale prior to the effective date of appraisal.
It is our opinion that a marketing period of six to nine months, with a contract period of 90 days is
reasonable. This results in a total marketing time until closing at a title company of nine to twelve
months. We performed due diligence in estimating the marketing period for the subject property
by surveying the marketing period for comparable properties which had recently sold or were
placed under contract. A common tendency among the majority of the sales is that once these
properties experience price reductions which are believed to bring them into alignment with the
rest of the market, their marketing period is typically less than one year. For example, properties
are often marketed for several years with very little interest shown in the property. However, they
eventually sell after significant price reductions. The price reductions and recognition of market
derived values is reflected in the comparables' sales prices. This is to the extent that the sales
price as represented by the value conclusion for the subject is attractive to an investor today.
Thus, this attractive price should result in a normal marketing period of less than one year.
5 The Appraisal Institute, The Dictionary of Real Estate Appraisal (Seventh Edition), Chicago, Illinois, 2022, page 117.
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Therefore, it is our opinion that if the subject property is marketed at or very near the value
conclusion contained herein, it will be sufficiently attractive to entice an investor or user to
purchase the property within a twelve month marketing period.
SECTION II – EXTERNAL INFLUENCES
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REGIONAL ANALYSIS
Real Estate is an immobile asset, which is dependent upon the exterior environment for economic
viability. The economic climate in which a property is located is both general (the region or area
in which a property is located) and specific (the neighborhood). Four forces continually exert
influence on real estate values within any environment: social, economic, environmental and
governmental. The purpose of this section is to consider all pertinent forces that will have an effect
on the use and value of the subject property.
The Dallas-Fort Worth-Arlington Consolidated Metropolitan Statistical Area (CMSA)
encompasses approximately 9,289 square miles in north central Texas. The Dallas-Fort Worth-
Arlington CMSA is comprised of 12 counties: Collin, Dallas, Denton, Tarrant, Johnson, Kaufman,
Parker, Rockwall, Hunt, Wise, Delta and Ellis. This CMSA, which is also referred to as the D/FW
area or Metroplex, is located 203 miles northeast of Austin, 240 miles northwest of Houston and
206 miles south of Oklahoma City. On a national level, the Metroplex is located in the southern
central sector of the country. The Dallas/Fort Worth area is located approximately equidistant
from both coasts and from the four major concentrations of population in North America: New
York, Chicago, Los Angeles and Mexico City. The following is a discussion of the aforementioned
forces that exert influence on property value.
Subject Property
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Environmental
The Dallas-Fort Worth climate is humid subtropical with hot summers. It is also considered to be
continental, characterized by a wide annual temperature range. The amount of precipitation
usually varies and ranges from less than 20" to more than 50". D/FW winters are somewhat mild,
but occasionally there are sudden drops in temperature. Periods of extreme cold that occasionally
occur are short-lived, so that even in January mild weather occurs frequently. During the summer,
the high temperatures are associated with fair skies, westerly winds, and low humidity’s. Average
high and low temperatures range from 37 F in January to 98 F in August. Rainfall occurs
throughout the year, but usually occurs more frequently during the night and also during the
spring. Usually, periods of rainy weather last for only a day or two, and are followed by several
days with fair skies. Moderate hail may occur on about two or three days a year, only causing
slight and scattered damage. However, windstorms occurring during thunderstorm activity may
be destructive. Snowfall is rare. The average length of the warm seasons (freeze-free period) is
about 249 days, or about 8 months. Thus, the local climate is very conducive of real estate
development.
The area's topography is basically level in the northern sector to gently rolling in the southern
portion. The rolling terrain of the southern sector is due to a geologic formation known as the
escarpment. This escarpment consists of a chalky soil that rests on top of shales causing unstable
building foundations. The shale soil presents shrink-swell problems for the foundations of
buildings that are constructed on it, and the chalk is an unstable soil that crumbles easily, resulting
in minor landslides.
Transportation
As stated above, on a national basis, the Dallas/Fort Worth Metroplex is centrally located, which
has resulted in the development of a major transportation network that connects the Metroplex
with the rest of the country. This network consists of major thoroughfares, railroad lines and air
carriers. In regards to roadways, the Dallas/Fort Worth region is located at the convergence of
four Interstate Highways: north-south access is provided by Interstate Highways 35 and 45 (IH-
35 and IH-45); east-west access is provided by IH-20 and IH-30. Two major outer loops provide
internal accessibility to the region. LBJ Freeway (IH-635) surrounds Dallas, and IH-820
encompasses Fort Worth. Both of these arteries connect with the interstate highways as well as
local streets, thus affording the cities regional as well as internal access. In recent years, greater
access and mobility have been expanded to the Metroplex’s surrounding communities. The
President George Bush Toll Road (SH-190) is a loop encircling IH-635 that connects IH-30 in
Garland/Rockwall to IH-20 in Grand Prairie traversing the communities of Rowlett, Mesquite,
Garland, Richardson, Plano, Carrollton, Coppell, Irving, Arlington and Grand Prairie. Additionally,
the North Texas Tollway Authority (NTTA) recently opened the Chisholm Trail Parkway
connecting the Downtown Fort Worth Business District with communities to the south including
Benbrook, Crowley, Joshua and connecting with SH-67 in Cleburne.
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Two additional toll roads which serve the Metroplex are the Dallas North Tollway and the Sam
Rayburn Tollway (SRT). SH-121(located north of SH-190) has expanded to incorporate and
become the SRT. While SH-121 continues to run east-west from Fort Worth to McKinney
connecting DFW Airport to other areas of the Metropolitan area, the SRT has provided a larger
artery for traffic to flow between the communities of Grapevine, Coppell, Carrollton, Plano, Frisco,
Allen and McKinney. The Dallas North Tollway connects downtown Dallas to the rapidly growing
areas of Frisco and Prosper. The Sam Rayburn Tollway connects central Collin County to the
vicinity of the DFW International Airport.
Reference may be made to Mobility 2040 which was adopted by the Regional Transportation
Council in March of 2016. This long range strategic plan aims to define the vision for the Region’s
transportation system and identify solutions and options. The goals of the plan are to improve
mobility, quality of life, and air quality concerns for the cities of Dallas and Fort Worth as well as
the surrounding areas. In addition, properties located along or near new or improved
thoroughfares should benefit from this plan through better access and exposure. It is worthy to
note that the region is also serviced by multiple public transportation services including bus, rail
and light rail. These services include Dallas Area Rapid Transit (DART), DART Light Rail, the Fort
Worth Transportation Authority (FWTA or The T), the Trinity Railway Express (TRE), and the
Denton County Transportation Authority (DCTA).
In addition to the various modes of ground transportation, the Metroplex is serviced by a major
international airport as well as several other local and regional airports. D/FW International Airport,
located midway between Dallas and Fort Worth, has the 2nd largest land area of any other airport
in the nation with 17,207 acres and the fourth largest in the world. In 2016, D/FW was responsible
for 65,670,697 passengers reaching their destinations, making it the world’s 11th busiest airport
in number of passengers, with service provided by 9 international and 11 domestic airlines. As of
December 2018 DFW Airport provides transportation to more than 244 destinations including 62
international and 182 domestic destinations with the number of daily flights just under 3,000
including passenger and freight. Additionally, DFW is one of 3 domestic airports and 11 globally
providing service to more than 200 destinations around the world.
The City of Dallas owns and operates Dallas Love Field. The airfield is located six miles northwest
of the downtown central business district and is managed by the City's Department of Aviation.
Southwest Airlines is the predominant user of Love Field; however, Alaska Airlines and Delta
Airlines also utilize Love Field. In 1963, several airlines had all agreed to seek full repeal of the
Wright Amendment; which restricted direct flights to other states from Love Field. In 2008, the
airport handled approximately 8,060,000 passengers. On October 13, 2014, the Wright
Amendment had been repealed and new non-stop service to several cities began. This has led
to significant increases in passenger traffic. Southwest Airlines added numerous other cities in
the beginning of 2015. In 2016, the airport handled approximately 15,563,000 passengers. To
accommodate the increase in traffic construction on a new parking garage was constructed and
opened in 2018.
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Commercial air freight service is provided to the region by the Alliance International Centre which
is the first development of its type in the world. This Fort Worth based facility comprises a 3,000-
acre cargo airport/industrial park. Meacham Field (Fort Worth), Addison Airport (North Dallas) and
several other municipal airports, provide for the area’s general aviation needs.
Social
According to The Appraisal of Real Estate, Fifteenth Edition, social forces studied by appraisers
primarily relate to population characteristics. Because the demographic composition of the
population reveals the potential demand for real estate, proper analysis and interpretation of
demographic trends are required. Real property values are affected not only by population
changes and characteristics, but also by the entire spectrum of human activity. The total
population, its composition by age and gender, and the rate of household formation and
dissolution strongly influence real property values. Social forces are also manifest in attitudes
toward education, law and order, and lifestyle options. This section of the report will identify all
social forces that may have an effect on the value of the subject property.
According to the North Central Texas Council of Governments (NCTCOG) 2023 population
estimates, North Central Texas estimated that the region had added approximately 161,433 new
residents between 2022 and 2023 for a total population of 8,284,892. A chart detailing the
individual county growth rates is located below included the most recent year over year data.
The estimated January 1, 2023, population for the NCTCOG region is 8,284,892. Last year the
region added 161,433 people, over 4,000 more residents than were added in 2021. Fort Worth
(18,943) added more population than any other city, almost double compared to the next closest
city. Celina (9,787), Frisco (7,602), Arlington (5,861) and Mansfield (5,245) round out the top 5
growth cities. For the second straight year, Collin County added more than 40,000 new residents
while Denton County and Tarrant County each added over 30,000 new people. Since 2020,
453,000 new residents now call north Texas home.”
County Name
2012 Est.
Pop.
Apr. 1
2013 Est.
Pop.
Jan. 1
2014 Est.
Pop.
Jan. 1
2015 Est.
Pop.
Jan. 1
2016 Est.
Pop.
Jan. 1
2017 Est.
Pop.
Jan. 1
2018 Est.
Pop.
Jan. 1
2019 Est.
Pop.
Jan. 1
2020 Est.
Pop.
Jan. 1
2021 Est.
Pop.
Jan. 1
2022 Est.
Pop.
Jan. 1
2023 Est.
Pop.
Jan. 1
Jan. 2022
to Jan.
2023 Abs.
Change
Jan. 2022
to Jan.
2023 %
Change
Collin 795,390 827,780 851,920 873,840 901,170 932,530 969,780 1,010,330 1,039,540 1,082,760 1,135,058 1,175,974 40,916 3.60%
Dallas 2,383,790 2,415,060 2,435,800 2,455,050 2,478,970 2,502,270 2,529,150 2,554,770 2,593,570 2,619,040 2,656,297 2,675,009 18,712 0.70%
Denton 677,880 714,000 736,900 761,040 784,840 814,560 844,260 874,240 902,190 933,220 975,158 1,006,492 31,334 3.21%
Ellis 152,570 158,070 161,200 165,010 168,690 173,410 183,360 189,820 198,640 206,810 207,623 218,125 10,502 5.06%
Erath 38,340 40,700 41,010 41,460 43,540 43,850 44,200 44,700 45,670 46,180 43,322 43,287 (35)-0.08%
Hood 53,670 58,880 61,680 64,400 64,620 64,840 65,060 65,960 66,890 66,920 62,116 62,511 395 0.64%
Hunt 87,840 90,070 91,240 92,530 93,110 94,350 95,960 97,410 99,300 101,510 104,903 109,127 4,224 4.03%
Johnson 151,790 155,240 156,710 158,880 161,670 164,970 169,160 173,700 178,260 185,180 193,494 201,427 7,933 4.10%
Kaufman 104,050 106,400 108,120 109,300 113,530 116,140 119,670 124,850 128,520 132,250 153,130 158,672 5,542 3.62%
Navarro 47,940 48,470 48,590 48,900 49,030 49,170 49,740 50,250 50,870 51,670 53,612 55,639 2,027 3.78%
Palo Pinto 28,290 28,420 28,590 28,710 28,660 28,660 28,710 28,820 28,960 29,360 28,776 29,277 501 1.74%
Parker 118,040 120,640 121,830 124,630 127,980 130,150 131,210 134,620 136,600 139,180 152,928 155,607 2,679 1.75%
Rockwall 79,570 83,400 85,900 88,200 90,570 93,130 97,990 101,020 107,780 113,350 119,897 124,734 4,837 4.03%
Somervell 8,550 8,690 8,800 8,950 9,230 9,420 9,640 9,820 9,980 10,190 9,662 9,899 237 2.45%
Tarrant 1,832,660 1,875,930 1,899,900 1,922,470 1,945,320 1,966,440 1,989,810 2,024,030 2,064,340 2,091,320 2,157,741 2,188,951 31,210 1.45%
Wise 59,600 60,920 61,690 61,970 62,240 62,460 62,700 64,060 65,300 66,010 69,741 70,159 418 0.60%
16-County Region 6,619,970 6,792,670 6,899,880 7,005,340 7,123,170 7,246,350 7,390,400 7,548,400 7,716,410 7,874,950 8,123,458 8,284,890 161,432 1.99%
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Economic
Economic forces have a direct and obvious effect on property values. The condition of an area's
economy in great measure determines the growth or decline of the population, as well as its
purchasing power, which affect the demand for goods and services. If an area's economy is in a
growth stage, construction of new housing, retail centers and expansions of employment centers
occur to accommodate the needs of the population. Conversely, as the unemployment rate rises
because of an area's declining economy, some residents move from the area, and those who
remain may have decreased disposable incomes, both of which result in a diminished demand
for housing as well as goods and services. As occupancy rates for housing, retail facilities, and
employment centers decrease, demand for new construction either decreases or may even cease
altogether. Characteristics that are considered to be demand-oriented include employment levels,
the number and size of basic industries, and the availability of mortgage credit. Economic
characteristics that are considered to be supply-oriented include the stock of available vacant and
improved properties, occupancy rates, and rental rates.
Apartment markets continue to fare better than expected, with occupancy and rents improving in
most Texas metros. According to the 2nd Quarter 2024 CoStar analytics report, the Dallas/Fort
Worth area apartment asking rent has decreased approximately 1.5% (YOY). Additionally, CoStar
reports. “Multifamily demand in Dallas-Fort Worth is rebounding, reflecting greater confidence
among households to sign leases. CoStar reports renter demand of 5,100 units in the first quarter,
on par with pre-pandemic levels and signals a promising second quarter during prime leasing for
the year. Even so, the supply/demand imbalance persists with adding 10,900 units in the first
quarter, keeping vacancy elevated at 11%, up 210 basis points year-over-year and holding at a
20-year high. In turn, rent growth remains negative at 1.5%, dampened by supply-heavy
submarkets.”
The D/FW Metroplex has an excellent transportation network, a good central U.S. location, and a
relatively low cost of living compared to other parts of the U.S., which attracts major corporate
employers. D/FW is a major product distribution center and it is a major trade hub with Mexico
and other sectors across Latin America. The Emerging Trends in Real Estate markets-to-watch
survey for 2018 revealed the Dallas/Fort Worth market as the number-five market to watch. The
area is considered to continue strong growth due to projected population increases and corporate
relocations. Multiple survey respondents and interviewees mentioned the strong job growth
driving the local economy. (Emerging Trends in Real Estate, United States and Canada 2018,
PricewaterhouseCoopers LLP and Urban Land Institute). D/FW is also known for its large
technology influence, and provides business services such as advertising, data processing,
telecommunications, and other computer services. As mentioned previously, the transportation
industry will continue to play an important part of the economy, due to D/FW International Airport’s
large influence.
According to the NCTCOG Forecast 2040, total employment for the region is anticipated to grow
in excess of 2,750,000 jobs between 2010 and 2040. Dallas County alone is expected to
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encounter over 1.3 million new jobs during this time period accounting for more than 45% of the
projected growth. Collin and Denton counties will account for 18% of the region’s total growth by
adding approximately 314,000 and 196,000 new jobs respectively between 2010 and 2040.
Tarrant County is anticipated to add approximately 713,000 new jobs during this time period as
well. Employment is expected to increase tremendously over the next 20+ years which will only
continue to contribute to the growing economy of the region. The following page contains an
economic snapshot of the Dallas-Fort Worth-Arlington Metropolitan District (Dallas, Tarrant,
Collin, Denton, Rockwall, Johnson, Ellis, Hunt, Kaufman, Wise, Parker, Hood, and Somervell
Counties). This information was provided by the Texas Workforce Commission from their June
2024 Economic Profiles and is currently the most recent available.
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Dallas-Fort Worth-Arlington MSA June 2024
E l l i s
W i s e
H u n t
C o l l i n
D a l l a sP a r k e r
D e n t o n
T a r r a n t
K a u f m a n
J o h n s o n
H o o d
S o m e r v e l l
R o c k w a l l
MSA Labor Force Statistics
Jun-24 May-24 Jun-23 Yearly Change
Civilian Labor Force 4,462,840 4,425,687 4,366,866 95,974
Employed 4,271,252 4,267,136 4,196,886 74,366
Unemployed 191,588 158,551 169,980 21,608
Unemployment Rate 4.3%3.6%3.9%0.4%
Texas Labor Force Statistics
Jun-24 May-24 Jun-23 Yearly Change
Civilian Labor Force 15,436,594 15,284,078 15,067,871 368,723
Employed 14,736,520 14,709,352 14,440,713 295,807
Unemployed 700,074 574,726 627,158 72,916
Unemployment Rate 4.5%3.8%4.2%0.3%
US Labor Force Statistics
Jun-24 May-24 Jun-23 Yearly Change
Civilian Labor Force 169,007,000 167,576,000 167,910,000 1,097,000
Employed 161,774,000 161,341,000 161,559,000 215,000
Unemployed 7,233,000 6,235,000 6,351,000 882,000
Unemployment Rate 4.3%3.7%3.8%0.5%
Historical Unemployment Rates
Jun-14Aug-14Oct-14Dec-14Feb-15Apr-15Jun-15Aug-15Oct-15Dec-15Feb-16Apr-16Jun-16Aug-16Oct-16Dec-16Feb-17Apr-17Jun-17Aug-17Oct-17Dec-17Feb-18Apr-18Jun-18Aug-18Oct-18Dec-18Feb-19Apr-19Jun-19Aug-19Oct-19Dec-19Feb-20Apr-20Jun-20Aug-20Oct-20Dec-20Feb-21Apr-21Jun-21Aug-21Oct-21Dec-21Feb-22Apr-22Jun-22Aug-22Oct-22Dec-22Feb-23Apr-23Jun-23Aug-23Oct-23Dec-23Feb-24Apr-24Jun-240%
2%
4%
6%
8%
10%
12%
14%
16%
Texas US Dallas-Fort Worth-Arlington
Employment by Size Class (4th Quarter 2023)Wages by Industry (in millions) (4th Quarter 2023)
0 : 0.3%1-4 : 3.8%5-9 : 3.8%10-19 : 5.4%20-49 : 9.2%
50-99 : 8.7%
100-249 : 12.8%
250-499 : 9.8%500-999 : 9.4%
1000 and over : 36.8%
Natural Resourcesand Mining $752.00Construction $5,240.87
Manufacturing $7,010.55
Trade, Transportationand Utilities $15,252.85
Information $2,579.05FinancialActivities $9,389.43
Professional andBusiness Services $18,965.61
Education andHealth Services $8,260.14
Leisure andHospitality $3,487.64
OtherServices $1,371.87
Government $8,165.59Unclassified $53.59
Annual Growth Rate Total Non-agricultural employment
Jun-14Aug-14Oct-14Dec-14Feb-15Apr-15Jun-15Aug-15Oct-15Dec-15Feb-16Apr-16Jun-16Aug-16Oct-16Dec-16Feb-17Apr-17Jun-17Aug-17Oct-17Dec-17Feb-18Apr-18Jun-18Aug-18Oct-18Dec-18Feb-19Apr-19Jun-19Aug-19Oct-19Dec-19Feb-20Apr-20Jun-20Aug-20Oct-20Dec-20Feb-21Apr-21Jun-21Aug-21Oct-21Dec-21Feb-22Apr-22Jun-22Aug-22Oct-22Dec-22Feb-23Apr-23Jun-23Aug-23Oct-23Dec-23Feb-24Apr-24Jun-24-15%
-10%
-5%
0%
5%
10%
15%
Rate
Employment by Industry (June 2024)Employment by Industry (June 2024)
Industry
Current Month
Employment
% Monthly
Change
% Yearly
Change
Total Nonfarm 4,290,500 0.0%1.5%
Mining, Logging and Construction 260,100 3.1%4.9%
Manufacturing 314,700 0.9%1.9%
Trade, Transportation, and Utilities 899,900 0.0%0.7%
Information 90,600 0.1%-2.5%
Financial Activities 372,700 0.3%0.9%
Professional and Business Services 775,500 0.1%0.2%
Private Education and Health
Services
513,400 -0.8%2.5%
Leisure and Hospitality 439,000 0.8%0.7%
Other Services 144,800 0.9%4.5%
Government 479,800 -2.6%3.4%
Mining, Loggingand Construction 6.1%
Manufacturing 7.3%
Trade, Transportation,and Utilities 21.0%
Information 2.1%Financial
Activities 8.7%
Professional andBusiness Services 18.1%
Private Education andHealth Services 12.0%
Leisure andHospitality 10.2%
OtherServices 3.4%
Government 11.2%
7/25/2024 4:09:42 PMPage 1 of 1
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Governmental
Although the Metroplex is governed by state and county agencies, the most direct influence on
properties lies with the municipalities. The majority of the cities within the nine county area have
council-manager forms of government. County and city governments are financed by a
combination of property taxes, sales taxes, and miscellaneous taxes, fees, and fines. Property
taxes are collected by the various taxing districts based upon market value assessments
determined each year by county appraisal districts. No personal or corporate income taxes are
levied by any city or county in the CMSA. The state of Texas does impose Franchise Taxes which
are an indirect form of corporate income tax.
The City of Dallas has a council-manager form of government with the mayor selected at-large,
14 single member district council members, and one city manager. In a council-city management
form of government, council members represent the people in their geographic districts. The City
Manager is responsible to the council for the administration of business policies that the council
has established. Services provided by the city include complete fire protection, police protection,
water, sewer and garbage disposal. Electric service is provided by Oncor Electric Company while
natural gas is provided by Atmos Energy. Telephone service is provided by AT&T. Fort Worth,
like Dallas, utilizes a Council-City Management form of government. The Fort Worth City Council
consists of an appointed City Manager, an at-large elected mayor and eight council members.
The City manager is the Chief Administrator of the city and is appointed by and accountable to
the council. Also, like Dallas, water, sanitation, sewer services, and police and fire protection, as
well as street and bridge maintenance are all provided by the City government. The other utility
carriers of electricity, gas and telephone are all provided by the companies serving Dallas.
Conclusion
Total Nonfarm employment was essentially unchanged in June as the series registered a drop of
1,200 positions over the month. Since June 2023, Total Nonfarm employment increased by
267,400 jobs as annual growth slowed to a rate of 1.9 percent. Private sector employment
declined over the month by 4,300 positions and grew by 1.8 percent annually. Four of 11 major
industries added jobs over the month, and 10 major industries grew over the year. Two private
industries achieved series highs.
Construction employment surged again in June with 5,100 jobs added over the month to reach a
fifth consecutive series peak. The annual gain of 36,100 jobs was the largest in a year as the
growth rate ticked up to 4.4 percent. With the addition of 3,900 jobs in June, Private Education
and Health Services employment reached a series employment high in the 11th consecutive
month. The Private Educational Services subsector added 3,100 jobs over the month while Health
Care and Social Assistance grew by 800 positions. Both subsectors recorded new series high job
counts in June. Manufacturing employment registered a third straight month of four-figure
increases with 2,500 positions gained in June. Durable Goods manufacturing drove the monthly
growth with 2,600 jobs added over the month.
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The Texas unemployment rate was unchanged over the month at 4.0 percent in June and has
declined 8.8 points compared to April 2020, when it peaked at 12.8 percent due to measures
taken to slow the spread of COVID-19. The U.S. unemployment rate rose by a tenth of a point
over the month and increased by half a point annually to 4.1 percent.
The Texas civilian labor force grew by 49,100 people over the month. The number of employed
increased in June by 38,900, while the unemployed increased by 10,300. The U.S. civilian labor
force increased by 277,000 individuals in June. The employed population expanded by 116,000
over the month.
As illustrated in the recent statistics, the Dallas-Fort Worth-Arlington Metroplex continues to be
one of the fastest growing areas of the United States. This trend is expected to continue in the
future and through the year 2030, as population is expected to reach 9.1 million. More employers
are expected to migrate to D/FW, and therefore provide an increased number of jobs. Dallas/Fort
Worth accounts for over 30 percent of the State’s gross regional product and is a national leader
in the creation of new jobs, corporate relocations, and technology-related businesses. One of the
primary factors in maintaining this employment growth is excellent access to the area provided
by a well-developed highway system and D/FW International Airport, as well as an extensive rail
transportation system. Since the late 1990s, the D/FW economy has shown good signs of growth
and stability. Many experts are guardedly optimistic about the current economic outlook as it
compares favorably to a softening national economy and the last two years of erratic energy
Civilian Labor Force Estimated for Texas and the United States
Seasonally Adjusted (In Thousands)
Yearly Yearly
Jun-24 May-24 Jun-23 Change Jun-24 May-24 Jun-23 Change
Civilian Labor Force 15,311,531 15,262,421 15,084,714 226,817 Civilian Labor Force 168,009,000 197,732,000 167,000,000 1,009,000
Employed 14,694,468 14,655,624 14,488,950 205,518 Employed 161,199,000 161,083,000 161,004,000 195,000
Unemployed 617,063 606,797 595,764 21,299 Unemployed 6,811,000 6,649,000 5,997,000 814,000
Unemployment Rate 4.0%4.0%3.9%0.1%Unemployment Rate 4.1%4.0%3.6%0.5%
TX Labor Force Statistics US Labor Force Statistics
Seasonally Adjusted (In Thousands)
Texas Employment by Industry
Total Nonagricultural 13,871,582 100.0%13,674,848 100.0%13,558,949 100.0%1.4%2.3%
Total Private 13,380,598 96.5%13,187,411 96.4%13,091,408 96.6%1.5%2.2%
Goods Producing 2,103,279 15.2%2,095,382 15.3%2,042,969 15.1%0.4%3.0%
Natural Resources and Mining 271,210 2.0%271,390 2.0%266,419 2.0%-0.1%1.8%
Construction 867,163 6.3%862,295 6.3%832,048 6.1%0.6%4.2%
Manufacturing 964,906 7.0%961,697 7.0%944,502 7.0%0.3%2.2%
Service Providing 11,768,303 84.8%11,579,466 84.7%11,515,980 84.9%1.6%2.2%
Trade, Transportation, and Utilities 2,905,417 20.9%2,836,929 20.7%2,870,910 21.2%2.4%1.2%
Information 238,570 1.7%240,486 1.8%242,954 1.8%-0.8%-1.8%
Financial Activities 890,117 6.4%890,733 6.5%880,331 6.5%-0.1%1.1%
Professional and Business Services 2,153,770 15.5%2,137,572 15.6%2,149,288 15.9%0.8%0.2%
Education and Health Services 3,210,798 23.1%3,088,620 22.6%3,094,456 22.8%4.0%3.8%
Leisure and Hospitality 1,508,801 10.9%1,531,709 11.2%1,450,075 10.7%-1.5%4.0%
Other Services 369,846 2.7%365,980 2.7%360,425 2.7%1.1%2.6%
Public Administration 490,984 3.5%487,437 3.6%467,541 3.4%0.7%5.0%0
% of Total % of Total % of Total Quarterly
Change
Yearly
ChangeINDUSTRY TITLE Q4 2023
Employment
Q3 2023
Employment
Q4 2022
Employment
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prices. Dallas/Fort Worth is larger today in population than 27 states, and is a major economic,
social, and political center of both Texas and the United States. Due to the changing
demographics, the regional economy in general, and the continued stability of the local
government, expectations for the region’s future are optimistic.
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CITY/NEIGHBORHOOD ANALYSIS
A neighborhood is defined in The Appraisal of Real Estate, Fifteenth Edition, published by the
Appraisal Institute, as a group of complementary land uses. Land uses within a neighborhood
are not necessarily homogeneous, as in a district, but are related in that property values are
affected by the same factors. Neighborhood boundaries identify the physical area that influences
the value of a subject property. These boundaries may coincide with observable changes in
prevailing land use or occupant characteristics. Physical features such as the type of structures,
street patterns, terrain, vegetation, and lot sizes tend to identify land use districts. Transportation
arteries, bodies of water, and changing elevation can also be significant boundaries. To identify
the neighborhood boundaries, we have followed the following four steps (summarized), as
recommended within The Appraisal of Real Estate: 1) Examine the subject property; 2) Examine
the area's physical characteristics, 3) Determine preliminary boundaries on a map; and 4)
Determine how well the preliminary boundaries correspond to the demographic data.
The following neighborhood description will include a definition of the boundaries of the subject
neighborhood, a discussion of the primary thoroughfares, types of improvements along these
thoroughfares, the density of development, secondary street infrastructure, and a discussion of
the type of commercial uses within the neighborhood. The subject neighborhood, as defined
herein, is considered to be the immediate competing trade area for the subject property, taking
Subject Property
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into account the various types of land uses present or reasonably probable in the neighborhood,
patterns and rates of growth, traffic patterns and density, and the density of land use, among other
factors considered in the previously suggested steps. All of these factors are considered
influential in the determination of the value of the subject.
Neighborhood Boundaries
The subject site is physically located along the west line of South Woodrow Lane, south of Troy
H. Lagrone Drive in Denton. The neighborhood is defined as the city limits of Denton. The
neighborhood has good accessibility given its proximity to Interstate 35W and the major
transportation nodes.
Location
The subject property is located in the City of Denton, Texas, in Denton County. The site is heavily
influenced by the Dallas/Fort Worth Metroplex. The subject property is located approximately 40-
45 miles northwest of the Dallas Central Business District. Primary access to and from Denton is
provided by Interstate Highway 35 West from Fort Worth and Interstate Highway 35 East from
Dallas. Major thoroughfares surrounding Denton include Loop 288 to the north and east of
Denton, and Interstate Highway 35 to the south and west. North/south access through Denton is
provided by U.S. Highway 77 while major east/west thoroughfares include McKinney, Oak, and
Hickory Streets as well as University Drive.
Population
As can be seen in the following charts provided via the Site to do Business, the 2024 population
estimate was 155,374. The population has grown at a steady rate of 1.87 percent annually since
2010. Population between 2024 and 2029 is expected to grow at a steady rate of 2.03 percent
annually. The charts for population and household growth are located below.
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Income
According to the Site to do Business, the 2024 median household income within the neighborhood
was $74,368, which is below the national average of $79,068. Income is projected to increase at
a relatively steady rate of 2.17% over the next five years. Located below is a chart detailing the
median, average and per capita income for the subject neighborhood.
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Employment
According to the Site to do Business, employment was relatively high with a low unemployment
rate of 3.9%. The main industries within the city include Services, Retail Trade, and
Manufacturing. Approximately 66.0% of residents work in white-collar jobs.
Conclusion
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The neighborhood has been impacted positively by a recovery and growth in the national
economy since the end of the Great Recession. The progress has continued into 2024 and is
anticipated to continue into the near future. The D/FW market in general experienced economic
growth and remained attractive for investment opportunities. Given this, indications were that
market conditions within this neighborhood were moving in a positive direction.
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DENTON INDUSTRIAL MARKET OVERVIEW
Chart provided by CoStar
Vacancy Rates
The industrial vacancy rate in the Denton Industrial Market has been increasing over the past five
years. The vacancy rate currently stands at 18.53 percent, compared to approximately 14.6
percent in the 2nd quarter of 2023. The five-year average vacancy rate is 8.99 percent.
Vacancy Rate
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Absorption
The five-year average net absorption has been 2,500,000 square feet.
Net Absorption
Rental Rates
The current average rental rate for the Subject industrial Market was $10.41 per square foot, and
the five-year average rental rate was $8.63 per square foot. The average rental rate has steadily
increased over the last five years.
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Market Asking Rent Per SF
Conclusion
As detailed on the previous pages, overall, the subject industrial market has been experiencing
decreasing occupancy rates, but positive absorption, and increasing rental rates over the last five
years. Current demand is anticipated to remain relatively stable, and the market is anticipated to
experience fairly steady growth over the next 3-5 years.
SECTION III - FACTUAL DESCRIPTIONS AND ANALYSES
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SITE DESCRIPTION AND ANALYSIS
Site description consists of comprehensive factual data, information on land use restrictions, a
legal description, other title and record data, and information on pertinent physical characteristics.
Site analysis goes further. It is a careful study of factual data in relation to the market area
characteristics that create, enhance, or detract from the utility and marketability of specific land
or a given site as compared with other sites that it competes with. 6
Location and Legal Description
The subject property has a municipal address of 300 South Woodrow Lane and is physically
located along the west line of South Woodrow Lane, south of Troy H. Lagrone Drive in Denton,
Texas. The following is a summarized legal description for the subject site.
Part of Lots 2 and 3 per the Plat of Adkisson Addition, as recorded in Volume 7,
Page 22 and Cabinet J, Page 102 of the Plat Records of the City of Denton.
Access and Exposure
At the subject, South Woodrow Lane is a four-lane, bi-directional, asphalt-paved primary roadway.
Therefore, the subject is considered to have good access and exposure characteristics.
Size and Shape
The subject property comprises a total of 11.375 acres (495,495 square feet) of land and is
rectangular in shape. A parcel map for the subject is located as follows:
6 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, page 165.
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Parcel Map
Subject Property
Easements
The subject tract appears to be encumbered by typical utility easements. We were not furnished,
and it is beyond the defined scope of our assignment to obtain title work for the subject property.
For purposes of this analysis, we are assuming that only typical utility easements exist and that
they would not, and/or have not adversely affected development of the subject property. If this
assumption is not correct it could necessitate re-analysis.
Soils
Strict attention should be taken to the soils, insofar as preliminary site work preparation and
excavation is concerned, as damage may occur to improvements if proper precautions are not
undertaken. However, these soil characteristics are very common throughout the region and
should not seriously hinder the development potential of the site, provided proper site preparation
and planning is undertaken. Based upon the extent of development in the subject neighborhood,
there is no anticipated difficulty with improvements built upon these subsoil conditions, assuming
proper design and workmanship.
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Flood Zone
Approximately 95 percent of the subject property appears to lie within the 100-year flood zone or
regulatory floodway, according to Community-Panel Numbers 48121C0380G dated April 18,
2011, as prepared by the Federal Emergency Management Agency (FEMA) National Flood
Insurance Program. It should be noted that a portion of the subject improvements and parking
areas are located inside of the flood plain. A copy of the FEMA map for the subject property is
located as follows:
Subject Property
Environmental Concerns
The existence of any hazardous substances or materials was not observed upon the physical
inspection of the tract. However, we are not qualified to detect these substances. It should be
noted that the opinions of value found within this report are contingent upon the subject property
being free of any hazardous wastes deposited thereupon by the present or previous
owners/tenants of the sites, which would adversely affect the value of the property.
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Topography
The topography of the subject tract is gently sloping from north to south. Furthermore, the
topography should not limit the use of the property. Drainage of the site appears to be adequate.
Surrounding Land Uses
The neighborhood is best described as a mix of vacant land, the Denton County Juvenile
Detention Center, and park uses. The land uses immediately surrounding the subject include the
Denton County Juvenile Detention Center to the north, vacant land to the east and west, and a
public park and school uses to the south. An aerial photo depicting the surrounding land is located
following this paragraph.
Subject Property
Utilities and Public Services
The subject property appears to have access to all utilities. Telephone, electricity service, and
natural gas are available from multiple providers. The subject is also serviced by public utility
services, including police and fire protection.
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Conclusion
The subject property is located in the City of Denton in Denton County. The subject property
comprises a total of 11.375 acres (495,495 square feet) and is improved with an 8,000 square
foot office warehouse facility. The tract has access to all utilities and has good access/exposure
characteristics. Approximately 95 percent of the subject property appears to lie within the 100-
year flood zone or regulatory floodway, with portions of the subject improvements and parking
areas located inside of the flood plain. The tract has a gently sloping topography. Soil and subsoil
conditions are not anticipated to severely restrict the development potential of the site. The tract
does not appear to be encumbered by any severe easements or encroachments.
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ZONING AND LAND USE RESTRICTIONS
The subject tract is within the corporate limits of the City of Denton. The tract is currently zoned
PF, Public Facilities. According to the Denton Code of Ordinances, the PF, Public Facilities District
is intended “to provide adequate lands for public and quasi-public community uses and services,
including but not limited to fire stations, schools, libraries, community centers, hospitals, civic
buildings, open space, parks, utilities, and other public-related facilities.” It appears the subject is
currently a legally conforming use. A copy of the City of Denton zoning map as well as zoning
requirements for the subject can be found following this paragraph.
Zoning Map
Subject Property
There are no other known deed restrictions, either public or private, that would further limit the
utilization of the subject property. This statement should not be taken as a guarantee or warranty
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that no such restrictions exist. Deed and title examinations by a competent attorney on the
property appraised is recommended if any questions regarding such restrictions should arise.
Deed restrictions are matters legal in character within the State of Texas, and only title
examination by a qualified attorney can result in an informed opinion. Should there be a question
regarding the compliance with any existing deed restrictions, we recommend a title examination
by a licensed and qualified title attorney to the extent assurances to this matter are desired.
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TAX ANALYSIS
The Texas legislature has provided for a unified system of taxation for the assessment and
collection of real property taxes. In each county an appraisal district is established for the purpose
of listing and assessing all real estate within the county. Theoretically, real property is assessed
at 100 percent of market value. Once the taxable value of the property is established by the
appraisal district, each of the individual taxing authorities within the county set their own tax rates.
However, the subject property is identified by the Denton Central Appraisal Districts as being
exempt from paying property taxes. Thus, no further tax analysis is warranted.
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DESCRIPTION OF THE IMPROVEMENTS
The subject property consists of an 11.375 acre tract of land improved with an approximate 8,000
square foot vacant office warehouse facility that was constructed in approximately 1980 and has
been renovated multiple times over the life of the improvements. According to the property owner,
the subject office and warehouse space was originally utilized as a municipal building for the
Animal Services department before being utilized for approximately six months as part of a
municipal program for people experiencing homelessness. The office improvements are
constructed of a concrete foundation, brick veneer exterior walls, and a pitched metal roof. The
warehouse improvements are constructed of concrete foundations, cinderblock and metal exterior
walls, and metal roofs. The subject consists of approximately 20 percent office space and 80
percent warehouse space and is 100 percent heated/air conditioned. Furthermore, the warehouse
improvements have a clear height of approximately 15 feet. The parking and driveway areas are
concrete paved. The subject property is physically located along the west line of South Woodrow
Lane, south of Troy H. Lagrone Drive in Denton, Texas. Based upon the improvement size of
8,000 square feet and a land area of 11.375 acres (495,495 square feet), the subject has a land-
to-building ratio of 61.94 to 1.0.
The following is a description of the building components of the subject's structure. The exact
building components were not provided; however, this is our best estimate of these building
components and is described using building component descriptions from the Marshall Valuation
Service.
Description of the Building's Components
Excavation and Site Preparation: Typical clearing and site preparation with no
significant excavation
Foundation: Concrete, bearing walls
Frame: Metal frame
Floor Structure: Concrete on ground
Floor Cover: Ceramic tile and carpet and pad in office
areas; sealed concrete in warehouse areas
Ceiling: Suspended ceiling grid with acoustic mineral
fiber tiles in office areas, exposed frame in
warehouse areas
Interior Construction: Interior construction, framed (typical for office
warehouse)
Plumbing: Plumbing (typical for office warehouse)
HVAC: Package heating and cooling
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Electrical: Electrical, finished (typical for office
warehouse)
Exterior Wall: Brick veneer, metal, cinderblock
Roof Structure: Steel joists, steel deck
Roof Cover: Metal
Site Improvements: Concrete parking, fencing, landscaping
Condition of the Improvements
The subject improvements are considered to be constructed of average quality structural
components and workmanship. The facility was found to be in fair condition with minor items of
deferred maintenance or incurable, physical deterioration noted upon inspection including
damaged ceiling tiles, air vents, and fixtures. An overall effective age of 40 years is estimated for
the improvements.
Estimate of Physical Life and Effective Age
According to the Marshall and Swift Valuation Service, the typical physical life expectancy of
buildings similar to the subject is 45 years. This estimate assumes prudent management and
proper maintenance of the improvements.
Considering the quality of the subject building’s components, and also the overall utility of the
structure, an estimate of 45 years appears to be an appropriate determination of the physical life
of the subject property. An overall effective age of 40 years is estimated for the improvements.
The difference between the improvements effective age and estimated life indicates a remaining
physical and economic life of 5 years.
Conclusion
Construction of the subject property was completed in approximately 1980 and has been
renovated multiple times over the life of the improvements. The improvements are considered to
be constructed of average quality structural components and workmanship. The facility was found
to be in fair condition with minor items of deferred maintenance or incurable, physical deterioration
noted upon inspection including damaged ceiling tiles, air vents, and fixtures. An overall effective
age of 40 years is estimated for the improvements, and a remaining economic life of 5 years.
Finally, it is assumed that there is full compliance with all requirements of Title III of the Americans
With Disabilities Act (ADA). In the course of the inspection, no items of non-compliance were
observed. However, we are not qualified experts in detecting non-compliance and no
responsibility is assumed for any such conditions, or for any expertise or architectural/design
knowledge and cost required to identify such non-compliance. The opinions of value contained
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herein are predicated upon the assumption that there is no non-compliance of the law. We urge
the client to retain an expert in this field, if so desired.
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of the subject office building
Exterior view of the subject office building
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of the subject office building
Exterior view of the subject office building
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of office parking area
Exterior view of subject warehouse
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of subject warehouse
Exterior view of subject fenced area
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of subject warehouse
Exterior view of subject warehouse
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SUBJECT PROPERTY PHOTOGRAPHS
Exterior view of subject warehouse
Exterior view of subject warehouse
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject warehouse space
Interior view of subject warehouse space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject warehouse space
Interior view of subject warehouse space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject warehouse space
Interior view of subject warehouse space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject warehouse space
Interior view of subject warehouse space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject warehouse space
Interior view of subject warehouse space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of subject office space
Interior view of subject office space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of a subject office space
Interior view of a subject office space
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SUBJECT PROPERTY PHOTOGRAPHS
Interior view of office space
Interior view of subject office space
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SUBJECT PROPERTY PHOTOGRAPHS
Viewing north down South Woodrow Lane from subject
Viewing south down South Woodrow Lane from subject
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HIGHEST AND BEST USE ANALYSIS
The economic principles which affect the market value of real property also play a significant role
in forming the property's highest and best use. In all valuation assignments, value opinions are
based upon use. The highest and best use of a property provides the foundation for a thorough
investigation of the competitive positions of market participants. Consequently, highest and best
use can be described as the foundation upon which market value rests. The highest and best use
of a property is defined as follows:
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. 7
With regard to vacant land, the highest and best use is generally regarded as that use among all
reasonable, alternative uses, which yields the highest present land value, after payments are
made for labor, capital, and coordination. It is to be recognized that in cases where a site has
existing improvements on it, the highest and best use may very well be determined to be different
from the existing use.
Analysis of the highest and the best use of a property as improved implies that the existing
improvement should be renovated or retained as is so long as it continues to contribute to the
total market value of the property, or until the return from a new improvement would more than
offset the cost of demolishing the existing building and constructing a new one. Furthermore, the
existing use will continue, unless and until land value in its highest and best use exceeds the total
value of the property in its existing use.
Implied within this definition is recognition of the contribution of that specific use to community
environment or to community development goals in addition to wealth maximization of individual
property owners. In appraisal practice, the concept of highest and best use represents the
premise upon which value is based. In the context of most probable selling price (market value)
another appropriate term to reflect highest and best use would be most probable use. The most
probable use is defined as follows:
1) The use to which a property will most likely be put based on market analysis and
the highest and best use conclusion. The most probable use is the basis for the
most probable selling price of the property.
2) Highest and best use in the context of market value. 8
7 The Appraisal Institute, The Dictionary of Real Estate Appraisal (Sixth Edition), Chicago, Illinois, 2015, page 109.
8 Ibid. page 152.
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To test for the most feasible or the highest and best use for land as vacant all logical and feasible
alternatives must be analyzed. All alternative uses must meet four criteria. The criteria are as
follows:
1) The legal use of the site – what uses of the site are permitted under applicable
zoning ordinances and other legal restrictions.
2) The physical use of the site – what potential uses of the site are physically
possible.
3) The feasible use of the site – what possible and legally permissible use of the site
will produce a positive return.
4) The maximum productive use of the site – among the highest financially feasible
uses, the use that provides the highest rate of return, or value (given a constant
rate of return), is the highest and best use.
While some investors/developers seek to maximize their returns, most seem to operate on the
belief that the available information is too imperfect to permit optimization or maximization. It
appears that the typical investor is satisfied if their investment can be expected to return a yield
that will meet their standards. Thus, it is possible for more than one single use to be feasible for
a site if the uses meet an investment criteria of the typical investor/developer for a property.
Generally accepted professional appraisal practice dictates that in appraising improved property,
the highest and best use be estimated under two different premises. First, the highest and best
use of the site “as vacant and available” must be estimated. The second analysis estimates the
highest and best use of the property “as improved or proposed to be improved.”
Highest and Best Use of the Site As If Vacant
The first question to be answered, What uses are legally permissible? requires a review of the
zoning restrictions applicable to the site. As indicated in the Zoning and Land Use Restrictions
section of this report, the subject property is zoned PF, Public Facilities District. According to the
Denton Code of Ordinances, the PF, Public Facilities District is intended “to provide adequate
lands for public and quasi-public community uses and services, including but not limited to fire
stations, schools, libraries, community centers, hospitals, civic buildings, open space, parks,
utilities, and other public-related facilities.” Therefore, a public or governmental use would be
considered legally permissible.
Addressing the second question, What uses of the site are physically possible? requires a
review of the physical characteristics of the site. The subject property comprises a total of 11.375
acres (495,495 square feet). The size of a parcel of land is important in terms of feasible
development alternatives, and, ultimately, the value of the land. Optimal size is that which allows
the highest marginal returns on investment after development. A tract of land which is too large is
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worth more in subdivided parcels whereas a tract which is too small for development is worth
more when combined with contiguous sites. A less than optimally sized small tract may be further
constrained if contiguous tracts are currently developed to their highest and best use. In such a
case, assemblage may not be a viable alternative.
The subject tract is rectangular in shape and is physically located along the west line of South
Woodrow Lane, south of Troy H. Lagrone Drive in Denton Texas. The site has good
access/exposure characteristics.
The site is gently sloping which is not considered to adversely affect the developability of the
subject. The site does not appear to be affected by adverse easements, or encroachments.
However, as discussed previously, approximately 95 percent of the subject property appears to
lie within the 100-year flood zone or regulatory floodway. Given the presence and configuration
of the 100-year flood plain on the subject tract, the presence of the flood plain is considered to
adversely affect the overall developability of the subject. Based upon an analysis of surrounding
land uses within the subject neighborhood and the significant presence of flood plain, it is our
opinion that the subject tract can be utilized for a public recreational use, such as a park, ball
fields, golf course, greenbelt preservation, and other recreational and/or cultural uses.
Answering the third and fourth questions, What uses are financially feasible? and What uses
are maximally productive? requires an analysis of potential income based on demand that could
be expected from all physically possible and legally permissible uses.
Given that the majority of the tract is located in the flood plain, no private investor type entity would
be able to develop a project that would be financially feasible given the significant costs of bringing
the site out of the floodplain. This is especially the case, given that the southern portion of the
tract is in the regulatory floodway, which is not allowed to be reclaimed for any improvements.
Based upon the limitation of the potential uses for the subject, the highest and best use of the
subject parcel is a municipal project such as a park, ball fields, golf course, greenbelt preservation,
and other recreational and/or cultural uses.
Highest and Best Use as Improved
The preceding analysis is for the 11.375 acre site, as if vacant. This section treats the highest and
best use of the property as improved. The subject site is improved with an approximate 8,000
square foot office warehouse facility. The improvements are in fair condition overall and do appear
to contribute to the total value of the property. Finally, the improvements are constructed of
average quality structural components and workmanship.
The improvements do contribute to property value above and beyond the value of the underlying
land. Thus, it would be impractical to remove the improvements. Additionally, an alternative use
of the property would not result in as high a value as the current use. Therefore, the continued
operation of the existing office warehouse facility results in the highest overall value considering
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the alternatives. This is in our opinion, the highest and best use of the site, as improved.
Furthermore, it is our opinion that an owner-user would be the most likely purchaser of the subject.
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THE APPRAISAL PROCESS
The appraisal process represents a logical analysis of the factors that bear upon the present value
of real estate. In this process, three basic approaches are typically used by appraisers: 1) the
Cost Approach, 2) the Income Capitalization Approach, and 3) the Sales Comparison Approach.
The Cost Approach is based upon the proposition that an informed purchaser would pay no more
than the cost of producing a substitute property with the same utility as the subject. First, the
subject’s site is valued (as if vacant) by comparing it to the sale of similar sites using the Direct
Sales Comparison Approach. The reproduction cost new is then estimated for the subject
improvements, and from this, an amount is deducted for depreciation from all causes to arrive at
a value via the Cost Approach.
The Sales Comparison Approach is based upon the proposition that an informed purchaser would
pay no more for a property than the cost to him of acquiring a similar property with the same utility.
In this approach, similar properties that have recently sold are compared to the subject. Notable
differences in the utilized comparables are adjusted to the subject in the process. Comparisons
are made and are typically based upon the terms of sale, age, location, size, financing, and
physical characteristics. The adjustments are abstracted from and/or otherwise supported to
represent the actions of buyers and sellers in the market. The value range that is indicated by
the adjusted comparable sales is correlated or reconciled into a final value opinion via this
approach.
The Income Capitalization Approach is the process in which the anticipated flow of future benefits
(dollar income or amenities) is discounted to a present worth figure through a capitalization or
direct discount procedure. All expenses attributable to the real estate are deducted from an
effective gross income estimate to arrive at forecasts of applicable net income streams. The net
income streams are then “capitalized” or discounted into value by market abstracted rates. The
purpose of ownership is to generate income and provide to the owner a sufficient return on his/her
investment to make the purchase of such a property attractive.
To complete this appraisal assignment, the Cost, Income Capitalization, and Sales Comparison
Approaches were considered, while the Cost and Sales Comparison Approaches were utilized.
The exclusion of the Income Capitalization Approach to Value is considered reasonable and its
exclusion should not mislead the user of this appraisal. The exclusion of the Income Capitalization
Approach is considered reasonable due to the subject property being a special use property and
being owned by a government entity. The appraiser’s scope of work decision involved the
exclusion of the Income Capitalization Approach due to the fact that this approach would provide
a less reliable indication of value than the other two approaches.
SECTION IV – COST APPROACH
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DESCRIPTION OF THE COST APPROACH
The premise of the Cost Approach is that a typically informed purchaser would pay no more for
the property being appraised than the cost of producing a substitute property with the same utility.
This method is most applicable as an indicator of market value when the property being appraised
involves relatively new improvements representing the highest and best use of the land. The
method generally is less applicable for older properties since the likelihood of encountering
physical, functional, and/or locational value loss tends to increase with property age. The greater
the incidence of such loss factors, the less reliable the final value approach indication is since
quite often these loss factors cannot be finitely measured.
The general methodology of the cost analysis in the appraisal procedure involves the division of
the property being appraised into basic elements of a) land, and b) improvements. The steps in
this methodology are:
1) Estimate the value of the site as vacant and ready for improvements.
2) Estimate the current cost to reproduce the improvements.
3) Estimate the dollar amount of accrued depreciation attributable to the following:
a) Physical deterioration
b) Functional obsolescence
c) Locational (Economic) obsolescence
4) Deduct the total amount of accrued depreciation from the current reproduction cost to
derive the present depreciated cost of the improvements.
5) Derive an indication of value for the property by adding the land value estimate and
the estimate of the depreciation cost of the improvements.
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LAND VALUATION
“Sales comparison is usually the preferred methodology for developing an opinion of site value.
When this method is used, most of the techniques for selecting comparable sales and making
adjustments that are described in Chapter 20 [of The Appraisal of Real Estate, Fifteenth Edition]
can be applied to site valuation. When there are not enough sales of similar parcels for the
application of sales comparison, alternative methods such as market extraction, allocation, land
residual analysis, and various income capitalization techniques may be used.” 9 All of these land
valuation procedures, which are summarized below, are derived from the three traditional
approaches to value.
– Sales Comparison – Sales of similar, vacant parcels are analyzed, compared, and
adjusted to provide a value indication for the land being appraised.
– Market Extraction – An estimate of the contributory value of improvements is deducted
from the total sale price of a property to arrive at an indicated land value for the
comparable. The indicated land values of the comparables are then compared to
provide a value indication for the land being appraised.
– Allocation – A ratio of site value to property value is extracted from comparable sales
in competitive locations and applied to the value of the improved subject property or
comparable properties to develop the site value.
– Direct Capitalization: Land Residual Analysis – The net operating income attributable
to the land is capitalized or the cost to construct an improvement is deducted from the
value as if completed to produce an indication of the land’s contribution to the total
property.
– Direct Capitalization: Ground Rent Capitalization – A market-derived capitalization rate
is applied to the ground rent of the subject property.
– Yield Capitalization: Discounted Cash Flow Analysis-Subdivision Development
Analysis – Direct and indirect costs and entrepreneurial incentive are deducted from
an estimate of the anticipated gross sales price of the finished lots or units, and the
net sales proceeds are discounted to present value at a market-derived rate over the
development and absorption period. If entrepreneurial incentive is not deducted as a
line-item expense, then the discount rate must reflect the full effect of any profit.
When sufficient market data is available, the best method of site valuation is the Sales
Comparison Approach. This method calls for comparison weighing and relating sales data to the
site being appraised. The data can be analyzed and the indications of adjustments for time,
location, physical utility and conditions of sale, can then be applied so as to result in a meaningful
value opinion for the subject site. For a sale to be truly comparable, the highest and best use of
the comparable land should be the same or similar to the appraised site. This is the method of
site valuation, which will be utilized in this report.
9 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, pages 339.
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COMPARABLE LAND SALES PRESENTATION
The subject market was searched for sales of tracts of land most comparable to the subject. After
sales were selected for more analysis, the public records were researched and verification of the
details of the sales was obtained from parties knowledgeable concerning the sales. We then
analyzed the specific differences and made appropriate adjustments, abstracting these
adjustments from the market whenever possible. The final reconciliation of these adjusted sales
indicated a value of the subject property. A map depicting the location of the sales in comparison
to the subject property is located below.
Date Size Sales
Map #of Sale (Acres)Price/SF
1 8/23/24 1.250 $8.26
2 7/8/24 25.000 $8.12
3 6/3/24 11.580 $0.69
S -11.375 Subject
Map Comparable Summary
S
S
S
S
S
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Location (Physical):1498 N Mayhill Rd
Denton, Texas
Legal Description:A0417A M. Forrest, TR 275, 1.25
acres, old DCAD TR 8F, Blk A
Grantor:Helayas Logistics LLC
Grantee:N/AV
Date of Sale:August 23, 2024 Sales Price:
Recording Information:N/AV Participant's Sale Terms:Cash to Seller
Property Rights Conveyed:Fee Simple Estate Cash Equivalent Price:
Conditions of Sale:Arm's Length Transaction Intended Use:Industrial
Road Frontage:N Mayhill Rd Size of the Tract:1.250 acres
Configuration:Rectangular 54,450 square feet
Flood Plain:None Improvements:None
Topography:Level Utilities:All Available
Zoning:LI, Light Industrial
Actual Sales Price Per Sq. Ft.:$8.26
Cash Equivalent Price Per Sq. Ft.:$8.26
Contact Person:Ben Zamora Telephone Number:
Position:Listing Broker
COMPARABLE LAND SALE NUMBER 1
PROPERTY IDENTIFICATION
TRANSACTION DATA
$450,000
$450,000
PHYSICAL CHARACTERISTICS
UNITS OF COMPARISON
VERIFICATION
(972) 999-3052
COMMENTS
This property is physically located on the east line of North Mayhill Road, south of US 380 in Denton, Texas. This tract has a municipal address of
1498 North Mayhill, Denton, Texas. This property reportedly sold for $450,000, or approximately $8.26 per square foot. The deed was not available
for this comparable at the time of this report. The sales info was confirmed with the listing broker.
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Location (Physical):3630 Duchess Dr
Denton, Texas
Legal Description:Pecan Creek Business Park Blk B
Grantor:K&C Triple Crown Partners LP & John
Rainey
Grantee:N/A
Date of Sale:July 8, 2024 Sales Price:
Recording Information:N/A Participant's Sale Terms:Cash to Seller
Property Rights Conveyed:Fee Simple Estate Cash Equivalent Price:
Conditions of Sale:Arm's Length Transaction Intended Use:Multifamily
Road Frontage:Duchess Dr Size of the Tract:25.000 acres
Configuration:Irregular 1,089,000 square feet
Flood Plain:40%Improvements:None
Topography:Level Utilities:All Available
Zoning:SC, Suburban Corridor
Actual Sales Price Per Sq. Ft.:$8.12
Cash Equivalent Price Per Sq. Ft.:$8.12
Contact Person:John Withers Telephone Number:
Position:Listing Broker
COMPARABLE LAND SALE NUMBER 2
PROPERTY IDENTIFICATION
TRANSACTION DATA
$8,842,680
$8,842,680
COMMENTS
This property is physically located on the south line of Duchess Drive, west of Loop 288 in Denton, Texas. This tract has a municipal address of
3630 Duchess Drive, Denton, Texas. This property reportedly sold for $8.12 per square foot or approximately $8,842,680. The deed was not
available for this comparable at the time of this report. The sales info was confirmed with the listing broker.
PHYSICAL CHARACTERISTICS
VERIFICATION
(940) 400-7824
UNITS OF COMPARISON
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Location (Physical):5034 Corbin Rd
Denton, Texas
Legal Description:A0357A Dougherty, TR 2A
Grantor:Moises Flores
Grantee:Mupparaju, Veerendra & Inapuri, Vijaya S
TRS Mupparaju & Inapuri
Date of Sale:June 3, 2024 Sales Price:
Recording Information:Deed # 2024-58613 Participant's Sale Terms:Cash to Seller
Property Rights Conveyed:Fee Simple Estate Cash Equivalent Price:
Conditions of Sale:Arm's Length Transaction Intended Use:Investment
Road Frontage:Corbin Rd Size of the Tract:11.580 acres
Configuration:Triangular 504,425 square feet
Flood Plain:75%Improvements:None
Topography:Level Utilities:All Available
Zoning:Industrial
Actual Sales Price Per Sq. Ft.:$0.69
Cash Equivalent Price Per Sq. Ft.:$0.69
Contact Person:Ben Zamora Telephone Number:
Position:Listing Broker
UNITS OF COMPARISON
VERIFICATION
(972) 999-3052
$350,000
PHYSICAL CHARACTERISTICS
TRANSACTION DATA
$350,000
COMMENTS
This property is physically located on the east line of Corbin Road, south of Shelby Lane in Denton, Texas. This tract has a municipal address of
5034 Corbin Road, Denton, Texas. This property reportedly sold for $350,000 or approximately $0.69 per square foot.
COMPARABLE LAND SALE NUMBER 3
PROPERTY IDENTIFICATION
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LAND SALES ANALYSIS
The process of comparing similar market sales to the subject property is fundamental to the sales
comparison approach, and usually provides the most credible and reliable indication of value. If
a comparable property has an element of comparison that is superior to the subject property, a
downward adjustment is made to the comparable sale. If the element of comparison is inferior,
then an upward adjustment is made. The adjustment process is not an exact science. Experience,
knowledge and objectivity are required on the part of the appraiser for the application of the
appropriate level of adjustment. Competent analysis leads us to a narrow range of variance
among the adjusted comparable sales, and to a high degree of confidence in reconciliation. The
analyses of the adjustments we considered relevant are found in the following paragraphs.
Financing Terms
All of the comparable land sales were consummated with the sellers effectively receiving cash in
exchange for their consideration in the property; therefore, no adjustments were required for
advantageous seller financing.
Property Rights Conveyed
This adjustment involves the type of real property interest that is conveyed in a sales transaction.
All of the comparable transactions conveyed fee simple ownership rights; thus, no adjustments
were required for this factor.
Conditions of Sale
Adjustments for this item usually reflect the motivation of the buyer and seller involved with a
transaction. Adjustments would be necessary for transactions where the seller wants to quickly
liquidate his assets or where there is an atypical financial, business, friend or family relationship
between the principals involved which affect the selling price of the property. All of the
Comparables had similar conditions of sale to that of the subject and will not be adjusted.
Sales
Sale Location Date Size Flood Price
No.(Physical)of Sale (Acres)Utilities Zoning Topography Plain PSF Intended Use
1 1498 N Mayhill Rd 8/23/24 1.250 All Available LI, Light Industrial Level None $8.26 Industrial
Denton, Texas
2 3630 Duchess Dr 7/8/24 25.000 All Available SC, Suburban Corridor Level 40%$8.12 Multifamily
Denton, Texas
3 5034 Corbin Rd 6/3/24 11.580 All Available Industrial Level 75%$0.69 Investment
Denton, Texas
Subject:300 S Woodrow Ln -11.375 All Available PF, Public Facilities Sloping 95%--
Denton, Texas
Summary of
Comparable Sales
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Expenditures After Sale
This adjustment accounts for any expenses the purchaser of the property occurs immediately
after the purchase of the property. Some examples of these items could include environmental
clean-up, demolition costs, deferred maintenance, HVAC replacement/repair, renovations,
parking lot repair/replacement, cosmetic upgrades, etc... Adjustments for this item usually reflect
the motivation of the buyer and seller involved with a transaction. Adjustments would be
necessary for transactions where the buyer is aware that such expenditures after the sale must
occur in order to operate the property sufficiently. Any necessary adjustments for Expenditures
After Sale have been made within the individual Comparable write-ups. Therefore, no further
adjustments are necessary.
Market Conditions
This adjustment is generally made after the other transactional adjustments have been made
(property rights conveyed, financing, conditions of sale, and expenditures after sale). This
adjustment addresses potentially differing market conditions between the subject property (date
of appraisal), and the sales dates of the Comparables. As a test, the sales adjusted prices when
compared to the subject were chronologically arrayed by sale date and only adjusted for the
appropriate physical conditions in order to determine if adjustments for changing market
conditions is warranted.
The table below depicts the Price/Sq. Ft. for each comparable which has been adjusted for the
other transactional adjustments (property rights conveyed, financing, conditions of sale, and
expenditures after sale). The % Physical Adjustment column indicates the total adjustments made
for all physical characteristics (location, size, corner, utilities, topography zoning, flood plain, etc.)
as shown in the adjustment grid at the conclusion of this section of the report. The Adjusted
Price/Sq. Ft. is calculated by applying the % Physical Adjustment for each sale to its Price/Sq. Ft.
By analyzing the comparable sales adjusted prices per square foot after all other adjustments
have been made, trends in land prices over the time period may become apparent. However,
given the small sample size, the appraisers’ judgment is also relied upon based upon knowledge
gained from experience in the market over this time period.
Comparable Date Unadjusted Physical %Adjusted
Number of Sale Price/Sq. Ft.*Adjustment Price/Sq. Ft.
Comparable 1 August 23, 2024 $8.26 -74%$2.15
Comparable 2 July 8, 2024 $8.12 -32%$5.52
Comparable 3 June 3, 2024 $0.69 0%$0.69
*Inclusive of any necessary transactional adjustments
Market Conditions Comparison
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In closely analyzing the market Comparables, there is not a clear trend in sales prices over this
time period. Additionally, market participants indicate that market conditions have been improving
at a rate of approximately 4 to 6 percent per year. Therefore, each Comparable will be adjusted
upwards by 5 percent per year. Therefore, in our opinion, the market conditions adjustments are
considered reasonable.
Location/Access
The axiom that “location is the most important physical characteristic of real estate” suggests that
this component warrants paramount consideration in the adjustment process. Therefore, the
locations of the Comparables are the first of the physical characteristics to be considered. The
sales researched and included herein involve small acreage properties, with similar highest and
best uses as that of the subject. The subject property is physically located along the west line of
South Woodrow Lane, south of Troy H. Lagrone Drive in Denton, Texas.
Comparables 1 and 2 are located along similar roadways in similar areas of surrounding
development to the subject. Therefore, Comparables 1 and 2 will not be adjusted. Comparable 3
is located along an inferior roadway in an inferior area of surrounding development and will be
adjusted upward 20 percent.
Size
The subject site comprises 11.375 acres or 495,495 square feet. Typically, smaller tracts sell for
more per unit than larger sites. In reviewing market trends and the data set, the market appears
to recognize a difference in price for tracts substantially different in size. A market observation
witnessed throughout the Texas market area and most metropolitan areas in the southwest
supports an adjustment of five to fifteen percent for each halving/doubling in size. In this instance
a five percent adjustment for each halving/doubling in size will be utilized. The following table
illustrates the size adjustments based upon a market derived 5 percent adjustment per each
doubling/halving in size for the land market in the vicinity.
Comparable Comparable Subject % Difference Adj. Per Indicated
Number Size (Acres)Size (Acres)In Size Halving/Doubling Adjustment
Comparable 1 1.250 11.375 -89%5%-16%
Comparable 2 25.000 11.375 120%5%6%
Comparable 3 11.580 11.375 2%5%0%
Adjustment for Size
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Corner
A tract of land with corner influence can, in many cases, command a higher price per unit than a
tract without corner influence. Corner influence typically becomes a more significant factor on
price with retail and commercial properties situated along two primary thoroughfares in
significantly developed urban areas. The subject property is not located on a corner. Like the
subject, the Comparables do not have corner location and will not be adjusted.
Utilities
The next consideration is for the location and adequacy of utilities. Each of the sales, as well as
the subject, reportedly had all utilities available. Therefore, no adjustments are warranted for
utilities.
Topography
This adjustment takes into consideration the topography (terrain) of the subject property and how
developable the site is. As mentioned previously, the topography of the subject tract is gently
sloping and should not limit the developability of the site. All of the Comparables have similar
topographical considerations to that of the subject and will not be adjusted.
Zoning
The zoning classification a property possesses dictates the legally permissible uses that a site
can be developed with, and hence, has a major influence on the value of a property. The subject
site is zoned PF, Public Facilities by the City of Denton. It should be noted that this zoning
designation is due to the subject’s ownership by a governmental entity. Therefore, the
Comparables have similar zoning restrictions compared to the subject, allowing similar
developments and will not be adjusted.
Flood Plain
The next consideration is for the adverse influence of a tract being situated within the 100 or 500
year flood plain. As discussed previously, approximately 95 percent of the subject tract lies in the
100 year flood plain or regulatory floodway. Approximately 55 percent of the subject lies within the
100 year flood plain, and approximately 40 percent of the subject lies within the regulatory
floodway. Comparable 1 is located outside of the flood plain. Additionally, approximately 40
percent of Comparable 2 and 75 percent of Comparable 3 is located in the 100 year flood plain.
To abstract the appropriate adjustment for flood plain, paired sales analysis for several flood plain
sales identified in the North Texas region have been displayed in the following table. These flood
plain sales are correlated with a very similar non-flood plain sale.
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% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%10218 Teagarden Rd, Dallas, Texas Sept 2015 16.373 $14,658 --
100%9000 Teagarden Rd, Dallas, Texas Oct 2015 20.000 $5,000 -65.9%
Divided by Percentage in Flood Plain:100%
Indicated Adjustment:-65.9%
Flood Plain Paired Comparison #1
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%Merit Dr, Dallas, Texas1 Feb 2014 1.400 $980,910 --
50%Forest Ln, Dallas, Texas Sept 2014 6.420 $778,816 -20.6%
Divided by Percentage in Flood Plain:50%
Indicated Adjustment:-41.2%
Flood Plain Paired Comparison #2
1This non-flood sale has been adjusted downward 10 percent for size.
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%Senlac Dr, Farmers Branch1 Sept 2014 3.975 $188,757 --
100%Crescent Dr, Carrollton June 2013 1.342 $144,560 -23.4%
Divided by Percentage in Flood Plain:100%
Indicated Adjustment:-23.4%
Flood Plain Paired Comparison #3
1This non-flood sale has been adjusted upward 5 percent for size and downward 5 percent for a corner location for a total net
adjustment of 0 percent.
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%Dena Dr, Frisco Dec 2013 4.440 $152,461 --
78%Meadow Hill Dr, Frisco Jan 2013 5.750 $43,478 -71.5%
Divided by Percentage in Flood Plain:78%
Indicated Adjustment:-91.6%
Flood Plain Paired Comparison #4
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%CR 95, Celina July 2003 35.330 $15,000 --
95%Business 289, Celina Oct 2002 34.820 $8,186 -45.4%
Divided by Percentage in Flood Plain:95%
Indicated Adjustment:-47.8%
Flood Plain Paired Comparison #5
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%McAlister Rd, Burleson April 2001 15.000 $14,500 --
100%FM 1187, Burlseon July 2002 22.380 $5,362 -63.0%
Divided by Percentage in Flood Plain:100%
Indicated Adjustment:-63.0%
Flood Plain Paired Comparison #6
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These paired comparisons indicated a range of roughly -23 percent to -92 percent and a mean of
approximately -52.5 percent. Therefore, a -50 percent adjustment will be utilized for the difference
in the value of land located within the 100 year flood plain, compared to land that is not located
within the flood plain. Additionally, an adjustment toward the upper end of the range, or 75 percent,
will be utilized for the portion within the regulatory floodway.
Given that only approximately 55 percent of the subject is encumbered by 100 year flood plain
and 40 percent is encumbered by regulatory floodway, a downward adjustment of 58 percent
((55% of 50%) + (40% of 75%) = 57.5% ) will be applied to Comparable 1. A downward adjustment
of 38 percent (57.5% – (40% of 50%) = 37.5%) will be applied to Comparable 2. A downward
adjustment of 20 percent (57.5% – (75% of 50%) = 20.0%) will be applied to Comparable 3.
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%Great SW Pkwy, Grand Prairie May 2000 43.720 $21,386 --
100%MacArthur Blvd, Grand Prairie Jan 2002 41.550 $9,266 -56.7%
Divided by Percentage in Flood Plain:100%
Indicated Adjustment:-56.7%
Flood Plain Paired Comparison #7
% of Tract in Size Price/
Flood Plain Location Date (Acres)Acre % Variance
0%FM 548, Forney, Texas July 2021 22.000 $40,910 --
80%FM 548, Forney, Texas Under Contract 21.000 $31,000 -24.2%
Divided by Percentage in Flood Plain:80%
Indicated Adjustment:-30.3%
Flood Plain Paired Comparison #8
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CONCLUSION OF LAND VALUE
An adjustment grid for the Comparable Land Sales is located below. The grid is followed by their
respective range, mean (average), and standard deviation of the adjusted sales prices per square
foot.
Sale Number 1 2 3
Sales Price/SF $8.26 $8.12 $0.69
Financing Terms 0.00 0.00 0.00
Property Rights Conveyed 0.00 0.00 0.00
Conditions of Sale 0.00 0.00 0.00
Expenditures After Sale 0.00 0.00 0.00
Market Conditions 0.00 0.08 0.01
Conditions Adj. Price/SF $8.26 $8.20 $0.70
Location 0%0%20%
Size -16%6%0%
Corner 0%0%0%
Utilities 0%0%0%
Topography 0%0%0%
Zoning 0%0%0%
Flood Plain -58%-38%-20%
Total Adjustment -74%-32%0%
Adjusted Price/SF $2.15 $5.58 $0.70
for Comparable Sales
Adjustment Grid
$/SF
Range $0.70 -$5.58
Mean (Average)
Standard Deviation
All Data
$2.81
$2.51
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All of the Comparables had a mean of $2.81 per square foot. Given the large amount of flood
plain present on the subject as well as Comparable 3, Comparable 3 appears the most similar
utility to the subject. Therefore, considering the foregoing analysis and giving primary
consideration to Comparable 1 a market value opinion of $1.00 per square foot is considered to
be reasonable for the subject tract. Thus, the market land value for the subject, as of the effective
date of the appraisal is calculated below:
11.375 acres (495,495 per square foot) x $1.00/SF = $495,495
Rounded to: $500,000
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SEGREGATED COST ANALYSIS
Reproduction Cost New
The cost of constructing an improvement on the date of the appraisal may be developed as the
cost to reproduce the improvement or the cost to replace it. The theoretical base for the Cost
Approach is reproduction cost, but replacement cost may also be used. There is an important
distinction between the terms.
Reproduction Cost is the estimated cost to construct, as of the effective appraisal date, an exact
duplicate or replica of the building being appraised, insofar as possible, using the same materials,
construction standards, design, layout, and quality of workmanship, and embodying all the
deficiencies, superadequacies, and obsolescence of the subject improvements.10
Replacement Cost is the estimated cost to construct, as of the effective appraisal date, a
substitute for the building being appraised using contemporary materials, standards, design, and
layout. 11
The use of replacement cost eliminates the need to estimate some forms of functional
obsolescence but does not affect the necessity to measure other forms of functional
obsolescence, or physical deterioration and external obsolescence. Although reproduction cost
is sometimes difficult to estimate because identical materials are not available, or construction
standards have changed, the use of the procedure generally provides a basis from which
depreciation from all causes can be measured.
The estimated reproduction cost new is based primarily upon the Marshall Valuation Service and
a comparison with the cost of other similar properties. The Marshall Valuation Service is a national
cost estimator service in which the net leasable and non-leasable areas, such as site work,
landscaping and parking areas, are entered and described. The Marshall Valuation Service takes
into account such factors as architectural fees and quality of construction. Reproduction costs
include all direct and estimated indirect costs of the project. Located on the following pages is a
copy of the Marshall Valuation Service Segregated Cost estimate for the subject facility. The
following is a brief summary of the Marshall Cost Program, showing the building occupancy, size,
cost rank, number of stories, height, age, and condition of the improvements:
10 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, pages 533.
11 Ibid., page 33.
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As is detailed above and on the previous pages, the reproduction cost of the subject, was
$700,240. The total reproduction cost for the subject building is comprised of the direct, or “hard”,
costs as well as some indirect, or “soft”, costs involved in constructing buildings such as the
subject. Indirect or “soft” costs are comprised of construction loan interests charges, construction
loan points, permanent loan points, professional fees, and entrepreneurial profit.
Entrepreneurial Profit, Marketing, and Contingencies
Certain indirect costs (soft costs) are associated with the reproduction costs previously described.
Entrepreneurial profit is typically included in the Cost Approach as payment for a necessary
economic factor of production and represents the amount of compensation and risk reward that
a prudent entrepreneur would require in order to make it worthwhile to go to the effort of
developing the project.
Soft costs, which consist of contingencies, marketing, professional, and legal fees, as well as
financing costs, have been estimated to be approximately 10 percent of hard costs. Furthermore,
an estimate of the profit incentive is necessarily subjective and is considered to be approximately
10 percent of construction costs (hard and soft costs). According to these analyses, the
reproduction cost new for the subject facility is calculated as follows:
Depreciation Estimate
All types of depreciation affecting the subject improvements were considered. “Depreciation is the
difference between the contributory value of an improvement and its cost at the time of appraisal.”
12 Depreciation is divided into three basic categories: physical deterioration (which includes
curable and incurable), functional obsolescence (including curable and incurable), and economic
obsolescence (which is almost always incurable). The following is a discussion of each type of
depreciation and the observed depreciation applicable to the subject property.
Physical Deterioration
Curable physical deterioration refers to items of deferred maintenance; the estimate of curable
physical deterioration is applicable only to the items which are subject to current repair. Thus, the
measure of this element of accrued depreciation is the cost of restoring an item to new or
reasonably new condition (that is, the cost to cure). Curable physical deterioration considers
items which a prudent purchaser would anticipate correcting immediately upon the acquisition of
12 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, page 539.
Total Hard Costs $700,240
Plus: Soft Costs 10%70,024
Total Hard & Soft Costs $770,264
Plus: Entrepreneurial Profit 10%77,026
Total Construction Costs $847,290
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a property. It is assumed that the cost affecting the correction would not be any greater than the
anticipated gain in value accrued by virtue of correcting the problem. Due to the subject property
involving a newly completed facility, there are no items of physical deterioration, curable. Incurable
physical deterioration refers to those items of physical deterioration which cannot be physically
and/or economically corrected. Items that evidence incurable physical deterioration are classified
as long-lived and short-lived. A long-lived (L.L.) item is a component that is expected to have a
remaining physical life that is the same as that of the entire structure. A short-lived (S.L.) item is
a component that is expected to have a remaining physical life that is shorter than the remaining
physical life of the entire structure. Whether items of physical deterioration (other than items of
deferred maintenance) are classified as curable or incurable, deterioration in short-lived items
must be measured consistently. Moreover, each element of the structure must be measured only
once. Estimates of depreciation for long-lived and short-lived items are detailed in the charts
below:
Therefore, depreciation estimated totals $729,222.
Functional Obsolescence
Functional obsolescence is the adverse effect on value resulting from defects in design. It can
also be caused by changes that, over time, have made some aspect of a structure, material, or
design obsolete by current standards. The defect may be curable or incurable. To be curable,
the cost of replacing the outmoded or unacceptable aspect must be at least offset by the
anticipated increase in value. The measure of curable functional obsolescence is the cost to
effect the cure. Curable functional obsolescence may be subclassified into the following:
a. Deficiency requiring additions, which is measured by the excess of the cost of the
addition over the cost of installed new during construction.
Reproduction Effective Economic Depreciation
Item Cost New Age/Years Life/Years Percent
Floor Cover:$25,584 15 20 75.00%$19,188
HVAC System:75,440 15 20 75.00%56,580
Roof Cover:25,440 10 20 50.00%12,720
Total:$126,464 $88,488
Incurable Physical Deterioration, Factor, SL:$88,488
Depreciation
Reproduction Cost New:$847,290
Less: Reproduction Cost New, SL:126,464
Reproduction Cost New, LL:$720,826
Percent Depreciation:88.89%
Incurable Physical Deterioration Factor, LL:$640,734
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b. Deficiency requiring substitution or modernization, which is measured by the cost of
installing the modern fixture less the depreciated value, if any, of the existing fixture or
component.
c. Superadequacy, which is measured by the current reproduction cost of the item less
any physical deterioration already charged plus the cost to install a normally adequate
or standard item. Superadequacy is curable only if curing it on the date of the appraisal
is economically feasible; otherwise, it is considered incurable.
Incurable, functional obsolescence involves items of inutility which it would not be economical to
correct because the value would not increase as much as the cost of the correction. Upon an
inspection of the subject improvements, the subject property is functional in terms of its design
and layout. Therefore, there were no items of functional obsolescence noted in the design and
layout of the subject property.
External Obsolescence
Influences that are external to the property can cause a loss in value to any property. External
obsolescence, the result of the diminished utility of a structure due to negative influences from
outside the property, is almost always incurable. To measure this obsolescence the rent loss is
typically capitalized due to the external factor for the pro rata share applicable to the improvement.
“External obsolescence is a loss in value caused by negative externalities, i.e., factors outside a
property.” 13 These influences include environmental or economic forces which impair the
desirability of the subject property. The forces can encompass a neighborhood or, as in the case
of the subject, an entire region. The total loss in value due to external obsolescence affects both
the improvements and the land and must be allocated between them.
13 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, page 591.
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CONCLUSION OF THE COST APPROACH
The reproduction cost estimate given on the previous pages has been estimated by utilizing the
Marshall & Swift Program. The addition of the depreciated cost of the improvements to the value
of the land yields a market value from the Cost Approach as follows:
Cost Approach
Summary
Total Hard Costs $700,240
Plus: Soft Costs 10%70,024
Total Hard & Soft Costs $770,264
Plus: Entrepreneurial Profit 10%77,026
Total Construction Costs $847,290
Less: Depreciation
Physical, Curable $0
Physical, Incurable (S.L.)88,488
Physical, Incurable (L.L.)640,734
Functional, Curable Obsolescence 0
Functional, Incurable Obsolescence 0
External Obsolescence 0
Total Depreciation $729,222
Depreciated Cost of Improvements $118,068
Plus: Land Value 500,000
Value Opinion Via Cost Approach $618,068
Rounded to:$620,000
SECTION V - SALES COMPARISON APPROACH
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DESCRIPTION OF THE SALES COMPARISON APPROACH
The Sales Comparison Approach, as it applies to the subject property, is based upon the premise
that the market value of the subject property can be estimated by analyzing sales of similar
properties. The principle of substitution is basic in this approach as it implies that a prudent person
will not pay more for a property than would be required for an acceptable alternative available in
the market. In the Sales Comparison Approach, the following methodology is used. An appraiser
follows a systematic procedure, comparing like with like. That is, the appraisers must adjust each
comparable property to the subject property to impute an indicated value to the subject property.
The steps of the procedure are as follows:
1) Research the competitive market for information on properties that are similar to
the property being appraised and that have been sold recently, or were listed for
sale, or are under contract. The characteristics of the properties such as property
type, date of sale, size, physical condition, location, and land use constraints
should be considered.
2) Verify the information by confirming that the data obtained is factually accurate and
that the transactions reflect arm’s-length market considerations.
3) Select the most relevant units of comparison used by participants in the market
(e.g., price per acre, price per square foot, price per front foot, price per dwelling
unit, price per lot or proposed lot, price per room) and develop a comparative
analysis for each unit.
4) Look for differences between the comparables being considered and the subject
property using all appropriate elements of comparison. Then adjust the price of
each comparable, reflecting how it differs to equate it to the subject property or
eliminate that property as a comparable.
5) Reconcile the various value indicators produced from the analysis of comparables
into a value indication from the sales comparison approach. A value can be
expressed as a single point estimate, as a range of values, or in terms of a
relationship (e.g., more or less than a given amount). 14
The procedure of comparative analysis typically is based upon various "units of comparison"
extracted from the market data. In the subject case, the Price Per Square Foot unit of comparison
is extracted since it appears to be the most recognized units of comparison by the commercial
markets. Typically, it is a reliable unit of comparison when the properties improvements are similar
in size, location, condition, quality, and age.
There are several approaches to application of the Sales Comparison Approach. One method of
valuation by the Sales Comparison Approach is to divide the estimated net income by the
purchase price with the result equaling the overall rate of each transaction studied. This gives an
overall rate of return used for direct capitalization in the Income Approach to value.
14 The Appraisal Institute, The Appraisal of Real Estate (Fifteenth Edition), Chicago, Illinois, 2020, pages 355.
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COMPARABLE IMPROVED SALES PRESENTATION
The subject market was searched for sales of comparable buildings similar in size, occupancy,
and tenant orientation to the subject. During our investigation, we were able to confirm information
on several buildings. Located on the following pages of this report are complete descriptions of
each of these Comparables. Presented below is a map depicting the location of each of the
Comparables.
Date Sales
Map #of Sale Size (SF)Price PSF
1 10/4/23 5,488 $54.66
2 3/8/23 4,311 $69.59
3 2/28/23 4,424 $90.42
4 1/4/23 9,127 $71.21
5 8/12/22 6,500 $50.00
S -8,000 Subject
Map Comparable Summary
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24.0804 86
PROPERTY IDENTIFICATION
Location:600 W Main St
Whitesboro, Texas
Legal Description:Madelyn Addition replat BLK 53 & part
of BLK 52 Crenshaw, BLK 52, LOT 5,
ACRES 1.362
TRANSACTION DATA
Grantor:Gray-Den Bldg & Leasing
Grantee:Talley Land Development Ltd.
Date of Sale:October 4, 2023
Recording Information:Deed # 2023-26880
Property Rights Conveyed:Fee Simple Estate
Conditions of Sale:Arm's Length Transaction
Sales Price:$300,000
Participant's Sale Terms:Cash to Seller
Cash Equivalent Price:$300,000
PHYSICAL CHARACTERISTICS
Type of Construction:Brick/Siding Net Rentable Area:5,488 square feet
Condition and Appearance:Average Space Available:0 square feet
Year of Construction:1984 Percent Occupied @ Sale:100.0%
Renovation/Expansion:N/A Percent Unfinished Shell:0.0%
Tenant Orientation:Single-Tenant Land Area:1.362 acres
Loading Facilities:GL Land-to-Building Ratio:10.81 to 1.0
Clear Height 15'Percent Office Ratio:20%
Parking, Drives, & Loading:Open Surface, Concrete Percent HVAC:100%
Access and Visibility:Good
INCOME INFORMATION Stabilized Per
Income & Expenses Projections Sq. Ft.
Potential Gross Income (PGI)$23,982.56 $4.37
Vacancy & Collection Loss 719.48 0.13 3%
Effective Gross Income (EGI)$23,263.08 $4.24
Less: Operating Expenses 10,976.00 2.00
Plus: Reimbursables 1,372.00 0.25
Net Operating Income (NOI)$13,659.08 $2.49
UNITS OF COMPARISON
Units of Comparison Actual Adjusted
Sales Price Per Square Foot:$54.66 $54.66
Gross Rent Multiplier:12.51 12.51
Overall Capitalization Rate:4.55%4.55%
Expense to Income Ratio:43.05%43.05%
1-(NOI/PGI)
VERIFICATION
Contact Person:Bob Alexander Telephone Number:
Position:Listing Broker
COMMENTS
COMPARABLE SALE NUMBER 1
(214) 212-9226
This property is located along the south line of West Main Street, west of Chestnut Street in Whitesboro, Texas. The property reportedly sold for
$300,000, or approximately $54.66 per square foot. At the time of purchase, there was an existing lease in place until July 2024 at $2,000 per
month. Expenses were estimated based on similar properties.
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PROPERTY IDENTIFICATION
Location:817 N Grand Ave
Gainesville, Texas
Legal Description:Woodsmith; Blk 7, Lot 8, 9, & 12
TRANSACTION DATA
Grantor:Gainesville Hospital District
Grantee:Grand Avenue Investments LLC
Date of Sale:March 8, 2023
Recording Information:Deed # 202300001508
Property Rights Conveyed:Fee Simple Estate
Conditions of Sale:Arm's Length Transaction
Sales Price:$300,000
Participant's Sale Terms:Cash to Seller
Cash Equivalent Price:$300,000
PHYSICAL CHARACTERISTICS
Type of Construction:Masonry Net Rentable Area:4,311 square feet
Condition and Appearance:Average Space Available:4,311 square feet
Year of Construction:1969 Percent Occupied @ Sale:0.0%
Renovation/Expansion:N/A Percent Unfinished Shell:0.0%
Tenant Orientation:Multi-Tenant Land Area:0.460 acres
Loading Facilities:None Land-to-Building Ratio:4.65 to 1.0
Clear Height 8'Percent Office Ratio:50%
Parking, Drives, & Loading:Open Surface, Asphalt Percent HVAC:100%
Access and Visibility:Good
INCOME INFORMATION Stabilized Per
Income & Expenses Projections Sq. Ft.
Potential Gross Income (PGI)$30,177.00 $7.00
Vacancy & Collection Loss 905.31 0.21 3%
Effective Gross Income (EGI)$29,271.69 $6.79
Less: Operating Expenses 15,088.50 3.50
Plus: Reimbursables 2,155.50 0.50
Net Operating Income (NOI)$16,338.69 $3.79
UNITS OF COMPARISON
Units of Comparison Actual Adjusted
Sales Price Per Square Foot:$69.59 $69.59
Gross Rent Multiplier:9.94 9.94
Overall Capitalization Rate:5.45%5.45%
Expense to Income Ratio:45.86%45.86%
1-(NOI/PGI)
VERIFICATION
Contact Person:Misty Schmitz Telephone Number:
Position:Listing Broker
COMMENTS
COMPARABLE SALE NUMBER 2
This property is located along the west line of North Grand Avenue, south of Olive Street in Gainesville, Texas. The property reportedly sold for
$300,000, or approximately $69.59 per square foot. Income and expenses were estimated based on similar properties.
(940) 665-6730
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PROPERTY IDENTIFICATION
Location:117 2nd St
Krum, Texas
Legal Description:O T Krum Blk 19 Lot 5 (w PT), 6
TRANSACTION DATA
Grantor:Moonlighters LLC
Grantee:Canvasback Holdings LLC
Date of Sale:February 28, 2023
Recording Information:Deed # 2023-20169
Property Rights Conveyed:Fee Simple Estate
Conditions of Sale:Arm's Length Transaction
Sales Price:$400,000
Participant's Sale Terms:Cash to Seller
Cash Equivalent Price:$400,000
PHYSICAL CHARACTERISTICS
Type of Construction:Metal Net Rentable Area:4,424 square feet
Condition and Appearance:Average Space Available:0 square feet
Year of Construction:1970 Percent Occupied @ Sale:100.0%
Renovation/Expansion:N/AV Percent Unfinished Shell:0.0%
Tenant Orientation:Single-Tenant Land Area:0.173 acres
Loading Facilities:GL Land-to-Building Ratio:1.70 to 1.0
Clear Height 15'Percent Office Ratio:20%
Parking, Drives, & Loading:Open Surface, Asphalt Percent HVAC:100%
Access and Visibility:Good
INCOME INFORMATION Stabilized Per
Income & Expenses Projections Sq. Ft.
Potential Gross Income (PGI)$35,392.00 $8.00
Vacancy & Collection Loss 1,061.76 0.24 3%
Effective Gross Income (EGI)$34,330.24 $7.76
Less: Operating Expenses 11,060.00 2.50
Plus: Reimbursables 1,106.00 0.25
Net Operating Income (NOI)$24,376.24 $5.51
UNITS OF COMPARISON
Units of Comparison Actual Adjusted
Sales Price Per Square Foot:$90.42 $90.42
Gross Rent Multiplier:11.30 11.30
Overall Capitalization Rate:6.09%6.09%
Expense to Income Ratio:31.13%31.13%
1-(NOI/PGI)
VERIFICATION
Contact Person:Cathy Green Telephone Number:
Position:Listing Broker
COMMENTS
COMPARABLE SALE NUMBER 3
This property is located along the west line of 2nd Street, south of West Lake Street in Krum, Texas. The property reportedly sold for $400,000, or
approximately $90.42 per square foot. Income and expenses were estimated based on similar properties.
(817) 228-9936
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PROPERTY IDENTIFICATION
Location:7938 Lake June Rd
Dallas, Texas
Legal Description:Dallas Gardens Blk B/6301 E24FT Lot
13 & All
TRANSACTION DATA
Grantor:Raul & Leticia Martinez
Grantee:Martina Salazar Lopez
Date of Sale:January 4, 2023
Recording Information:Deed # INT202200324607
Property Rights Conveyed:Fee Simple Estate
Conditions of Sale:Arm's Length Transaction
Sales Price:$649,900
Participant's Sale Terms:Cash to Seller
Cash Equivalent Price:$649,900
PHYSICAL CHARACTERISTICS
Type of Construction:Brick Net Rentable Area:9,127 square feet
Condition and Appearance:Average Space Available:9,127 square feet
Year of Construction:1953 Percent Occupied @ Sale:0.0%
Renovation/Expansion:N/A Percent Unfinished Shell:0.0%
Tenant Orientation:Multi-Tenant Land Area:0.373 acres
Loading Facilities:GL Land-to-Building Ratio:1.78 to 1.0
Clear Height 8'Percent Office Ratio:70%
Parking, Drives, & Loading:Open Surface, Asphalt Percent HVAC:70%
Access and Visibility:Good
INCOME INFORMATION Stabilized Per
Income & Expenses Projections Sq. Ft.
Potential Gross Income (PGI)$109,524.00 $12.00
Vacancy & Collection Loss 3,285.72 0.36 3%
Effective Gross Income (EGI)$106,238.28 $11.64
Less: Operating Expenses 54,762.00 6.00
Plus: Reimbursables 4,563.50 0.50
Net Operating Income (NOI)$56,039.78 $6.14
UNITS OF COMPARISON
Units of Comparison Actual Adjusted
Sales Price Per Square Foot:$71.21 $71.21
Gross Rent Multiplier:5.93 5.93
Overall Capitalization Rate:8.62%8.62%
Expense to Income Ratio:48.83%48.83%
1-(NOI/PGI)
VERIFICATION
Contact Person:Danny Perez Telephone Number:
Position:Listing Broker
COMMENTS
COMPARABLE SALE NUMBER 4
(972) 772-6025
This property is located along the south line of Lake June Road, west of Buckner Boulevard in Dallas, Texas. The property reportedly sold for
$649,900, or approximately $71.21 per square foot. Income and expenses were estimated based on similar properties.
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PROPERTY IDENTIFICATION
Location:7212 FM 2450
Sanger, Texas
Legal Description:A0802A JCP Melton, Tr 24, 1.096
acres, Old DC
TRANSACTION DATA
Grantor:Mark Morris
Grantee:3Green Properties LLC
Date of Sale:August 12, 2022
Recording Information:Deed # 2022-118356
Property Rights Conveyed:Fee Simple Estate
Conditions of Sale:Arm's Length Transaction
Sales Price:$325,000
Participant's Sale Terms:Cash to Seller
Cash Equivalent Price:$325,000
PHYSICAL CHARACTERISTICS
Type of Construction:Metal Net Rentable Area:6,500 square feet
Condition and Appearance:Average Space Available:6,500 square feet
Year of Construction:1993 Percent Occupied @ Sale:0.0%
Renovation/Expansion:N/A Percent Unfinished Shell:0.0%
Tenant Orientation:Single-Tenant Land Area:1.096 acres
Loading Facilities:GL Land-to-Building Ratio:7.34 to 1.0
Clear Height 11' - 14'Percent Office Ratio:20%
Parking, Drives, & Loading:Open Surface, Gravel Percent HVAC:20%
Access and Visibility:Good
INCOME INFORMATION Stabilized Per
Income & Expenses Projections Sq. Ft.
Potential Gross Income (PGI)$52,000.00 $8.00
Vacancy & Collection Loss 1,560.00 0.24 3%
Effective Gross Income (EGI)$50,440.00 $7.76
Less: Operating Expenses 21,125.00 3.25
Plus: Reimbursables 1,625.00 0.25
Net Operating Income (NOI)$30,940.00 $4.76
UNITS OF COMPARISON
Units of Comparison Actual Adjusted
Sales Price Per Square Foot:$50.00 $50.00
Gross Rent Multiplier:6.25 6.25
Overall Capitalization Rate:9.52%9.52%
Expense to Income Ratio:40.50%40.50%
1-(NOI/PGI)
VERIFICATION
Contact Person:Kristopher Martin Telephone Number:
Position:Listing Broker
COMMENTS
COMPARABLE SALE NUMBER 5
(940) 367-5706
This property is located along the east line of FM 2450, south of Bar None Trail in Sanger, Texas. The property reportedly sold for $325,000, or
approximately $50.00 per square foot. Income and expenses were estimated based on similar properties.
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IMPROVED SALES ANALYSIS
Since no two properties are ever identical, dissimilarities between the subject property and the
comparable sales must be analyzed, with adjustments supported by market data. Elements of
comparison typically examined are: real property rights conveyed, financing terms, conditions of
sale, date of sale, location, physical characteristics, and income characteristics. The Comparable
Sales gathered were broken down into several units of comparison and indicators for use within
both the Sales Comparison Approach and the Income Approach to Value. A summary table of
these Sales is displayed below.
The prices per square foot exhibited by the improved Sales varied from $50.00 to $90.42 per
square foot, with an average of $67.18 per square foot.
Ideally, comparisons between the subject and sales of properties of similar age, condition,
location, occupancy rate, etc. should be made to reveal a value indication for the subject. All of
the consummated Sales will be analyzed. These Sales will be analyzed on a price per square foot
of net rentable area (NRA) basis herein below. These units of comparison were chosen due to
the usage of these indicators of value by prospective buyers of properties similar to the subject
within their investment criteria.
Real Property Rights Conveyed
This adjustment involves the type of real property interest that is conveyed in a sales transaction.
This is particularly important when the property being sold is subject to a long-term lease that is
substantially below or above the market rent for the property. However, there were no long-term
leases in effect at the time of sale which were not at market levels. Thus, no adjustments were
necessary to the sales for real property rights conveyed as they were comparable to those
available from the subject.
Sales Expense
Sale Location Date Year Year NRA Office HVAC Land to Rent Price Stabilized Adjusted to Income
No.(Address)of Sale Built Renv/Exp (SF)Finish Finish Bldg. Ratio PSF PSF NOI PSF GRM Ro Ratio
1 600 W Main St 10/4/2023 1984 N/AV 5,488 20%100%10.81 to 1.0 $4.37 $54.66 $2.49 12.51 4.55%43.05%
Whitesboro, Texas
2 817 N Grand Ave 3/8/2023 1969 N/AV 4,311 50%100%4.65 to 1.0 $7.00 $69.59 $3.79 9.94 5.45%45.86%
Gainesville, Texas
3 117 2nd St 2/28/2023 1970 N/AV 4,424 20%100%1.70 to 1.0 $8.00 $90.42 $5.51 11.30 6.09%31.13%
Krum, Texas
4 7938 Lake June Rd 1/4/2023 1953 N/AV 9,127 70%70%1.78 to 1.0 $12.00 $71.21 $6.14 5.93 8.62%48.83%
Dallas, Texas
5 7212 FM 2450 8/12/2022 1993 N/AV 6,500 20%20%7.34 to 1.0 $8.00 $50.00 $4.76 6.25 9.52%40.50%
Sanger, Texas
Subject:300 S Woodrow Ln -~1980 Multiple 8,000 20%100%61.94 to 1.0 ------
Denton, Texas
Summary of
Comparable Sales
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Financing Terms
A financing adjustment is necessary when a property is purchased and the corresponding
financing is at an interest rate which is not typical of interest rates generally available in the market
at the time of sale. All of the improved sales were purchased on an all "cash basis" or involved
financing equivalent to disinterested third party institutions. Therefore, no adjustments for cash
equivalency were considered necessary for the sales.
Conditions of Sale
Adjustments for this item usually reflect the motivation of the buyer and seller involved with a
transaction. Adjustments would be necessary for transactions where the seller wants to quickly
liquidate his assets or where there is an atypical financial, business, friend or family relationship
between the principals involved which affect the selling price of the property. All of the
Comparables were reported to be arm’s-length transactions and did not involve any unusual
conditions. Therefore, no adjustments will be made.
Expenditures After Sale
This adjustment accounts for any expenses the purchaser of the property occurs immediately
after the purchase of the property. Some examples of these items could include environmental
clean-up, demolition costs, deferred maintenance, HVAC replacement/repair, renovations,
parking lot repair/replacement, cosmetic upgrades, etc... Adjustments for this item usually reflect
the motivation of the buyer and seller involved with a transaction. Adjustments would be
necessary for transactions where the buyer is aware that such expenditures after the sale must
occur in order to operate the property sufficiently. Any necessary adjustments for Expenditures
After Sale have been made within the individual Comparable write-ups. Therefore, no further
adjustments are necessary.
Market Conditions
This adjustment is generally made after the other transactional adjustments have been made
(property rights conveyed, financing, conditions of sale, and expenditures after sale). This
adjustment addresses potentially differing market conditions between the subject property (date
of appraisal), and the sales dates of the Comparables. As a test, the sales adjusted prices when
compared to the subject were chronologically arrayed by sale date and only adjusted for the
appropriate physical conditions in order to determine if adjustments for changing market
conditions is warranted.
The table below depicts the Price/Unit for each comparable which has been adjusted for the other
transactional adjustments (property rights conveyed, financing, conditions of sale, and
expenditures after sale). The % Physical Adjustment column indicates the total adjustments made
for all physical characteristics (location, size, corner, utilities, topography zoning, flood plain, etc.)
as shown in the adjustment grid at the conclusion of this section of the report. The Adjusted
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Price/Unit is calculated by applying the % Physical Adjustment for each sale to its Price/Unit. By
analyzing the comparable sales adjusted prices per unit after all other adjustments have been
made, trends in prices over the time period may become apparent. However, given the small
sample size, the appraisers’ judgment is also relied upon based upon knowledge gained from
experience in the market over this time period.
In closely analyzing the market comparables, there does not appear to have been a substantial
increase or decrease in market prices over this time period for this property type. However, after
conversations with market participants in the area, they indicate market conditions are increasing.
Therefore, each Comparable will be adjusted upwards by 5 percent per year. Therefore, in our
opinion, the market conditions adjustments are considered reasonable.
Location
The axiom that "location is the most important physical characteristic of real estate" suggests that
this component warrants paramount consideration in the adjustment process. Therefore, the
locations of the Comparables are the first of the physical characteristics to be considered. The
subject property is physically located along the west line of South Woodrow Lane, south of Troy
H. Lagrone Drive in Denton, Texas.
Comparables 1, 2, and 5 are located in inferior areas of surrounding development to the subject;
therefore, Comparables 1, 2, and 5 will be adjusted upward 10 percent. Overall, Comparables 3
and 5 have similar locations to the subject and will not be adjusted.
Age/Condition of the Improvements
The subject improvements were constructed in approximately 1980 and have been renovated
multiple times over the life of the improvements. The improvements have an overall effective age
of 40 years (See Description of Improvements). As with any asset, as the useful life decreases,
the value follows. The comparables were compared to the subject property based upon their
respective effective ages. The difference in the age of the improvements was divided by their
effective life (45 years) in order to determine the difference in the useful life of the sales vis-a-vis
Comparable Date Unadjusted Physical %Adjusted
Number of Sale Price/Sq. Ft.*Adjustment Price/Sq. Ft.
Comparable 1 October 4, 2023 $54.66 7%$58.49
Comparable 2 March 8, 2023 $69.59 5%$73.07
Comparable 3 February 28, 2023 $90.42 -2%$88.61
Comparable 4 January 4, 2023 $71.21 1%$71.92
Comparable 5 August 12, 2022 $50.00 18%$59.00
*Inclusive of any necessary transactional adjustments
Market Conditions Comparison
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the subject property. The following calculations were done to arrive at a percentage adjustment
for differences in the effective ages of the Comparables and the subject property.
Quality of Construction
The subject improvements are constructed of a concrete foundation, brick veneer exterior walls,
and a pitched metal roof. The warehouse improvements are constructed of concrete foundations,
cinderblock and metal exterior walls, and metal roofs. Comparables 1, 2, and 4 have similar
qualities of construction to the subject and will not be adjusted. Comparable 3 and 5 have inferior
metal exteriors and will be adjusted upward 10 percent.
Land-to-Building Ratio
Based upon the improvement size of 8,000 square feet and a land area of 11.375 acres (495,495
square feet), the subject has a land-to-building ratio of 61.94 to 1.0. However, given the large
amount of flood plain present on the subject tract, the subject improvements are considered to
receive minimal benefit from its large land-to-building ratio. Therefore, the Comparables have
similar amounts of open surface parking and similar amounts of usable space; thus, no
adjustments will be made.
Size
The size of a building determines the quantity of the income stream, and generally affects the
selling price although those differences are accounted for (to a certain extent) in the per square
foot comparison used here. Typically, the cost of construction decreases as the size of a building
increases, due to economies of scale associated with large projects. Additionally, the initial
investment outlay of larger properties is more than a comparable smaller property, but slightly
lower prices on a per unit basis (i.e., square foot, unit, building, etc.) are very common. Therefore,
adjustments appear to be needed for size. Typically, adjustments for size range from 5 to 10
percent per doubling/halving as compared to the subject. In this instance, a 5 percent adjustment
for each doubling/halving of size is considered reasonable. Thus, the Comparables are adjusted
as follows:
Comparable Subject Age Econ. %% Attributable Indicated
Comparable Eff. Age Eff. Age Difference Life (Yrs)Difference to Bldg Adjustment
Number (CA)(SA)(CA-SA=AD)(EL)(AD÷EL=PD)(PAB)(PD x PAB = IA)
Comparable 1 40 40 0 50 0.00%65%0%
Comparable 2 40 40 0 50 0.00%65%0%
Comparable 3 35 40 -5 50 -10.00%65%-7%
Comparable 4 40 40 0 50 0.00%65%0%
Comparable 5 25 40 -15 50 -30.00%65%-20%
Adjustment for Age/Condition of the Improvements
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Building Amenities
This item relates to the overall quality of construction of the comparables and the amenities
associated with each. The projects have varying building features such as office ratios, amount
of HVAC, clearance heights, etc. The following table outlines the building amenities for the subject
property and each of the Comparables, as well as the percentage adjustments.
Comparable Comparable Subject % Difference Adj. Per Indicated
Number Size (SF)Size (SF)In Size Halving/Doubling Adjustment
Comparable 1 5,488 8,000 -31%5%-3%
Comparable 2 4,311 8,000 -46%5%-5%
Comparable 3 4,424 8,000 -45%5%-5%
Comparable 4 9,127 8,000 14%5%1%
Comparable 5 6,500 8,000 -19%5%-2%
Adjustment for Size
Comparable Office HVAC Clear Loading Percentage
Number Ratio Ratio Height Facilities Adjustment
Comparable 1 20%100%15'GL 0%
Comparable 2 50%100%8'None 0%
Comparable 3 20%100%15'GL 0%
Comparable 4 70%70%8'GL 0%
Comparable 5 20%20%11' - 14'GL 20%
Subject 20%100%15'GL -
Adjustment for Building Amenities
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CONCLUSION OF THE SALES COMPARISON APPROACH
An adjustment grid for the Comparable Sales is located below, followed by the range, mean
(average), and standard deviation of the adjusted sales prices per square foot.
Sale Number 1 2 3 4 5
Sales Price/SF $54.66 $69.59 $90.42 $71.21 $50.00
Financing Terms 0.00 0.00 0.00 0.00 0.00
Property Rights Conveyed 0.00 0.00 0.00 0.00 0.00
Conditions of Sale 0.00 0.00 0.00 0.00 0.00
Expenditures After Sale 0.00 0.00 0.00 0.00 0.00
Market Conditions 2.19 4.87 6.33 5.70 5.00
Conditions Adj. Price/SF $56.85 $74.46 $96.75 $76.91 $55.00
Location 10%10%0%0%10%
Age/Condition 0%0%-7%0%-20%
Quality of Construction 0%0%10%0%10%
Land-to-Building Ratio 0%0%0%0%0%
Size -3%-5%-5%1%-2%
Building Amenities 0%0%0%0%20%
Total Adjustment 7%5%-2%1%18%
Adjusted Price/SF $60.83 $78.18 $94.82 $77.68 $64.90
Adjustment Grid
for Comparable Sales
$/SF
Range $60.83 -$94.82 $64.90 -$78.18 -
Mean (Average)
Standard Deviation $7.53
$60.83 $94.82
Data Without
High and Low ExtremesAll Data
Data with Absolute
$77.88
$13.88
Adjustments <25%
$75.28
$13.35
$73.59
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All of the Comparables had a mean of $75.28 per square foot, while the mean of data without
high and low extremes is $73.59 per square foot, and the data with the least absolute adjustments
(<= 25%) had a mean of $77.88 per square foot. Therefore, considering the foregoing analysis, a
fee simple estate market value opinion of $75.00 per square foot is considered reasonable for the
subject property.
8,000 SF x $75.00/SF = $600,000
SECTION VI - VALUATION CONCLUSION
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RECONCILIATION AND FINAL OPINION OF VALUE
The subject property consists of an approximate 8,000 square foot office warehouse facility
located along the west line of South Woodrow Lane, south of Troy H. Lagrone Drive and has a
municipal address of 300 South Woodrow Lane, Denton, Denton County, Texas.
The Cost and Sales Comparison Approaches were investigated for application to the subject.
Each have limitations, but in general are considered to be reliable indicators of value. The
indicated values from the approaches for the “as is” market value are:
“As Is” Market Value:
Cost Approach ........................................................ $620,000
Sales Comparison Approach .................................. $600,000
The Cost Approach is based upon the proposition that an informed purchaser would pay no more
than the cost of producing a substitute property with the same utility as the subject. First, the
subject's site is valued (as if vacant) by comparing it to the sale of similar sites using the Direct
Sales Comparison Approach. The reproduction cost new is then estimated for the subject
improvements, and from this, an amount is deducted for depreciation from all causes to arrive at
a value via the Cost Approach.
The Sales Comparison Approach assumes that a prudent person will not pay more for the subject
property than is necessary to acquire an acceptable alternative. This approach is based upon
actual sales of similar properties. Dissimilarities between the subject property and each
comparable sale and the effect of the price are taken into consideration. This approach is also
considered to provide a reliable indication of market value for the subject.
In the final analysis, each of the approaches are considered well supported by the analysis of
market data and provide reliable indications of the market value for the subject property. However,
given that an owner-user would be the most likely purchaser of the subject as well as the age of
the subject property, the Sales Comparison Approach will be given primary emphasis. Therefore,
the market value of the fee simple estate for the subject property, as of the effective date of
appraisal, August 23, 2024, was:
“As Is” Market Value:
SIX HUNDRED THOUSAND DOLLARS
($600,000)
SECTION VII - CERTIFICATION & ASSUMPTIONS & LIMITING CONDITIONS
TODD PROPERTY ADVISORS
REAL PROPERTY ANALYSTS, INC.
24.0804 101
CERTIFICATION
The undersigned hereby certifies that, to the best of their 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 the personal, impartial unbiased professional
analyses, opinions, and conclusions of the undersigned.
3) Neither the undersigned, nor any associate of the appraiser, have any present or
prospective interest in the property that is the subject of this report, and have no personal
interest with respect to the parties involved.
4) The undersigned have no bias with respect to the property that is the subject of this report
or to the parties involved with this assignment.
5) The engagement of the undersigned in this assignment was not contingent upon developing
or reporting predetermined results.
6) All analyses, opinions, and conclusions were developed, and this report has been prepared,
in conformity with the Uniform Standards of Professional Appraisal Practice.
7) All analyses, opinions, and conclusions were developed, and this report has been prepared,
in conformity with Title XI of the Federal Financial Institutions Reform, Recovery, and
Enforcement Act of 1989 (FIRREA) and its regulations; in conformity with the Interagency
Appraisal and Evaluation guidelines issued by the Office of the Comptroller of the Currency
(OCC), the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit
Insurance Corporation (FDIC), the Office of Thrift Supervisions (OTS), and the National
Credit Union Administration (NCUA) on December 2, 2010.
8) The reported analyses, opinions, and conclusions were developed, and this report has been
prepared, in conformity with the Code of Professional Ethics and Standards of Professional
Appraisal Practice of the Appraisal Institute.
9) The use of this report is subject to the requirements of the Appraisal Institute relating to
review by its duly authorized representatives.
10) No one provided significant real property appraisal assistance in the preparation of this
appraisal report to the person(s) signing this certification.
11) As of the date of this report, Mitchell B. Todd, MAI and Michael A. Keane, MAI have
completed the continuing education program for Designated Members of The Appraisal
Institute.
12) The undersigned's 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.
TODD PROPERTY ADVISORS
REAL PROPERTY ANALYSTS, INC.
24.0804 102
Appraisal Institute General Demonstration of Knowledge - Capstone Program
Admissions Department
March 14, 2018
Page Two
Based on the data rendered via a physical inspection of the subject, as well as other pertinent
information, it is my opinion that the market value of the fee simple interest in the subject
property, as of March 6, 2018, is:
“As Is" Market Value:
ONE MILLION SEVEN HUNDRED FORTY THOUSAND DOLLARS
($1,740,000)
Such opinion is subject to the general assumptions and limiting conditions found on page
?????. This letter must remain attached to the report, which contains ????? pages, in order for
the value opinion set forth to be considered valid. Particulars and supporting data are provided
in the accompanying report.
Respectfully submitted,
Michael A. Keane
State Certification #TX-1380384-G
michaelakeane@me.com
13) The appraisal report was not based on a requested minimum valuation, a specific valuation,
or the approval of a loan.
14) Neither the undersigned nor any associate of the appraisers considered race, color, religion,
sex, national origin, handicap, or familial status in determining the value of the subject
property.
15) Todd Property Advisors, Mitchell B. Todd, MAI, Michael A. Keane, MAI, and Jonathan D.
Martin have rendered no services as an appraiser or in any other capacity regarding this
property within the three-year period immediately preceding acceptance of this assignment.
16) Jonathan D. Martin made a personal inspection of the property that is the subject of this
report on August 23, 2024, and other dates.
17) In our opinion, and after careful consideration of the various factors entering into this
appraisal, the “as is" market value of the fee simple estate of the subject property, land only,
as of the effective date of appraisal, August 23, 2024, was:
“As Is" Market Value:
SIX HUNDRED THOUSAND DOLLARS
($600,000)
Respectfully submitted,
Mitchell B. Todd, MAI Michael A. Keane, MAI
President Senior Vice President
State Certification #TX-1323514-G State Certification #TX-1380384-G
mitchell@toddpa.com michael@toddpa.com
Jonathan D. Martin
Appraisal Associate
State Certification #TX-1381200-G
jonathan@toddpa.com
TODD PROPERTY ADVISORS
REAL PROPERTY ANALYSTS, INC.
24.0804 103
ASSUMPTIONS AND LIMITING CONDITIONS
1) No responsibility is assumed for matters legal in character or nature, nor matters of survey, nor of any
architectural, structural, mechanical or engineering nature. No opinion is rendered as to the title of the subject
property, which is presumed to be good and marketable. The legal description is assumed to be correct as used
in this report.
2) The property is appraised as though free and clear of any or all liens or encumbrances unless stated.
3) The property is assumed to be under responsible ownership and competent management.
4) The appraisers have not independently verified all of the information furnished or assumptions made with
respect to the appraisal unless otherwise indicated and therefore is not responsible for their content or their
effect on the market value of the property. The information furnished by others is believed to be reliable.
However, no warranty is given for its accuracy.
5) All engineering is assumed to be correct. The maps or other illustrative materials included in this report are
intended only to depict spatial relationships. They are not measured surveys nor measured maps, and the
appraiser is not responsible for cartographic or surveying errors. Dimensions and areas of the subject property
and of the comparables were obtained by various means and are not guaranteed to be exact.
6) The appraisal is based on there being no hidden, unapparent, or apparent conditions of the property site,
subsoil, or structures or toxic materials which would render it more or less valuable. No responsibility is
assumed for any such conditions or for any expertise or engineering to discover them.
7) The appraisal is based on the premise that there is full compliance with all applicable federal, state and local
environmental regulations and laws unless otherwise stated in this report.
8) This appraisal is based on the assumption that all applicable zoning, building, and use restrictions for all types
have been complied with, unless a nonconformity has been stated, defined, and considered in report.
9) The assumption has been made that all required licenses, consents, permits or other legislative or
administrative authority, local, state, federal and/or private entity or organization have been or can be obtained
or renewed for any use considered in the value estimate.
10) Unless otherwise stated in this report, the existence of hazardous substances, including without limitation
asbestos, polychlorinated biphenyls, petroleum leakage, or agricultural chemicals, which may or may not be
present on the property, or other environmental conditions, were not called to the attention of nor did the
appraiser become aware of such during the appraiser's inspection. The appraisers have no knowledge of the
existence of such materials on or in the property unless otherwise stated. The appraisers, however, are not
qualified to test such substances or conditions. If the presence of such substances, such as asbestos, urea
formaldehyde, foam insulation, or other hazardous substances or environmental conditions, may affect the
value of the property, the value estimated is predicated on the assumption that there is not such condition on
or in the property or in such proximity thereto that it would cause a loss in value. No responsibility is assumed
for any such conditions, nor for any expertise or engineering knowledge required to discover them. The client
is urged to retain an expert in the field of environmental impacts upon real estate if so desired.
11) This appraisal is based on the assumption that the use of the land and improvements is within the boundaries
of the subject property and there is no trespass or encroachment unless otherwise noted in the report.
12) The distribution of the total valuation in this report between land and improvements applies only under the
existing program of utilization. The separate valuations for land and building must not be used in conjunction
with any other appraisal and are invalid if so used.
13) Possession of this report or any copy thereof does not carry with it the right of publication, nor may it be used
for other than its intended use. The Bylaws and Regulations of the Appraisal Institute require each Member and
Candidate to control the use and distribution of each appraisal report signed by such Member or Candidate;
this appraisal report shall not be given to third parties without the prior written consent of the signatory of this
appraisal report. Neither all nor any part of this appraisal report shall be disseminated to the general public by
use of advertising media, public relations, news, sales or other media for public communication without the
prior written consent of the appraisers.
TODD PROPERTY ADVISORS
REAL PROPERTY ANALYSTS, INC.
24.0804 104
14) The appraisers are not obligated to provide any other services, including but not limited to, testimony in court
or before any other body charged with interpretation of enforcement of the appraisal.
15) No portion of the appraisal may be reproduced in whole or in part without the prior written consent of the
appraisers. The validity of the appraisal is expressly conditioned upon consideration of its entirety.
16) Due to the nature of real estate valuation and the complexities of external and internal factors which dictate the
market value of any real estate, and the rapid changes and fluctuations with respect to the valuation of real
estate, the opinion of the appraisers set forth in the appraisal concerning the market value of the property is
reliable as of the effective date and should not be considered as reliable at any time thereafter.
17) The appraisers make no guarantee or warranty, whether implied or expressed, concerning the market value
set forth in the appraisal. The appraisal merely sets forth the appraisers opinion of such market value based
upon information obtained by the appraisers and assumptions made by the appraisers with respect to the
property.
18) The appraisers assume no responsibility for any costs or consequences arising due to the need, or the lack of
need for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to
determine the actual need for flood hazard insurance.
19) Subsurface Rights (minerals and oil) were not considered in this appraisal unless otherwise specifically stated.
20) The State of Texas does not have full disclosure laws regarding real estate transactions. Therefore, the
appraisers necessarily confirmed all sales and rental comparables with brokers, property managers, mortgage
brokers, grantors, grantees and other parties familiar with the transaction. The appraiser’s data is limited by the
accuracy of the information supplied by the aforementioned individuals. Whenever possible, the information
was verified by county records.
21) The value conclusion within this report is contingent upon the site being in full compliance with city codes, and
that no contamination has occurred at the site. A Phase I Environmental Study was not provided, and the
appraisers accept no responsibility as to the current status of property with respect to environmental
contaminants. It is recommended that if a Phase I study has not been performed, that an expert in this field be
engaged to identify any hazardous materials and substances existing on the property.
22) It is assumed there is full compliance with all requirements of Title III, of the Americans with Disabilities Act
(ADA) which became effective January 26, 1992 unless non-compliance is stated, defined, and considered in
the appraisal report. No responsibility is assumed by the appraisers for any such conditions, or for any expertise
or architectural/design knowledge and cost required to identify such non-compliance.
23) As used in professional appraisal practice the term “inspection” is “a personal observation of the exterior and/or
interior of the real property that is the subject of an assignment. The purpose of an appraiser’s inspection is to
identify the property characteristics that are relevant to the assignment, such as amenities, general physical
condition, and functional utility.” Inspection is considered a term of art in the appraisal profession and does not
have the same meaning as it might have in other professions such as engineering or architecture or in other
design or construction related professions. Additionally, it does not infer any obligation to investigate.
SECTION VIII – ADDENDUM
QUALIFICATIONS OF MITCHELL B. TODD, MAI
─────────────────── • ───────────────────
EXPERIENCE
1/94 to Present President – Todd Property Advisors, Real Property Analysts, Inc.; Plano, Texas
7/92 to 1/94 Vice President - Beer-Wells-Vaughan, Commercial Property Analysts; Dallas, Texas
6/86 to 7/92 Vice President - Noyd & O'Connell, Inc.; Real Estate Appraisers & Consultants; Dallas,
Texas (2/90-7/92); Houston, Texas (6/86-1/90)
During Mr. Todd's tenure as a real estate appraiser, he has prepared numerous valuations on a variety of high profile and
complex income producing real estate developments. Additionally, Mr. Todd has been involved in the valuation of
numerous single family and multi-family residential properties during his career. These assignments required analytical,
communication, and problem-solving skills which Mr. Todd has continually enhanced since his inception into the
profession. During the last several years, as the Dallas/Fort Worth residential market has expanded and mortgage
interest rates have been at attractive levels, Mr. Todd has gained significant experience in the appraisal of single family
residential properties for the purpose of obtaining mortgage financing.
Some of the more complex assignments in which Mr. Todd has completed appraisals involve numerous parcels
assembled by the City of Dallas for the American Airlines Center and the new performing arts center in the Arts District;
Reunion Arena and adjacent parking facilities, The Grand Hotel and the Mercantile Complex in the Dallas CBD; the
proposed Bank One Building in the Fort Worth CBD; the Hughes Aircraft Facility in Las Cruces, New Mexico; the
Stephens Graphics Manufacturing Facility in Dallas, Texas; the Radisson Inn Tulsa Airport in Tulsa, Oklahoma, the
Trophy Club Development (all remaining lots, acreage, and disputed acreage) of Denton County, Texas; the Eldorado
Subdivision (all remaining lots and acreage) in McKinney, Texas; the Stonebriar Community Church in Frisco, Texas; the
Trinity Terrace Retirement Center in Fort Worth, Texas; the San Antonio Savings Association Headquarters Building in
San Antonio, Texas and numerous portfolios of credit tenant retail projects, office buildings, charter schools, full service
car washes and extended stay lodging facilities across Texas and the United States.
PROFESSIONAL LICENSE AND AFFILIATIONS
Designated member of The Appraisal Institute - MAI #9379.
State Certified General Real Estate Appraiser
Texas Certificate # TX-1323514-G
Oklahoma Certificate # 1287CGA
Arkansas Certificate # CG3379
Registered Property Tax Consultant, State of Texas (Registration #00002555).
Licensed Broker by the Texas Real Estate Commission (License #0364803)
Member - Society of Texas A&M Real Estate Professionals
EDUCATION
Master's Degree - Land Economics and Real Estate, Texas A&M University, 1986.
Bachelor of Science Degree - Agricultural Economics, Texas A&M University, 1984.
The Land Economics and Real Estate curriculum at Texas A&M University is one of only three degree programs in the
United States which have been sanctioned by The Appraisal Institute for post-graduate studies in commercial real estate
appraisal. During his pursuit of the Master's degree, Mr. Todd served as a graduate teaching assistant for several
undergraduate courses, including real estate appraisal curriculum. Mr. Todd received the Master's degree in May 1986.
Prior to his post-graduate studies, Mr. Todd received a Bachelor of Science Degree in December 1984, graduating with
Magna Cum Laude honors.
The Appraisal Institute courses completed by Mr. Todd include: Standards of Professional Appraisal Practice, Principles
of Appraisal, Basic Valuation, Capitalization Theory - Part A, Capitalization Theory - Part B, Case Studies in Real Estate
Valuation, Report Writing and Valuation Analysis, and received a passing grade on both the Comprehensive Examination
and the Demonstration Report. Mr. Todd was awarded the designation of MAI in May 1992. The Appraisal Institute
conducts a program of continuing professional education for its designated members. MAI and SRA members who meet
the minimum standards of the program are awarded periodic educational certification. Mr. Todd is currently certified
under this program. Mr. Todd serves on the Region 8 Ethics and Counseling Regional Panel of the Appraisal Institute.
Other college level real estate courses and seminars completed by Mr. Todd include: Real Estate Development Analysis,
Real Property Valuation, Building Construction Practices, Rural Real Estate Appraisal, Understanding Limited Appraisals
and Reporting Options, ASB Informational Meeting, and Texas Property Tax Law.
QUALIFICATIONS OF MICHAEL A. KEANE, MAI
─────────────────── • ───────────────────
EXPERIENCE
8/15 – Present Senior Vice President – Todd Property Advisors, Real Property Analysts, Inc.;
Plano, Texas
10/12 – 8/15 Senior Appraiser – Todd Property Advisors, Real Property Analysts, Inc.; Plano,
Texas
10/09 – 10/12 Appraisal Associate – Beer-Wells-Todd, Real Property Analysts, Inc.; Plano,
Texas
During Michael's tenure as a real estate appraiser and appraisal research assistant, he has assisted in
the preparation and market research for numerous valuations on a variety of commercial real estate
developments. These properties consisted of various single and multiple tenant industrial, general office,
medical office, and retail facilities as well as residential subdivision developments, multifamily
developments, and user specific and special purpose properties such as automotive repair/service, full
and self-serve car wash facilities, airplane hangars, fixed base operations, flight schools, marinas, ice
skating rinks, and bill board properties. Michael has also appraised properties for eminent domain/partial
taking purposes.
Michael’s responsibilities involve performing property inspections as well as analyzing market trends,
collecting and analyzing market data, analyzing subject property income and expense information,
estimating reproduction costs and depreciation as well as utilizing all aforementioned data to perform real
property appraisals.
PROFESSIONAL LICENSE AND AFFILIATIONS
Designated Member of The Appraisal Institute - MAI
State Certified General Real Estate Appraiser
Texas Certificate # TX-1380384-G
EDUCATION
Master’s Degree - Land Economics and Real Estate - Texas A&M University, 2008
Bachelor of Science Degree – Sport Management - Texas A&M University, 2007.
Minor in Business Administration
The Land Economics and Real Estate curriculum at Texas A&M University is one of only three degree
programs in the United States which have been sanctioned by The Appraisal Institute for post-graduate
studies in commercial real estate appraisal. During his pursuit of the Master's degree, Michael
completed various real estate and financial oriented courses including Real Property Valuation I & II,
Real Property Finance, Real Estate Development, Financing Real Estate Investments, Money and
Capital Markets, and Commercial Real Estate Law. Michael received the Master's degree in December
2008. Prior to his post-graduate studies, Michael received a Bachelor of Science Degree in August
2007.
Texas Appraiser Licensing and Certification Board certified courses completed by Michael include:
Appraisal Principles, Appraisal Procedures, Sales Comparison Approach, Income Approach Parts 1 & 2,
Finance Statistics and Valuation Modeling, Site Valuation and Cost Approach, Business Practices and
Ethics, and Uniform Standards of Professional Appraisal Practice receiving a passing grade on all course
examinations.
Appraiser: MICHAEL ANDREW KEANE
License #: TX 1380384 G License Expires: 11/30/2024
Chelsea Buchholtz
Commissioner
Certified General
Real Estate Appraiser
Having provided satisfactory evidence of the qualifications required
by the Texas Appraiser Licensing and Certification Act, Occupations
Code, Chapter 1103, authorization is granted to use this title:
Certified General Real Estate Appraiser
For additional information or to file a complaint please contact TALCB
at www.talcb.texas.gov.
MICHAEL ANDREW KEANE712 S WEATHERRED DRRICHARDSON, TX 75080
QUALIFICATIONS OF JONATHAN D. MARTIN
─────────────────── • ───────────────────
EXPERIENCE
01/20 to Present Associate Appraiser – Todd Property Advisors, Real Property Analysts, Inc.;
Plano, Texas
During Mr. Martin's time as a real estate appraiser, he has prepared valuations on a wide variety of real estate
developments. These assignments include single-tenant and multi-tenant office, retail, industrial, and medical
developments, as well as single-family and multi-family residential valuations. Some of the more complex
appraisals Mr. Martin has performed have involved high-rise office buildings in Downtown Dallas, anchored
strip shopping centers, and multi-property portfolios including mixed property types.
Additionally, Mr. Martin has performed appraisal services for more than ten city municipalities, in addition to
imminent domain valuation for the Texas Department of Transportation.
PROFESSIONAL LICENSE AND AFFILIATIONS
Certified General Appraiser
Texas Certificate #TX-1381200-G
EDUCATION
Bachelor of Business Administration – Finance, Texas A&M University, College Station, Texas; 2019
The Bachelor of Business Administration in Finance curriculum at Texas A&M University includes vital
material for the appraisal field. Additionally, Mr. Martin completed all Real Estate specific courses that are
offered through the Mays Business School Finance Department, including Real Estate Decision-Making and
Real Estate Finance. Furthermore, Mr. Martin has completed all qualifying educational requirements to
achieve Certified General Appraiser licensure in the State of Texas.