Summary Appraisal of French Valley Aviation, Inc
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SUMMARY APPRAISAL OF FRENCH VALLEY AVIATION, INC. FIXED BASE OPERATION 37552 WINCHESTER ROAD, BUILDING #4 RIVERSIDE COUNTY, CA 92563 Prepared For Ms. Karen Vincent County of Riverside Economic Development Agency By Donald Falk CA Certificate # AG017342 May 1, 2011 June 3, 2011 Ms. Karen Vincent County of Riverside Economic Development Agency P.O. Box 1180 Riverside, CA 92502 Dear Ms. Vincent: As you requested, I have inspected the French Valley Aviation fixed base aircraft maintenance and storage hangar, which is located on the west side of the French Valley Airport taxiway at 37552 Winchester Road (Building 4) in Riverside County, California 92563. In addition, I have prepared a summary appraisal of the subject property in an as is status. The purpose of this appraisal is to estimate the market value of the subject property's leased fee estate as of May 1, 2011, subject the limiting conditions and assumptions outlined in this appraisal report. The property is legally described at Exhibit A in the report. Pertinent information utilized in arriving at a value conclusion is contained in my appraisal files and the body of this report, which contains 59 pages and three exhibits. This summary appraisal is prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the Appraisal Foundation, Office of the Comptroller of the Currency (OCC), all State Fish and Game, Wildlife Conservation Board, Federal Fish and Wildlife Service guidelines, including any other applicable County, State, and/or Federal regulations and guidelines, and/or any other applicable statutes for appraisal reports. Based upon my analysis of the accumulated data, I have concluded the following estimate of market value of the subject property’s leased fee estate as of May 1, 2011: ONE MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS ($1,250,000) Respectfully submitted, Donald Falk CA Certificate # AG017342 TABLE OF CONTENTS Page Summary of Salient Facts and Conclusions. i Photographs of Subject Property. ii Scope of Work. 1 Intended Use of Appraisal. 2 Ownership and Legal Description.. 2 Purpose and Date of Appraisal.. 2 Property Rights Appraised. 2 Regional Description.. 3 Regional Map. 4 Area Description. 6 Area Map. 7 Site Description. 9 Description of Improvements. 10 History of Subject Property.. 13 Zoning.. 13 Highest and Best Use.. 15 Estimate of Normal Marketing Period.. 17 Approaches to Value. 17 Cost Approach. 18 Income Approach. 23 Sales Comparison Approach. 38 Improved Sales Map.. 50 Reconciliation of Value Estimates. 55 Certificate of Appraisal. 56 Limiting Conditions and Assumptions.. 57 Qualifications of Appraiser. 58 EXHIBITS A) Legal Description B) French Valley Airport Plan, Site Plan & Building Floor Plan C) Subject Lease (pages 1-3) i SUMMARY OF SALIENT FACTS AND CONCLUSIONS Name: French Valley Aviation fixed based operation Location: 37552 Winchester Road (Building 4), Riverside County, California 92563 Interests appraised: Leased fee estate Ownership: Redevelopment Agency for the County of Riverside Lessee: French Valley Aviation, Inc. Type of property: Fixed base operation consisting of a pre- engineered metal aircraft maintenance and stor- age hangar with finished office space and flight school store, and aircraft ramp area with 20 small aircraft tie-down spaces; jet fuel dispensing equipment is not included in the appraisal Date of valuation: May 1, 2011 Land area: 2.94 acres Building area: Hangar 13,888 square feet Store 1,230 square feet Office space 1,869 square feet Total building area 16,987 square feet Normal marketing period Six to twelve months Highest and best use: As though vacant hold for eventual devel- opment of aviation relat- ed uses As improved Existing FBO Value Estimates Cost approach: $1,380,000 Income approach: $1,220,000 Sales comparison approach $1,270,000 Final value estimate: $1,250,000 ii Looking northeasterly at subject property from airport taxiway Looking southeasterly at subject building from Sky Canyon Drive iii Looking northwesterly at subject building from airport taxiway Looking southwesterly at subject building from Sky Canyon Drive iv View of ramp area and aircraft tie-downs west of building View of west ramp area and aircraft tie-downs south of airport taxiway v Interior view of aircraft maintenance hangar Interior view of hangar and office mezzanine vi Interior view of flight center office Interior view of flight center store vii Interior view of flight school training area Interior view of employee work room viii Looking southerly along taxiway with subject hangar in right of photo Looking southerly along Sky Canyon Drive with subject property in left of photo ix SCOPE OF WORK This section of the appraisal applies to the identification and performance of the ap- propriate level of research and analysis in an assignment and involves the following three steps - 1) identify the problem to be solved, 2) determine and perform the work necessary to develop a credible assignment result, and 3) disclose the scope of work in the report. The work in this assignment involves the review of existing information as well as data gathered from field research leading to a conclusion of the market value of the fixed base aircraft maintenance and storage hangar, which is located on the west side of the French Valley Airport runway at 37552 Winchester Road (Building 4) in Riverside County, Cali- fornia 92563. In this summary appraisal the subject property’s leased fee estate is valued in an as is status, subject to the limiting conditions and assumptions contained in the report. By definition, as is status reflects the improvements’ physical condition and any legal, environmental, and/or financial factors or encumbrances known to impact the property at the effective date of appraisal. It is my intent that this appraisal assignment be performed in such a manner that the results of the analyzes, opinions, and conclusions be that of a disinterested third party. It is further intended that all appropriate data deemed pertinent to the solution of the appraisal problem be collected, confirmed, and reported in conformity with the Uniform Standards of Pro- fessional Appraisal Practice (USPAP) promulgated by the Appraisal Standards Board of the Appraisal Foundation, the appraisal standards required by Title XI of FIRREA, the Office of the Comptroller of the Currency (OCC), all State Fish and Game, Wildlife Conservation Board, Federal Fish and Wildlife Service guidelines, including any other applicable County, State, and/or Federal regulations and guidelines, and/or any other applicable statutes for appraisal reports. In completing this assignment I first conducted an extensive review of the county’s general aviation airport market, and I analyzed supply and demand characteristics for the type of property that would be considered competitive with the property being appraised. After assemblage and analysis of this information, I conducted a detailed search throughout the French Valley Airport market area, as well as other general aviation airports in Riverside, Los Angeles, and San Diego Counties, for various types of market data, including improved aircraft hangar and maintenance properties and aircraft hangar rental rates. This in- formation was then confirmed with principals, their representatives, and/or their agents. Sources of data include the Riverside, Los Angeles, and San Diego County Recorder’s official records, Riverside County Economic Development Agency, County of San Diego General Services Department, market data services, published reports, my appraisal files, and personal contacts. In this report my valuation approach consists of the three traditional approaches to value leading to a conclusion of market value of the subject property’s leased fee estate. These approaches are the cost, income, and sales comparison approaches. Each approach, which is discussed and developed in detail in later sections of this report, provides a particular emphasis which aids in arriving at an opinion of value for the property. 1 The report scope also includes a discussion and analysis of the highest and best use of the property as though vacant and as improved. The opinions set forth in this appraisal are subject to the Limiting Conditions and Assumptions contained in the narrative report. INTENDED USE OF APPRAISAL The appraisal is prepared for the sole purpose of assisting the County of Riverside Economic Development Agency in establishing a fair market rental rate for the property that is the subject of this appraisal. OWNERSHIP AND LEGAL DESCRIPTION The subject parcel and improvements, which are under the ownership of County of Riverside, are legally described at Exhibit A. PURPOSE AND DATE OF APPRAISAL The purpose of this valuation is to estimate the as is market value of the subject property’s leased fee estate as of May 1, 2011, subject to the limiting conditions and assumptions included in the report The term market value is defined by The Office of The Comptroller (12 CFR, Page 34, Sub-part C, Section 34.42) as follows: 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, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: - buyer and seller are typically motivated; - both parties are well informed or well advised and each is acting in what he considers his best interest; - a reasonable time is allowed for exposure in the open market; - payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and - the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. PROPERTY RIGHTS APPRAISED The subject building, site improvements, and underlying land, which are leased to French Valley Aviation, Inc., represent a leased fee estate.