APPRAISAL OF REAL PROPERTY Block 8 Vacant Land Full block bounded by SW Farmington Road on the north; Main and Angel on the west and east, respectively; and, SW First Avenue on the south. Beaverton, Washington County, Oregon 97005 Client Requisition No.: 2013707987898485 PREPARED FOR: Liz Jones City of Beaverton 4755 SW Griffith Drive Beaverton, OR 97005 EFFECTIVE DATE OF THE APPRAISAL: November 5, 2012 REPORT FORMAT: Summary IRR - PORTLAND File Number: 134-2012-0360 Block 8 Full block bounded by SW Farmington Road on the north; Main and Angel on the west and east, respectively; and, SW First Avenue on the south. Beaverton, Oregon December 3, 2012 Liz Jones City of Beaverton 4755 SW Griffith Drive Beaverton, OR 97005 SUBJECT: Market Value Appraisal Block 8 Full block bounded by SW Farmington Road on the north; Main and Angel on the west and east, respectively; and, SW First Avenue on the south. Beaverton, Washington County, Oregon 97005 Client Requisition No.: 2013707987898485 Integra Portland File No. 134-2012-0360 Dear Ms. Jones: Integra Realty Resources – Portland is pleased to submit the accompanying appraisal of the referenced property. The purpose of the appraisal is to develop an opinion of the market value of the fee simple fee and retrospective leased fee and leasehold interests in the property. The client for the assignment is City of Beaverton, and the intended use is for asset valuation purposes. The appraisal is intended to conform with the Uniform Standards of Professional Appraisal Practice (USPAP), the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute, and applicable state appraisal regulations. The appraisal is also prepared in accordance with the appraisal regulations issued in connection with the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). To report the assignments results, we use the summary report option of Standards Rule 2-2 of USPAP. Accordingly, this report contains summary discussions of the data, reasoning, and analyses that are used in the appraisal process whereas supporting documentation is retained in our file. The depth of discussion contained in this report is specific to the needs of the client and the intended use of the appraisal. The subject is a parcel of vacant land containing an area of 0.90 acres or 39,204 square feet. The property is zoned RC-OT, Regional Center-Old Town District, which permits a broad range of commercial and residential uses in the central old town core area of Beaverton.. Liz Jones City of Beaverton December 3, 2012 Page 2 Based on the valuation analysis in the accompanying report, and subject to the definitions, assumptions, and limiting conditions expressed in the report, our opinion of value is as follows: VALUE CONCLUSIONS Appraisal Premise Interest Appraised Date of Value Value Conclusion M arket Value Fee Simple November 5, 2012 $860,000 M arket Value Leased Fee M arch 23, 2012 $11,000 M arket Value Leasehold M arch 23, 2012 $849,000 If you have any questions or comments, please contact the undersigned. Thank you for the opportunity to be of service. Respectfully submitted, INTEGRA REALTY RESOURCES -PORTLAND Donald L. Singer, MAI, CRE, FRICS Certified General Real Estate Appraiser OR Certificate # C000055 Ext 09/30/14 Telephone: 503.478.1005 Email: [email protected] BLOCK 8 TABLE OF CONTENTS TABLE OF CONTENTS SUMMARY OF SALIENT FACTS AND CONCLUSIONS ............................................................. 1 Identification of Subject .............................................................................................. 2 Current Ownership and Sales History......................................................................... 2 Type of Value, Property Rights and Effective Date ................................................... 2 Definition of Market Value ......................................................................................... 2 Definition of Property Rights Appraised .................................................................... 3 Client, Intended User and Intended Use ..................................................................... 3 Applicable Requirements ............................................................................................ 3 Prior Services .............................................................................................................. 4 Scope of Work ............................................................................................................ 4 ECONOMIC ANALYSIS ........................................................................................................... 6 Portland MSA Area Analysis...................................................................................... 6 Office Market Analysis ............................................................................................. 17 Retail Market Analysis ............................................................................................. 24 Multifamily Market Analysis .................................................................................... 33 PROPERTY ANALYSIS .......................................................................................................... 43 Land Description and Analysis ................................................................................. 43 Real Estate Tax Analysis .......................................................................................... 47 Highest and Best Use Analysis ................................................................................. 48 VALUATION ANALYSIS ........................................................................................................ 50 Valuation Methodology ............................................................................................ 50 Sales Comparison Approach ..................................................................................... 51 Reconciliation and Conclusion of Value .................................................................. 58 CERTIFICATION ................................................................................................................... 62 ASSUMPTIONS AND LIMITING CONDITIONS ....................................................................... 64 ADDENDA A. Appraiser Qualifications ©2012 BY INTEGRA REALTY RESOURCES BLOCK 8 SUMMARY OF SALIENT FACTS AND CONCLUSIONS SUMMARY OF SALIENT FACTS AND CONCLUSIONS Property Name Block 8 Address Full block bounded by SW Farmington Road on the north; Main and Angel on the west and east, respectively; and, SW First Avenue on the south. Beaverton, Oregon 97005 Property Type Land Owner of Record City of Beaverton Tax ID R125377, R125386, R125395, R125402, R125411, and R125420 Land Area 0.90 acres; 39,204 SF Zoning Designation RC-OT, Regional Center-Old Town District Highest and Best Use Office, retail, or multifamily residential use, or a combination thereof. Exposure Time; Marketing Period <=12 months; <=12 months Date of the Report January 0, 1900 (To be filled in) Sales Comparison Approach Number of Sales 7 Range of Sale Dates Jul 10 to Oct 12 Range of Prices per SF (Unadjusted) $14.97 - $45.03 VALUE CONCLUSIONS Value Appraisal Premise Interest Appraised Date of Value Conclusion Market Value Fee Simple November 5, 2012 $860,000 Market Value Leased Fee March 23, 2012 $11,000 Market Value Leasehold March 23, 2012 $849,000 The values reported above are subject to the definitions, assumptions, and limiting conditions set forth in the accompanying report of which this summary is a part. No party other than City of Beaverton may use or rely on the information, opinions, and conclusions contained in the report. The summary shown above is for the convenience of City of Beaverton, and therefore it is assumed that the users of the report have read the entire report, including all of the definitions, assumptions, and limiting conditions contained therein. PAGE 1 BLOCK 8 GENERAL INFORMATION IDENTIFICATION OF SUBJECT The subject is a parcel of vacant land containing an area of 0.90 acres or 39,204 square feet. The property is zoned RC-OT, Regional Center-Old Town District, which permits a broad range of commercial and residential uses in the central old town core area of Beaverton.. PROPERTY IDENTIFICATION Property Name Block 8 Address Full block bounded by SW Farmington Road on the north; Main and Angel on the west and east, respectively; and, SW First Avenue on the south. Beaverton, Oregon 97005 Tax ID R125377, R125386, R125395, R125402, R125411, and R125420 Le ga l D e sc ription R C -O T Census Tract Number 311 CURRENT OWNERSHIP AND SALES HISTORY The owner of record is the City of Beaverton . The City acquired the property in various transactions between 1999 and 2004, totaling $806,000, or $22.68 per square foot of site area (39,204 square feet). Since the time of acquisition, the improvements that were on the site (several houses) were removed at an unknown cost. To the best of our knowledge, no other sale or transfer of ownership has occurred within the past three years. TYPE OF VALUE,PROPERTY RIGHTS AND EFFECTIVE DATE The purpose of the appraisal is to develop an opinion of the market value of the fee simple and retrospective leased fee and leasehold interest in the property as of the effective date of the appraisal, November 5, 2012. The date of the report is . The appraisal is valid only as of the stated effective date or dates. DEFINITION OF MARKET VALUE Market value is defined as: “The most