Fort Walton Beach Council agenda — 02-27-2007 workshop agenda — reading text

month, considering the estimated land value, this rent indicates about a 8. 2% rate of return to the land. This rate of return is similar to that found with a lease of an outparcel site adjacent to a shopping center. This 48, 000- square foot site began a lease at $ 3, 500 per month starting September 2005. Considering the retail and service commercial use of the parcel at an estimated land value, the lease indicates a rate of return to the land of about 8. 75%. A third lease involves land located within the Pensacola Regional Airport and used for an airplane hanger. Considering the monthly rent in comparison to the estimated land value, this lease sets an upper li:r; nit rate of return at about 11.8%. These several land leases indicating a range in rates of return from about 8% to 12%. From our experience, this is a typical range for rate of return to land. Based on this data and considering the nature of the subject property, we have given most weight to the 8. 2% to 8. 75% range in estimating that a market rate of return for the subject land would be 8. 5%. An 8. 5% rate of return and estimated value of $4, 200, 000 indicates an annual market rent of $357, 000 for the subject Parcel # 1. ESTIMATED ANNUAL LEASE, PARCEL #1 357, 000  55 PART THREE: SUBJECT PARCEL #2 - DESCRIPTIONS, ANALYSIS, AND VALUATIONS .  56 SUBJECT PARCEL # 2 DESCRIPTION For a better visualization of this narration, please refer to the following pages for exhibits and photographs. PARCEL AREA: 1:17. 07 Acres. SHAPE: Slightly irregular polygon. DIMENSIONS: We were only provided with a statement as to the total size of the subject parcel. No surveyor specific legal description of Parcel # 2 was supplied. The only legal description is of the parent parcels, identified as parcel # 26- 1S- 24- 0000- 0001- 0030 & parcel #26- 1S- 24- 0000- 0001- 0040 by the Okaloosa County Property Appraiser' s office. INGRESSIEGRESS: Adequate access from public road with 824. 3 feet fronting the north side of Lewis Turner Boulevard. TOPOGRAPHY: Gently sloping downward 5 to 10 feet from north- northeast to south- southwest. DRAINAGE: Appears adequate. FLOOD DATA: Not located in a flood hazard area. Designated to be located in Zone X according to Flood Insurance Rate Map 12091C0453H, dated December 6, 2002. SOIL COMPOSITION: According to the United States Department of Agriculture Soil Survey of Okaloosa County issued in June 1995, the soil is described as Lakeland sand, 0 to 5 percent slopes. This is further described as an excessively drained soil, poor for cultivated crop use, but moderate for pasture or pine timber growth. The soil is considered well- suited for building development with the only limitation being the possibility of caving in excavated areas. UTILITIES: Connected to water, sanitary sewerage, electricity and telephone service.  57 SITE IMPROVEMENTS: This parcel is improved with a concrete block workshop/ concession stand/office of approximately 1, 500 square feet, a concrete block restroom building of approximately 400 square feet; three softball fields, a covered concrete shelter of approximately 900 square feet, and four gazebos. As we were asked to appraise the land value only, our appraisal does not include any valuation of the existing improvements. EASEMENTS: No adverse easements noted upon inspection of public documents. ZONING & LAND USE: According to zoning maps, the subject parcel is not zoned. Future Land Use is designated as' . County," but within the Fort Walton Beach city limits. ENCROACHMENTS: None noted. RESTRICTIONS: 50- foot building height Above Ground Level AGL), as well as a requirement that all electromagnetic radiation devices be coordinated with the Eglin Spectrum Management Office. GENERAL DESCRIPTION: This parcel is larger than typical for the neighborhood with an irregular shape not considered. to restrict utility. It has approximately 824 feet fronting along the north side of Lewis Turner Boulevard, offering good ingress/ egress. Topography, . drainage, and soil seem to indicate good physical development potential. The pal1cel is restricted through deed restriction to building improvements of not more than 50 feet in height.  59 SUBJECT PARCEL #2 PHOTOGRAPHS View of Subject Parcel #2 along Lewis Turner Boulevard View of Workshop/ Concession Stand/Office on Parcel #2  60 PHOTOGRAPHS iii''')' I';. fI. View of Bathroom Building and Typical Gazebo on Parcel # 2 View of Typical Ball Field on Parcel #2  61 PHOTOGRAPHS View of Rear, Northern Portion of Subject Parcel #2 View of Lewis Turner Boulevard, Facing West  62 HIGHEST AND BEST USE - SUBJECT PARCEL #2 A brief definition of the term "highest and best use" would be: The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value." 6 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. Also implied is that the determination of highest and best use results from the appraisers judgment and analytical skill, i.e., that the use determined represents an opinion, not a fact. The Highest and Best Use section of this report is the pivotal point in the appraisal process. All previous data is used to test in four criteria, as stated in the definition: ( 1) legally permitted, ( 2) physically possible, ( 3) economically feasible, and, ( 4) maximally productive. The property being appraised includes : 1:17. 07 acres of land area, or approximately 743, 569 square feet. It is not zoned, but has a future land use designated as " county," and is located in an area where the prevalent uses are commercial along the most highly trafficked roadways and residential off of these same major roadways. AS VACANT ANALYSIS - Given the appraisal problem, we consider the land as though it were vacant and available to be developed to its highest and best use. The first criteria of legally permitted allows for a variety of uses. The property is not currently zoned, but has a future land use "Of " county." With this being the case, it is conceivable that any number of uses could be allowed for the land. With no specifically defined zoning guidelines, all legally permitted possibilities are considered possible. The second criteria concerns whether the legal uses are physically possible. In this we can consider all possible uses. The site is generally level, has adequate  63 access to public roads, and its shape and size are not detriments to development. While considered too large of a site for a single retail store of less than 10, 000 square feet, the parcel can physically support a large, multi-unit shopping mall. Likewise, a residential subdivision use is not beyond possibility for the subject parcel.We conclude that the physically possible uses of the parcel are many. The third criteria of economically feasible considers whether the legally permissible and physically possible uses are financially feasible at this location and under current market conditions. In our opinion, many uses are financially feasible for the subject parcel. However, commercial development of the subject parcel as a shopping mall or office/ specialty shop complex, for example, would most probably not prove to be feasible. Large commercial centers require a large population located within a reasonable travel time to be successful. It is our opinion that the immediate subject neighborhood does not have the requisite immediate population to support such a large commercial development. While a few shops may become financially viable, we anticipate that most would struggle to maintain enough customer visits to be profitable. However, a residential use of the subject parcel, especially given the dwindling supply of vacant home site within the subject neighborhood, could be developed in an economically feasible manner. The final criteria of " maximally productive" would tend to indicate a residential use to be the highest and best use of the property. However, as indicated above, particularly with the addition of more residential population to the neighborhood, there is some room for commercial success. Research of the subject neighborhood shows that commercial development exists within strips along the most trafficked. thoroughfares. In fact, along Lewis Turner Boulevard, this commercial strip has a depth of between about 200 to 300 feet either side of the road right-of-way. This is a typical development trend found in other communities within the region, most often encouraged by zoning ,districts. It is our opinion that the subject parcel could support a mixed- use. We envision