Fort Walton Beach Council agenda — 03-23-2010 Special-Soundside Develp. Project — reading text

members of his or her family. A family household may contain people not related to the householder, but those people are not included as part of the householder's family in census tabulations. Thus, the number of family households is equal to the number of families, but family households may include more members than do families. A household can contain only one family for purposes of census tabulations. Not all households contain families since a household may comprise a group of unrelated people or one person living alone. Housing unit A house, an apartment, a mobile home or trailer, a group of rooms, or a single room occupied as separate living quarters, or if vacant, intended for occupancy as separate living quarters. Separate living quarters are those in which the occupants live separately from any other individuals in the building and which have direct access from outside the building or through a common hall. For vacant units, the criteria of separateness and direct access are applied to the intended occupants whenever possible. Value Tech Realty Services, Inc. www.golovalue.com Page 7 90-  Sound Side Apartments Definitions Accrued Depreciation The difference between the reproduction or replacement cost of the improvements on the effective date of the appraisal and the market value of the improvements on the sane date. ( Dictionary) Appraisal The act or process of developing an opinion of value. ( USPAP) Business Value A value enhancement that results from items of intangible personal property such as marketing and management skill, an assembled work force, working capital, trade names, franchises, patents, trademarks, contracts, leases, and operating agreements ( Dictionary). Deferred Maintenance Curable, physical deterioration that should be corrected immediately, although work has not commenced; denotes the need for immediate expenditures, but does not necessarily suggest inadequate maintenance in the past. ( Dictionary) Direct Capitalization A method used to convert an estimate of a single year' s income expectancy into an indication of value in one direct step, either by dividing the income estimate by an appropriate rate or by multiplying the income estimate by an appropriate factor. Effective Date of the Appraisal The date at which the value opinion is an appraisal applies, which may or may not be the date of inspection; the date of the market conditions that provide the context for the value opinion. Current appraisals occur when the effective date of the appraisal is contemporaneous with the date of the report. Prospective value opinions ( effective date of the appraisal subsequent to the date of the report) are intended to reflect the current expectations and perceptions along with available factual data. Retrospective value opinions are likely to apply as of a specific historic date; the opinions are intended to reflect the expectations and perceptions of market participants at the specified date, along with available factual data. Data subsequent to the effective date may be considered in estimating a retrospective value as a confirmation of trends. ( Dictionary and USPAP) Entrepreneurial Profit Entrepreneurial profit is a " market- derived figure that represents the amount an entrepreneur expects to receive for his or her contribution to a project "; may be measured by the difference between the total cost of a property ( cost of development) and its market value ( property value after completion), which represents the entrepreneur's compensation for the risk and expertise associated with development. The term " entrepreneurial incentive" has the same definition as profit, but the perspective of the use of the word " incentive" is forward- looking ( expected reward), whereas the use of the word " profit" indicates a retrospective perspective of a quantifiable amount earned. Unless otherwise noted, as used in this report, the terms are synonymous. ( Definition and Twelfth Edition) Page 8 Value Tech Realty Services, Inc. www.gotovalue.com 91_  Sound Side Apartments Definitions Exposure Time Exposure tirne is the estimated length of time 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. Exposure time differs from the marketing period in that exposure time is assumed to precede the effective date of the appraisal. ( USPAP and Dictionary) Fee Simple Estate Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat. ( Dictionary) Going -concern Value The value created by a proven property operation; considered as a separate entity to be valued with a specific business establishment. ( Dictionary) Gross Building Area ( GBA) The total floor area of a. building, including below -grade space but excluding unenclosed areas; measured from the exterior of the walls. ( Dictionary) Highest and Best Use 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. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum profitability. (Dictionary) Insurable Value The Appraisal Institute defines insurable value as the value based on the replacement and /or reproduction cost of physical items that are subject to loss from hazards. It is that portion of an asset or asset group that is acknowledged or recognized under the provisions of an applicable loss insurance policy. Marshall & Swift defines insurable value as the " replacement or reproduction cost less deterioration and non -insurable items." ( MVS and Dictionary) Investment Value The specific value of an investment to a particular investor or class of investors based on individual investment requirements; distinguished from market value, which is impersonal and detached. Dictionary) Leased Fee Estate An ownership interest held by a landlord with the rights of use and occupancy conveyed by lease to others. The rights of the lessor ( the leased fee owner) and the leased fee are specified by contract terms contained within the lease. ( Dictionary) Value Tech Realty Services, Inc. www.gotovalue. com Page 9 92-  Sound Side Apartments Definitions Leasehold Estate The interest held by the lessee ( the tenant or renter) through a lease conveying the rights of use and occupancy for a stated term under certain conditions. ( Dictionary) Market Value The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition are the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: buyer and seller are typically motivated; both parties are well informed or well advised, and acting in what they consider their best interests; 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. ( USPAP, according to the Federal Register, CFR 34.43( F)) Marketing Period A reasonable marketing period is the period of time it might take to sell a property interest in real estate at or near the concluded market value during the period immediately following the effective date of the appraisal. A marketing period is a function of price, time, use, and anticipated market conditions. Replacement Cost The estimated cost to construct, at current prices as of the effective date of the Appraisal, a building with utility equivalent to the building being appraised, using modern materials and current standards, design and layout. ( Dictionary and USPAP) Reproduction Cost The estimated cost to construct, at current prices as of the effective date of the Appraisal, an exact duplicate or replica of the building being appraised, using the same materials, construction standards, design, layout, and quality of workmanship and embodying all the deficiencies, superadequacies, and obsolescence of the subject building. ( Dictionary) Use Value The value a specific property has for a specific use. ( Dictionary) Value Tech Realty Services, Inc. www.gotovalue.com Page 10 93-  Sound Side Apartments Background Information Background Information Identification of the Subject The subject is a proposed, 200 -unit affordable apartment community to be located at 20 Carson Drive, Fort Walton Beach, Okaloosa County, Florida. All 200 -units at the subject property will be rent and/ or income restricted. The community will offer one, two, three, and four bedroom units, in addition to enclosed common areas including a clubhouse /community center with computer room. The entire parcel contains approximately 1150 acres. A legal description for the subject is presented in the Addendum. Intended Use of the Report The purpose of the Limited Appraisal is to provide estimates of revenue, expenses, and net operating income for the subject " As -If-Stabilized." Intended User of the Report This Limited Appraisal is to be used by Berkadia Commercial Mortgage LLC, Fort Walton Beach Housing Authority, and' Housing and Urban Development ( HUD) in processing a loan under the HUD MAP 221 ( d) ( 4) program. Pertinent Dates The Limited Appraisal is dated on the last date market information was secured January 6, 2010. Preparation of the written report was completed on January 8, 2010. Scope of Work, Market Research and Appraisal Procedures Standards Rule 2- 2( a; viii) of the Uniform Standards of Professional Appraisal Practice requires that all appraisals "describe the information analyzed, the appraisal techniques employed, and the reasoning that supports the analyses, opinions, and conclusions." Effective July 1, 2006, the new Scope of Work rule was added that emphasizes that each appraisal " must include the research and analyses that are necessary to develop credible assignment results." Note: This appraisal is prepared to comply with the Pre -Application reporting instructions in the MAP Guide and is subject to Jurisdictional