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

m R t^ Property Laurel Oaks Jackson Square Casa Cordoba city Leesburg Tallahassee Tallahassee State Florida Florida Florida Comparability Similar Superior Similar of Units 144 242 1 168 TrendingTrending AnAn updatingupdating percentagepercentage isis defineddefined asas thethe applicationapplication ofof aa timetime adjustmentadjustment toto comparablescomparables inin orderorder toto bringbring themthem forwardforward toto thethe samesame datedate asas thethe mostmost currentcurrent comparable.comparable. TheThe subjectsubject isis thenthen comparedcompared toto thethe trendedtrended expenses.expenses. OnceOnce thethe subject'subject' ss expenseexpense estimatesestimates havehave beenbeen made,made, thenthen aa finalfinal upwardupward trendtrend isis appliedapplied fromfrom thethe pointpoint inin timetime ofof thethe expenseexpense estimateestimate toto thethe currentcurrent date.date. TheThe trendingtrending datedate isis thethe beginning"beginning" periodperiod ofof thethe financial financial informationinformation utilized.utilized. ForFor example,example, aa financial financial periodperiod fromfrom January January 1 throughthrough DecemberDecember 3131 wouldwould havehave aa" " date"date" ofof January January 1. TheThe subject'subject' ss expensesexpenses areare trendedtrended forwardforward toto JanuaryJanuary 2010.2010. Advertising Advertising AdvertisingAdvertising isis generallygenerally thethe costcost forfor locallocal apartment apartment guides,guides, yellowyellow pages,pages, internetinternet webweb pagespages andand promotionalpromotional efforts.efforts. TheThe comparablescomparables provideprovide thethe following:following: ADVERTISING ADVERTISING COMP.COMP. II Comp.Comp. 22 Comp.Comp. 33 ProjectionProjection TotalTotal AdvertisingAdvertising ExpenseExpense PerPer UnitUnit $ $ 122122 $ $ 214214 $ $ 117117 $ $ 128128 ProjectionProjection $ $ 25,25, 523523 AdvertisingAdvertising expensesexpenses areare projectedprojected forfor thethe subjectsubject withinwithin thethe rangerange ofof thethe comparables.comparables. RelianceReliance waswas onon ComparablesComparables I andand 33 asas wellwell asas thethe budgetbudget whenwhen estimatingestimating thisthis expense.expense. ValueValue TechTech RealtyRealty Services,Services, Inc.Inc. www.www. gotovalue.gotovalue. comcom PagePage 3737 120-120-  Sound Side Apartments Income and Expense Analysis Management Fee The Management Fee was estimated at 4% of Effective Gross Income. The comparables provide the following: MANAGEMENT FEE Comp. 1 Comp. 2 Comp. 3 Projection Total Management Fee Expense Per Unit $ 208 $ 442 $ 407 $ 433 Projection $ 86, 611 The management fee estimate of 4% of effective gross income appears reasonable. The management fee is projected within the range provided by the comparables. General Administrative The general administrative expense includes the costs related to such items as office supplies, telephones, computer equipment and maintenance, travel, training, accounting, and legal. The comparables provide the following: GENERAL ADMINISTRATIVE Comp. 1 Comp. 2 Comp. 3 Projection Total General Administrative Expense Per Unit $ 202 $ 256 $ 356 $ 266 Projection $ 53, 174 General Administrative expenses were projected to be within the range provided by the comparables. Reliance was placed on Comparable 2 due to its similar size relative to the subject. Total Administration The comparables provide the following: TOTAL ADMINISTRATIVE EXPENSES ADVERTISING, MANAGEMENT, AND GENERAL Comp. 1 Comp. 2 Comp. 3 Projection Total Administrative Expense Per Unit $ 533 $ 912 $ 879 $ 827 Projection $ 165,308 The sum of advertising, management, and general administrative expenses were within the range provided by the comparables. Therefore, the projection is reasonable. Utilities This category includes all of the costs related to the property owner' s utilities. Utility costs were examined on an individual basis for heat, water /sewer, electric, gas, and garbage removal. The comparables provide the following: Page 38 Value Tech Realty Services, Inc. www.gotovalue.com 121-  Sound Side Apartments Income and Expense Analysis TOTAL UTILITIES Electricity COMP. 1 Comp. 2 Comp. 3 Projection Total Electricity Expense Per Unit 118 75 267 160 Water /Sewer Comp. 1 Com . 2 Comp. 3 Projection Total Water /Sewer Ex ) ense Per Unit 85 75 99 90 Gas Comp. 1 Comp. 2 Comp. 3 Projection Total Gas Expense Per Unit 0 49 9 0 Trash Removal Comp. 1 Comp. 2 Comp. 3 Projection Total Trash Removal Expense Per Unit 38 16 32 80 Projection 65,935 TheThe subjectsubject propertyproperty willwill bebe aa gardengarden - - stylestyle apartmentapartment community,community, similarsimilar toto thethe comparables.comparables. Electricity Electricity expensesexpenses werewere projected projected toto bebe withinwithin thethe rangerange providedprovided byby thethe comparables.comparables. RelianceReliance waswas placedplaced onon thethe subject'subject' ss budgetbudget whenwhen estimating estimating expensesexpenses forfor thisthis category.category. ComparablesComparables 11 andand 22 provideprovide waterwater / / sewersewer utilitiesutilities inin thethe basebase rents.rents. AsAs such,such, ComparablesComparables 11 andand 22 werewere adjusted adjusted downwarddownward toto reflectreflect thisthis difference.difference. Reliance Reliance waswas placedplaced onon Comparable Comparable 2,2, thethe onlyonly propertyproperty thatthat doesdoes notnot offeroffer waterwater / / sewersewer utilitiesutilities inin thethe basebase rents.rents. InIn addition,addition, thethe projectionprojection coincidescoincides withwith thethe subject'subject' ss budget.budget. SinceSince thethe subjectsubject willwill notnot provideprovide gasgas appliancesappliances oror utilizeutilize gasgas inin operationoperation ofof itsits commoncommon areas,areas, thesethese expensesexpenses werewere notnot estimatedestimated forfor thethe subject.subject. Reliance Reliance waswas placedplaced onon thethe subject'subject' ss budgetbudget whenwhen estimating estimating expensesexpenses forfor trashtrash removal.removal. Nevertheless,Nevertheless, trashtrash removalremoval expensesexpenses werewere projectedprojected toto bebe aboveabove thethe rangerange providedprovided byby thethe comparables.comparables. PayrollPayroll PayrollPayroll expensesexpenses werewere basedbased onon typicaltypical salarysalary levels.levels. TheThe followingfollowing staffingstaffing chartchart waswas utilizedutilized asas thethe basisbasis forfor thethe