Okaloosa County BOCC — April 15, 2014 — Foy Shaw Road Project SJPA_Sig Resolution_Appraisals_Land Purchase Agreement Letter — reading text

Project Crestview, Okaloosa County, FL H&A 140023 DEFINITIONS: Market Value The following market value definition is found in Florida case law, (Florida State Road Department v. Stack, 231 So2d 859 Fla., 1* DCA 1969), and is the acceptable and preferred definition of market value: “Value as used in eminent domain statute, ordinarily means amount which would be paid for property on assessing date to a willing not compelled to sell, by a willing purchaser, not compelled to purchase, taking into consideration all uses to which property is adapted and might reasonably be applied.” 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. Leased Fee Interest” A freehold (ownership interest) where the possessory interest has been granted to another party by creation of a contractual landlord-tenant relationship (i.e., a lease). Leasehold Interest’ The tenant’s possessory interest created by a lease. Condominium* 1. A form of ownership in which each owner possesses the exclusive right to use and occupy an allotted unit plus and an undivided interest in common areas. 2. A multiunit structure, or a unit within such a structure, with a condominium form of ownership. ighest and Best Use’ The reasonably probable and legal use of vacant land or an improved property that 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. Alternatively, the probable use of land or improved property- specific with respect to the user and timing of the use-that is adequately supported and results in the highest present value. ..Of land or a site as though vacant: Among all reasonable, alternative uses, the use that yields the highest present land value, after payments are made for labor, capital, and coordination. The use of property based on the assumption that the parce! of land is vacant or can be made vacant by demolishing any improvements. ...Of property as improved: Marketing Time Exposure Time’ The use that should be made of a property as it exists. An existing improvement should be renovated or retained as is so long as it continues to contribute to the total market value of the property, or until the return from a new improvement would more than offset the cost of demolishing the existing building and constructing 2 new one. An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of appraisal. Marketing time differs from exposure time, which is always presumed to precede the effective data of an appraisal. to sell on the market subsequent to the date of an appraisal. 1. The time a property remains on the market. ! Appraisal Institute, The Dictionary of Real Estate Appraisal, Fifth Edition, 2010, Page 78. 2 Ibid., 3 Ibid., $ Ibid., ? Ibid., 3 Ibid., , Ibid., Page 111. Page 161. Page 59. Page 93. Page 121. Page 73. 3.07 + Acres, - Industrial Land, Foy Shaw Road Project Page 3 Crestview, Okaloosa County, FL H&A 140023 2. The estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consumation of a sale at market value on the effective date of appraisal; a retrospective estimate based on an analysis of past evenis assuming 4 competitive and open market. Appraisal® (noun) the actor process of developing an opinion of value; an opinion of value. (adjective) of or pertaining to appraising and related functions such as appraisal practice or appraisal services. The act or process of developing and communicating an opinion about the quality of another Appraisal Review? | appraiser’s work that was performed as part of an appraisal, appraisal review, or appraisal consulting assignment. Credible” Worthy of belief. (The comment following this definition states: “Credible assignment results require support, by relevant evidence and logic, to the degree necessary for the intended use.) The type and extent of research and analysis in an appraisal or appraisal review assignment. (The preamble to Standard | states: “In developing a real property appraisal, an appraiser must identify the problem to be solved, determine the scope of work necessary to solve the problem, and correctly complete research and analyses necessary to produce a credible appraisal.””) Scope of Work"! For each appraisal, and appraisal review assignment, an appraiser must: Scope of Work Rule” 1. identify the problem to be solved; : 2. determine and perform the scope of work necessary to develop credible assignment results; and 3. disclose the scope of work in the report. Extraordinary ; Assumption” an assumption, directly related to a specific assignment, as of the effective date of the assignment results, which, if found to be false, could alter the appraiser’s opinions or conclusions. Hypothetical Condition" a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. 10 The Appraisal Foundation, Uniform Standards of Professional Appraisal Practice, Washington, D.C., 2014, Page U-1 u Ibid., Page U-1 12 P Ibid., Page U-2 13 . Ibid., Page U-4 = Ibid., Page U-13 5 Ibid., Page U-3 is Ibid., Page U-3 Page 4 3.07 + Acres, - Industrial Land, Foy Shaw Road Project H&A 140023 Crestview, Okaloosa County, FL PREAMBLE TO SCOPE OF WORK The analyses and conclusions recognize the criteria of the ‘market value’ definition. More specifically: ” does not automatically mean the high end of a range in an appreciating market, or low end of an proaches either end of an indicated range, particularly ™ “most probable price lected point value as being the “most probable price” indicated range in a declining market. If the value conclusion ap a wide range, a discussion of reasoning and justification of the se is provided; a “g fair sale” is not defined by any regulatory authority or real estate appraisal text book recognized as authoritative, but may be addressed with objectivity; m “prudently and knowledgeably” are buyer and seller criteria that may be addressed with objectivity; “yndue stimulus” is critical and should be documented as absent in ‘short sales,’ or any other pre-foreclosure or post-foreclosure market data; Any range or point value conclusion is examined by the ‘market value’ definition conditions. The analyses in the present market are especially focused on Buyer and seller are typically motivated; # Both parties are well informed or well advised and each acting in what they consider their best interests; a A reasonable time is allowed for exposure in the open market; 3.07 + Acres, - Industrial Land, Foy Shaw Road Project P. age 5 Crestview, Okaloosa County, FL H&A 140023 THE APPRAISAL PROBLEM The appraisers were engaged to develop the market value of 3.07+ acres of vacant industrial land, and damages to the remainder of the parent tract, if any, “As Vacant” located , Crestview, Okaloosa County, Florida, 32546, as of our fina! date of inspection on February 12, 2014. SCOPE OF THE APPRAISAL The preamble to Standard | states: “In developing a real property appraisal, an appraiser must identify the problem to be solved, determine the scope of work necessary to solve the problem, and correctly complete research and analyses necessary to produce a credible appraisal.” The purpose of the appraisal is clearly stated above. The appraisers chose the type and extent of research and analysis in this assignment employing all necessary approaches and all applicable approaches to develop an opinion of value worthy of belief. Some of the details of the scope of work are further described below. The subject property was inspected, photographed, and analyzed. Our analyses and conclusions treat the parcel being taken as part of the overall parent tract. MLS, LoopNet, public records, zoning and land use regulations and office files were researched and studied. The neighborhood was toured. A highest and best use study was concluded. Neighborhood influences were analyzed and considered. Market forces including the supply of industrial vacant land, anticipated future supply of industrial vacant land, sales listings of industrial vacant land, demand for industrial vacant land and anticipated demand for industrial vacant land. Local Realtors were interviewed concerning the overall dynamics of the Okaloosa County real estate market. Comparable land sales have been researched, verified, and analyzed. Other activities undertaken included examination of commercial! real estate values, and zoning and land use regulations. The appraisers confirmed the data employed in this report and analyzed the results. The land sales comparison analysis is generaliy regarded es the most reliable method of estimating value for vacant land in the local market. The quality and quantity of data is regarded as more than sufficient to derive a reliable range of values. The sales comparison approach was used exclusively in this appraisal as the subject is vacant land and no proposed improvements are associated with it. Commerciat/industrial land is rarely leased in the market therefore a reasonable appraiser would not use the income approach since it may not produce a reliable result. The appraisers are not engineers and did not accomplish a site survey. We did not accomplish an environmental survey. Local and national data sources were reviewed for timely factors, rates, costs, and values as they pertained to the property as of the valuation date. The vaiue conclusions were based on interpretation of the data and market effective to the valuation date. In our professional opinion, the extent of the research and analysis produced value opinions that are both credible and reliable. IDENTIFICATION OF THE APPRAISAL REPORT FORMAT We have provided an Appraisal Report, as defined by the 2014 Edition of USPAP, which contains appropriate discussions of relevant conclusions, data, and analysis. Some supporting documentation is retained in the appraiser's files. Page 6 3.07 + Acres, - Industrial Land, Foy Shaw Road Project H&A 140023 Crestview, Okaloosa County, FL TERMS OF THE FINAL VALUE OPINION The final opinion of the market value of the subject property, ‘As Vacant’, as of February 12, 2014, is expressed in terms of cash or financing terms equivalent to cash. APPRAISER’S LIABILITY LIMITATIONS AND CLIENT AGREEMENTS: The acceptance of the report and its use by the client in any manner whatsoever or for any purpose is acknowledgment by him that this report is a satisfactory professional product, and that he has personally read the report, and specifically agrees that the data herein is accurate to the best of the Appraisers’ ability. As a part of the Appraiser-Client employment agreement, the client agrees to notify the Appraisers of any error, omission, or invalid data herein within 15 days of receipt and return the report along with all copies to the Appraisers for correction prior to any use whatsoever. Under no circumstances shall the company's or appraisers’ liability exceed the fee actually collected for this report, and then only in case of a gross error which would have materially affected the Appraisers’ value opinion as of the date of valuation. Thus, by acceptance of this report, you acknowledge that a value opinion is the product of a professionally trained mind, but nevertheless is an opinion only and not a provable fact. As a personal opinion, valuation may vary between Appraisers based on the same facts. Thus, the