APPRAISAL REPORT - legistarweb … · the real estate broker, buyer and/or seller. compliance and competency provision This appraisal has been prepared in compliance with the 2014-2015

APPRAISAL REPORTFish Processing Facility813 SW Bay BoulevardNewport, Oregon 97365

Date of Report: Prepared For:August 31, 2015 Larry Green

Columbia Bank1301 South A Street, Suite 700Tacoma, Washington 98402

Date of Value: Prepared By:June 25, 2015 Kent D. Voronaeff, MAI

Voronaeff & Company, LLCP.O. Box 50567Eugene, Oregon 97405

Voronaeff & Company, LLC, P.O. Box 50567, Eugene, Oregon 97405

August 31, 2015

Larry GreenColumbia Bank1301 South A Street, Suite 700Tacoma, Washington 98402

Re: Fish Processing Facility813 SW Bay BoulevardNewport, Oregon 97365

Dear Mr. Green:

In response to your written request (copy included in the Addenda), I have completed an appraisalon the real property located at 813 SW Bay Boulevard, Newport, Oregon. The subject propertyis a 17,240 square foot, two-story, warehouse building utilized as a fish processing facility. Thestructure contains approximately 2,000 square feet (11.60%) of finished office and restroom space.The building was constructed in 1981. The improvements are partially situated on a 13,068 squarefoot or 0.30 acre commercially zoned parcel, and partially situated on a 9,188 square foot or 0.21acre submerged land parcel that is ground leased.

The purpose of this inspection and subsequent analysis was to estimate the subject property’s feesimple value, on June 25, 2015; and to estimate the value of the subject property’s leasehold estate(with the existing ground lease), on June 25, 2015. The Cost Approach and Sales ComparisonApproach are the valuation approaches utilized in the report. Based upon my investigation andanalysis of market data, and subject to the definitions, certifications, and limiting conditions setforth in the attached report, it is my opinion that the values of the subject property, on June 25,2015, were as follows:

(Fee Simple Value)

ONE MILLION SEVEN HUNDRED FIFTY THOUSAND DOLLARS$1,750,000

(Leasehold Value)

ONE MILLION SIX HUNDRED NINETY FIVE THOUSAND DOLLARS$1,695,000

This letter must remain attached to the report, which contains 67 pages, plus addendaexhibits, in order for the value opinions set forth to be considered valid.

Larry GreenAugust 31, 2015

The attached appraisal report details the basis and reasoning for my value conclusions. Please referto the Summary of Salient Facts and Conclusions on page 5, and the Assumptions and LimitingConditions contained on pages 65 through 67.

It is an extraordinary assumption of this appraisal report that the tenant will exercise the 15year renewal options in the ground lease at least three times, which will results in a remainingground lease term of at least 48 years [3 year initial term + (15 years x 3 renewal options)].It should be noted that if the tenant does not exercise all three of the renewal options, thenthe leasehold value conclusion in this appraisal report would not be considered valid. Itshould be noted that the 48 year remaining ground lease term is for a period longer than theestimated remaining economic life of the building. In addition, it is assumed that (1) the Cityof Newport would facilitate a re-assignment of the existing Division of State Lands groundlease to a new buyer of the subject property, (2) the Division of State Lands ground leasewould be re-assigned to the purchaser of the subject property without significant difficultyor expense and in a timely manner, and (3) that environmental issues will not be encounteredand environmental studies will not be necessary.

The principles of the Federal Home Loan Bank Board Regulation 563.17-1a and Office of ThriftSupervision 12 CFR Part 34 of the Office of the Comptroller of the Currency titled Real EstateAppraisals as revised in the Federal Register Volume 59, Number 108, dated June 7, 1994, havebeen taken into consideration in the completion of this appraisal. The appraisal report is FIRREAcompliant. This report has been made in conformance with the Uniform Standards of ProfessionalAppraisal Practice ("USPAP") adopted by the Appraisal Standards Board of the AppraisalFoundation. This appraisal report has also been prepared in conformance with the InteragencyAppraisal and Evaluation Guidelines, effective December 10, 2010, which provides furtherguidance to regulated financial institutions on prudent appraisal and evaluation policies, proceduresand practices.

I certify that this appraisal has been prepared in accordance with the Code of Professional Ethicsand Standards of Professional Practices set forth by the Appraisal Institute. I certify that I haveno present or contemplated interest in the property and that my fee for generating this appraisalis not based upon reporting any specified value or value range.

Please call at your convenience if any additional data or information is required.

Respectfully submitted,

Kent D. Voronaeff, MAIState Certification No. C000303Expiration Date: April 30, 2016

TABLE OF CONTENTS

COVER PAGELETTER OF TRANSMITTALTABLE OF CONTENTS PAGESUMMARY OF SALIENT FACTSINTRODUCTION

PROPERTY APPRAISED.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7PURPOSE OF THE APPRAISAL.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7INTENDED USE AND USER OF THE REPORT. . . . . . . . . . . . . . . . . . . . . . . . . . 7NATURE OF INTEREST APPRAISED.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7SCOPE OF THE ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7COMPLIANCE AND COMPETENCY PROVISION. . . . . . . . . . . . . . . . . . . . . . . . 8INSPECTION DATA.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8APPRAISAL DEFINITIONS.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9AREA MAP.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13AREA ANALYSIS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

PROPERTY DATALEGAL DESCRIPTION.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19OWNER OF RECORD.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19PERTINENT CONDITIONS OF TITLE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19PROPERTY HISTORY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19PRESENT USE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19TAX AND ASSESSMENT DATA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21ZONING.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21SUBJECT PHOTOGRAPHS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22SITE DESCRIPTION.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31ASSESSOR’S MAP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33IMPROVEMENT DESCRIPTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34FLOOR PLAN. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

ANALYSES AND CONCLUSIONSHIGHEST AND BEST USE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39COST APPROACH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41SALES COMPARISON APPROACH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48INCOME APPROACH.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59CORRELATION AND FINAL VALUE CONCLUSION.. . . . . . . . . . . . . . . . . . . . 60EXPOSURE AND MARKETING TIME. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62CERTIFICATION.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63ASSUMPTIONS AND LIMITING CONDITIONS. . . . . . . . . . . . . . . . . . . . . . . . . 65

ADDENDADSL LEASE MAP/DEPTH CHARTAERIAL PHOTOGRAPHFLOOD MAPZONING ENGAGEMENT LETTERAPPRAISER’S QUALIFICATIONS

SUMMARY OF SALIENT FACTS AND CONCLUSIONS

LOCATION: 813 SW Bay Boulevard, Newport, Oregon 97365

ASSESSOR'S ID: Map 11-11-08-CA, Tax Lots 2100-00, 2100-22, and 2100-23, Lincoln County

OWNER OF RECORD: City of Newport (Tax Lots 2100-00 and 2100-22)Division of State Lands (Tax Lot 2100-23)

ASSESSOR'S VALUE (2014-2015): Real Market Value- Land: $ 545,000

Improvements: 957,160Total: $1,502,160

Assessed Value- Land & Improvements: $1,444,120

Taxes- $25,930.32

ZONING: W-2, Water Related

PARCEL SIZE: 13,068 square feet or 0.30 acres (upland and tideland) +9,188 square feet or +0.21 acre (submerged land)22,256 square feet or 0.51 acres (total)

IMPROVEMENTS: A 17,240 square foot, two-story, warehouse buildingutilized as a fish processing facility. The structure containsapproximately 2,000 square feet (11.60%) of finished officeand restroom space. The building was constructed in 1981.

HIGHEST AND BEST USE: Existing Fish Processing Facility Use

VALUE CONCLUSIONS- Fee Simple Value: $1,750,000 Leasehold Value: $1,695,000

DATE OF VALUE: June 25, 2015

DATE OF REPORT: August 31, 2015

APPRAISER: Kent D. Voronaeff, MAI

Voronaeff & Company, LLC

INTRODUCTION

Introduction

PROPERTY APPRAISED

The subject property is located at 813 SW Bay Boulevard, Newport, Oregon. The subject propertyis a 17,240 square foot, two-story, warehouse building utilized as a fish processing facility. Thestructure contains approximately 2,000 square feet (11.60%) of finished office and restroom space.The structure was built in 1981. The improvements are partially situated on a 13,068 square footor 0.30 acre commercially zoned parcel, and partially situated on a 9,188 square foot or 0.21 acresubmerged land parcel that is ground leased.

PURPOSE OF THE APPRAISAL

The purpose of this appraisal is to estimate the “as-is” market value of the subject property.

INTENDED USE AND USER OF THE REPORT

The intended use of this appraisal is to assist the client, Columbia Bank, in loan underwritingand/or credit decisions. Columbia Bank and/or affiliates are identified as the intended users of thisappraisal report. The use of this appraisal by anyone other than the stated intended users, or forany use other than the stated use, is prohibited.

NATURE OF INTERESTS APPRAISED

The nature of the interests appraised are the fee simple estate and the leasehold estate.

SCOPE OF THE ASSIGNMENT

The scope of the appraisal assignment has been to collect, confirm, analyze, and interpret pertinentmarket data and other market forces so as to arrive at an estimate of the market value of thesubject property in its "as-is" condition. The Cost Approach and Sales Comparison Approach arethe valuation approaches utilized in the report. The appraisal report is transmitted in a mannersimilar to the former USPAP Summary Report. The appraisal assignment has included an investigation of the pertinent data relating to the subjectproperty. This investigation included, but was not limited to, area information, subject propertydata, a personal inspection of the subject property, the assembly of land sales data, constructioncost data, improved sales data, current listings, and other pertinent factors which affect the valueof the subject property either directly or indirectly. The Cost Approach and Sales ComparisonApproach were used to value the subject property. The land sale comparables were verified with

Voronaeff & Company, LLC -7-

Introduction

the real estate broker, buyer and/or seller; and the improved sale comparables were verified withthe real estate broker, buyer and/or seller.

COMPLIANCE AND COMPETENCY PROVISION

This appraisal has been prepared in compliance with the 2014-2015 revision of the UniformStandards of Professional Appraisal Practice (USPAP) as adopted by the Appraisal StandardsBoard of the Appraisal Foundation as of January 1, 2014. Kent D. Voronaeff, MAI, has theknowledge and experience to complete this assignment competently, in compliance with the statedregulations.

INSPECTION DATA

Date: June 25, 2015Owner’s Representative: Ricky Garcia, Bornstein Seafoods, inc.Appraiser: Kent D. Voronaeff, MAI


APPRAISAL DEFINITIONS

Market Value

The most probable price which a property should bring in a competitive and open market underall conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeablyand assuming the price is not affected by undue stimulus. Implicit in this definition is theconsummation of a sale as of a specified date and the passing of title from seller to buyer underconditions whereby:

a. buyer and seller are typically motivated;

b. both parties are well informed or well advised, and acting in what they consider theirbest interests;

c. a reasonable time is allowed for exposure in the open market;

d. payment is made in terms of cash in United States dollars or in terms of financialarrangements comparable thereto; and

e. the price represents the normal consideration for the property sold unaffected by specialor creative financing or sales concessions granted by anyone associated with the sale.1

Highest and Best Use

The reasonably probable and legal use of vacant land or an improved property, that is physicallypossible, appropriately supported, financially feasible, and that results in the highest value. Thefour criteria the highest and best use must meet are legal permissibility, physical possibility,financial feasibility, and maximum productivity.2

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.3

FIRREA1

The Dictionary of Real Estate Appraisal, fifth edition, (Chicago, IL: The Appraisal Institute,2

2010) pg. 93

Ibid, pg. 783


Appraisal Definitions

Leased Fee Interest

A freehold (ownership interest) where the possessory interest has been granted to another partyby creation of a contractual landlord-tenant relationship (i.e., a lease).4

Leasehold Interest

The tenant’s possessory interest created by a lease.5

Income-Producing Property

A type of property created primarily to produce monetary income.6

Neighborhood

A group of complementary land uses; a congruous grouping of inhabitants, buildings, or businessenterprises.7

Economic Feasibility

A condition that exists when a prospective earning power is sufficient to pay a requisite rate ofreturn on the completion cost (including indirect costs), In other words, the estimated value atcompletion equals or exceeds the estimated cost.8

Ibid, pg. 1114

Ibid, pg. 1115

Ibid, pg. 996

Ibid, pg. 1337

Ibid, pg. 648



Functional Utility

The ability of a property or building to be useful and to perform the function for which it isintended according to current market tastes and standards; the efficiency of a building's use interms of architectural style, design and layout, traffic patterns, and the size and type of rooms.9

Depreciation

In appraising, a loss in property value from any cause; the difference between the cost of animprovement on the effective date of the appraisal and the market value of the improvement onthe same date.10

Cash Equivalency

An analytical process in which the sale price of a transaction with nonmarket financing orfinancing with unusual conditions or incentives is converted into a price expressed in terms ofcash.11

Market Rent

The most probable rent that a property should bring in a competitive and open market reflectingall conditions and restrictions of the specified lease agreement, including permitted uses, userestrictions, expense obligations, term, concessions, renewal and purchase options, and tenantimprovements (TIs).12

Effective Rent

The rental rate net of financial concessions such as periods of no rent during the lease term andabove- or below-market tenant improvements (TIs). 13

Ibid, pg. 1229

Ibid, pg. 7910

Ibid, pg. 3011

Ibid, pg. 12112

Ibid, pg. 6513



Direct Capitalization

A method used to convert an estimate of a single year's income expectancy into an indication ofvalue in one direct step, either by dividing the net income estimate by an appropriate capitalizationrate or by multiplying the income estimate by an appropriate factor Direct capitalization employscapitalization rates and multipliers extracted or developed from market data. Only a single year’sincome is used. Yield and value changes are implied but not identified.14

Overall Capitalization Rate

An income rate for a total real property interest that reflects the relationship between a singleyear's net operating income expectancy and total property price or value.15

Ibid, pg. 5814

Ibid, pg. 14115


AREA ANALYSISNewport, Oregon

The City of Newport is the County Seat of Lincoln County and is located on the Oregon coastapproximately 25 miles south of Lincoln City; 50 miles north of the City of Florence; 53 mileswest of the City of Corvallis; and 114 miles southwest of the City of Portland.

The City of Newport was incorporated in 1882, and is situated in the west-central portion ofLincoln County. Newport is located at the junction of Highway 101 (known in Newport as CoastHighway) and Oregon State Highway 20. Highway 101 is the major north/south thoroughfarealong the Pacific Coast, and Highway 20 is the major inland route connecting the City of Newportto the City of Corvallis and the I-5 Freeway. Newport provides support facilities for three primarygroups of people - the local residents, the rural populace in nearby areas of Western LincolnCounty, and the tourist populace drawn to the natural resources and scenic beauty of the OregonCoast.

Lincoln County has historically been dependent upon tourism and the seafood and wood productsindustries for its economic welfare. The years between 2000 and 2010 saw the Newport areagrowing at a slow pace, with the population increasing approximately 5.23% within this timeperiod. The City of Newport’s population as of July 1, 2014, is estimated at 10,095; accordingto population figures published on December 15, 2014, by the Center for Population Research andCensus at Portland State University.

The area's one-time dependence upon seafood and wood products manufacturing has given wayto a more diversified economic base of tourism, retirement and thoroughfare commercial activities. The tourism industry has lead the improvement of the area's economy. Newport is well locatedalong Highway 101 and there is an abundance of easily accessible federally owned land frontingthe Pacific Ocean. One of the key characteristics of the City of Newport is the relatively largeYaquina Bay. Large scale development of a seafood industry began in 1908 when electricitybecame available for refrigeration of seafood products. Jetty construction and dredging,complimented by Newport’s already famous Yaquina Head Lighthouse, made Yaquina Bay anattractive shipping port. The bay front remains an active part of the community and is home toOregon’s largest commercial fishing fleet. The bay front also attracts local residents and touristsfor its restaurants, hotels, motels, galleries and shops.

A direct benefit of the tourist pressure the area receives is the exposure of retirement age peopleto the benefits of life in Newport. Costs of living are relatively low in Newport, and the mildclimate is attractive to this segment of the general populace. The area offers good recreational,medical, and support services for retirees. In 1970, approximately 10.00% of the area's populationwas 65 years of age or older, in 1980 this segment of the populace equaled approximately 14.00%, in 1990 this segment of the populace equaled approximately 17.00%, and in 2000 this segment ofthe populace equaled approximately 18.00%.


Area Analysis

A Mayor-City Council-City Manager form of government governs Newport. The non-partisanmayor has a two-year term who leads a six-member city council elected to four-year overlappingterms. A full-time city manager administers the affairs of the city for the council. City servicesinclude full-time police and fire departments, as well as public water system and sewage treatmentfacilities.

The City of Newport is located in the Lincoln County School District. Newport area schoolsconsist of one high school, one middle school, two elementary schools and several preschool andkindergarten schools. There are also two private schools that operate for kindergarten through highschool. Higher education is available at Oregon Coast Community College in Newport; OregonState University in Corvallis (53 miles); Linn-Benton Community College in Albany (60 miles);Western Oregon University in Monmouth (72 miles); and the University of Oregon in Eugene (98miles).

There are basically three commercial neighborhoods within The City of Newport - The HighwayCommercial District, the Yaquina Bay front, and the Nye Beach coast line. The HighwayCommercial District is located along Highway 101, between the northern and southern city limits. The Yaquina Bay front is a distinct commercial neighborhood located primarily along the northernfringe of Yaquina Bay, but also along the waterfront on the south of the bay. It has been thelocation of much of the tourist oriented commercial development such as restaurants and giftshops, but also larger attractions such as the well-known Oregon Coast Aquarium and OregonState University’s Hatfield Marine Science Center. The Nye Beach area is primarily developedwith hotels, motels, and vacation rental properties; and interspersed with some restaurants andretail shops. Nye Beach and the bay front area are considered the premier retail areas of Newport.Because of this, these areas achieve the highest rents for leasing retail/restaurant space.

Of significant importance to the Newport economy is the relocation of the Pacific fleet of shipsof the National Oceanic and Atmospheric Administration (NOAA) from Seattle to the Yaquina Bayof Newport in summer 2011. Construction was completed in 2011 on the $38 million project thataccommodates the NOAA fleet. NOAA is leasing the site near the Hatfield Marine Science Centerunder a 20-year agreement for $2.4 million per year. Newport won out in the bid over three othersites in Washington: Lake Union (Seattle), Bellingham and Port Angeles; which included someserious political wrangling. The fleet is expected to ultimately bring approximately 175 jobs to thearea and create a positive economic ripple effect in the region.

According to the Economic Development Alliance of Lincoln County, the City of Newport’slargest employers include: Lincoln County, OSU Hatfield Marine Science Center, Pacific Seafood,Walmart, Rogue Ales, City of Newport, Trident Seafood Company, Oregon Coast Aquarium, JCMarket and Mo’s Restaurants.


Area Analysis

In regard to the various land uses within Newport, the industrial makeup in the area consistsmostly of small warehouse and manufacturing facilities. The area has been developed over the last40 years, with some development occurring in the late 1980s through 1990s. There is a moderatevariety of industrial users throughout the area. Residential development occupies the majority of Newport’s land area. Newport has developeda reputation as a good place to retire. Its location along Highway 101, proximity to Corvallis,recreational amenities, shopping, and the presence of a hospital, have appealed to retirees. Themajority of retirees have arrived from southern and central California. Commercial facilitiesconsist of general retail uses, sit-down and fast-food restaurants, a Fred Meyer, a Wal-Mart,banks, small offices, hotels and motels, service stations, storage/light industrial uses, other variousbusinesses and vacant land. Recent development includes a 14,490 square foot Walgreens storebeing constructed at the southeast corner of N. Coast Highway (Highway 101) and Highway 20,which is expected to be completed in 2013. Newport's residential and commercial property valuesincreased from 2004 to 2007, declined during 2008 and 2010, and have been relatively stable in2011-2013.

Immediate Area

The Yaquina Bay front is a distinct commercial neighborhood located primarily along the northernfringe of Yaquina Bay, but also along the waterfront on the south of the bay. It has been thelocation of much of the tourist oriented commercial development such as restaurants and giftshops. The majority of the surrounding properties in close proximity to the subject in the YaquinaBay front district are retail buildings, restaurants and fish processing warehouse buildings.Demand for retail and restaurant space, and fish processing warehouse buildings, in the area isconsidered to be adequate to good. The subject has good exposure to vehicular traffic andpedestrian foot traffic on Bay Boulevard, which is beneficial to retail and restaurant uses; andaccess to Yaquina Bay, which is beneficial to fishing related uses.

Summary and Trends

The City of Newport’s economy has diversified in the past several years and it is expected tocontinue to do so in the future. The area’s favorable social, economic, governmental andenvironmental forces contribute to a high demand for real estate. There is currently a good balancein land uses, an adequate economic base, an adequate supply of housing and labor, and a goodtransportation system. All of these factors make the area attractive for owners and occupants ofcommercial, industrial and residential properties. However, although the national recession is overand we are into a recovery, recent polls reveal that a majority of Americans are still cautious aboutthe economy. Residential and commercial real estate values are expected to remain stable over the


Area Analysis

short term, assuming the economy does not significantly worsen. The long-term outlook is for anincrease in real estate values commensurate with the level of growth in the city.


PROPERTY DATA

Property Data

LEGAL DESCRIPTION

A copy of a legal description of the subject property was not provided by the client. The subjectproperty is identified by the Lincoln County Assessor’s Office as Map 11-11-08-CA, Tax Lots2100-00, 2100-22, and 2100-23, Lincoln County, Oregon. The subject property is identified bythe street address of 813 SW Bay Boulevard, Newport, Oregon.

OWNER OF RECORD

City of Newport (Tax Lots 2100-00 and 2100-22)Division of State Lands (Tax Lot 2100-23)

PERTINENT CONDITIONS OF TITLE

A Preliminary Title Report was not provided by the client. Upon physical inspection of the subjectproperty, there were no apparent encroachments noted. The appraiser assumes that there are noeasements, covenants, restrictions, or conditions of title which would adversely affect the valueof the subject property in comparison to competing properties. However, the appraiser is not anexpert in this field. If additional questions arise regarding easements, covenants, restrictions, orconditions of title, further research by a qualified expert is advised.

PROPERTY HISTORY

There have been no sales of the subject property during the past three years.

PRESENT USE

Subject Improvements

The subject improvements (building and dock) are leased from the City of Newport (landlord) toBornstein Seafoods, Inc. via an assignment and assumption of the lease from Ocean BeautySeafoods (tenant) for a 7-month term. The lease commenced on March 1, 2011 and terminates onDecember 31, 2015. There are approximately 6 months remaining on the lease. The currentcontract rent is $4,794.15 per month or $0.28/sf per month ($4,794.15 ÷ 17,240 sf). The rentis structured on a triple net expense basis; in which the tenant pays for real estate taxes, fireinsurance and utilities. It appears Business that if during the term of the lease the landlord receivesan acceptable offer from a third party to purchase subject property, the landlord must first offerthe subject property to the tenant at the same price.


Property Data

Due to the short remaining term on the lease (approximately 6 months), it is concluded that marketparticipants would not recognize this lease when valuing the subject property.

Subject Site

The subject site consists of a 13,068 square foot or 0.30 acre section which is owned by the Cityof Newport, and a 9,188 square foot or 0.21 acre portion which is submerged land that is ownedby the Division of State Lands (DSL). The 9,188 square foot or 0.21 acre portion is ground leasedfrom the Oregon State Land Board and the Division of State Lands (landlord) to the NewportUrban Renewal Agency, i.e. the City of Newport (tenant). The ground lease is for a 17-year term.The ground lease commenced on November 1, 1998 and terminates on October 31, 2018. Thereare approximately 3 years (i.e. 40 months) remaining on the ground lease. The current ground rentis $4,425.62 per year. The ground rent increases annually in accordance with the provisions ofthe Oregon Administrative Rule in effect at the time. The ground lease is structured on a triple netexpense basis; where the tenant pays for the real estate taxes, fire insurance and utilities. Thetenant shall have the option to renew this lease for an additional period of 15 years after theoriginal term and each renewal term provided that the tenant has submitted a completed renewalapplication form not less than 180 days prior to the expiration of the lease. Upon receipt of theapplication, the lease shall be renewed by the landlord unless: (1) the landlord determines, in itssole discretion, that the tenant has not complied with the terms of this lease, the applicable statutesand Oregon Administrative Rules; (2) the tenant is no longer the preference right holder as definedby applicable state law; or (3) the landlord determines that the renewal of this lease for all orportions of the leasehold would be contrary to local, state, or federal law, or would be inconsistentwith the policies set forth in OAR 141-082-0010.

Thus, as long as the tenant submits a renewal application and complies with the terms of the leaseand the three stated conditions, it appears that the tenant can continue to renew the lease for 15year terms into perpetuity. The appraiser spoke with Chuck Perino of the Division of State Lands,and he also indicated that as long as the tenant submits a renewal application and complies withthe terms of the lease and the three stated conditions, the tenant can continue to renew the leasefor 15 year terms into perpetuity. Therefore, it is an extraordinary assumption of this appraisalreport that the tenant will exercise the 15 year renewal options in the ground lease at least threetimes, which will results in a remaining ground lease term of at least 48 years [3 year initial term+ (15 years x 3 renewal options)]. It should be noted that if the tenant does not exercise all threeof the renewal options, then the leasehold value conclusion in this appraisal report would not beconsidered valid. It should be noted that the 48 year remaining ground lease term is for a periodlonger than the estimated remaining economic life of the building. In addition, it is assumed that(1) the City of Newport would facilitate a re-assignment of the existing Division of State Landsground lease to a new buyer of the subject property, (2) the Division of State Lands ground leasewould be re-assigned to the purchaser of the subject property without significant difficulty or


Property Data

expense and in a timely manner, and (3) that environmental issues will not be encountered andenvironmental studies will not be necessary.

The tenant, Bornstein Seafoods, has only partial usage of the docks because of the deteriorationand lack of maintenance in some areas. Thus, there is some uncertainty and risk in themaintenance of the piers and structures located on the DSL leased land. Per typical DSL leaseagreements, there may be a restriction on use stating that the lessee shall "maintain all buildings,docks, pilings, floats, gangways, similar structures, and other improvements located within theleasehold in a good state of repair". If DSL were to enforce the lease restrictions, the tenant wouldbe responsible to bring the improvements back up to "a good state of repair". It is very difficultto make repairs above the waterway, since all repair work will have to be completed under strictcontrols in order to protect the environmental quality of the waterways.

TAX AND ASSESSMENT DATAJune 25, 2015

Assessor’s Identification: Map 11-11-08-CA, Tax Lots 2100-00, 2100-22, and 2100-23, Lincoln County

Assessor’s Value (2014-2015): Real Market Value- Land: $ 545,000

Improvements: 957,160Total: $1,502,160

Assessed Value- Land & Improvements: $1,444,120

Taxes- $25,930.32

The subject property’s tax rate for the 2014-2015 tax year is 0.01796 or $17.96 per $1,000 ofassessed value. As a result of the passage of Measure 50 in 1997, the subject property’s assessedvalue can only increase a maximum of 3.00% annually.

ZONING

The subject property is zoned W-2, Water Related, by the City of Newport. This zoningdesignation provides for a variety of commercial and water related uses. The subject propertyappears to be an allowed use in this zone. The zoning regulations appear in the Addenda of thisreport.


SUBJECT PHOTOGRAPHS

An easterly view of SW Bay Boulevard, with the subject property on the right.

A westerly view of SW Bay Boulevard, with the subject property on the left.


Subject Photographs

A southeasterly view of the subject property.

A southwesterly view of the subject property.


Subject Photographs

A northeasterly view of the subject property.

A northwesterly view of the subject property.


Subject Photographs

A southwesterly view of the subject property with the dock area on the left.

A northwesterly view of the missing section of dock in the foreground, and the foundation of the subject building in the background.


Subject Photographs

A southeasterly view of the subject property’s dock area from the building’s roof.

A northeasterly view of the subject property’s dock area from the building’s roof.


Subject Photographs

A southwesterly view of Yaquina Bay from subject property’s roof.

A southeasterly view of Yaquina Bay from subject property’s roof.


Subject Photographs

An interior view of the subject’s 2 floor office area.nd

An interior view of the subject’s 2 floor office area.nd


Subject Photographs

An interior view of the subject’s 2 floor warehouse area.nd

An interior view of the subject’s 2 floor warehouse area.nd


Subject Photographs

An interior view of the subject’s 1 floor warehouse area.st

An interior view of the subject’s 1 floor warehouse area.st


SITE DESCRIPTION

Size: 13,068 square feet or 0.30 acres (upland and tideland) +9,188 square feet or +0.21 acre (submerged land)22,256 square feet or 0.51 acres (total)

It should be noted that the size of the site is based on the size statedon the assessor’s map (for the city owned upland and tideland) andthe size stated in the DSL ground lease (for the DSL ownedsubmerged land). It is assumed that the size is accurate for thepurpose of this analysis. However, if there is a concern as to thesize of the site, a survey of the site completed by ansurveyor/engineer is strongly advised.

Shape: A basically rectangular shaped parcel except for a slight anglefollowing the harbor line, with 175 feet of frontage on SW BayBoulevard and 175 feet of frontage on Yaquina Bay’s 25 foot ±deep draft channel. Together, the submerged DSL land and the Cityof Newport land, create a site that extends from the street to thedeep draft harbor.

Topography: The building and docks are level and at street grade. Below thebuilding and docks there is minimal upland area, with most of theproperty inundated by tides on a daily basis. That area appears to bereasonably stable. Tides regularly flood the ground under thesubject improvements up to this bulkhead line. Soil conditions areassumed to be bay mud with a mixture of rock and debris fromindustry over time.

Utilities- Water: City of Newport Sewer: City of Newport Electricity: Central Lincoln PUD Telephone: CenturyLink and Pioneer Telephone Natural Gas: Northwest Natural Gas Street Improvements: SW Bay Boulevard is a two-way (east/west bound), two-lane,

asphalt paved commercial arterial with concrete curbs, gutters andsidewalks.

Access: Direct access is considered good via SW Bay Boulevard. Generalaccess is considered good with the Coast Highway (Highway 101)


Site Description

carrying traffic in a north/south direction, and SE and SW BayBoulevard carrying traffic in a north/south turning into an east/westdirection. Highway access is considered good via Coast Highway(Highway 101) located approximately ½ mile west of the subject.Overall, access is considered good.

Exposure: Exposure is considered good from SW Bay Boulevard.

View Amenity: The site has an excellent unobstructed view of the Yaquina Bay.

Flood Plain: According to the Federal Emergency Management Agency (FEMA)Flood Insurance Map, Community Panel No. 41041C0368D, datedDecember 18, 2009, the subject is situated in Zone AE, an areadetermined to be within the 100-year flood. However, although thesubject land is often nearly 100% inundated at high tide, the streetlevel docks and building are built over columns sunken into the bayfloor and appear to be above the 100 year flood plain. Thus, it is anassumption of this report that flood insurance is not required on theimprovements. If there is a concern with regard to possible floodinsurance, further research by an flood insurance expert is advised.

Hazardous Wastes: An environmental assessment of the subject property was notprovided by the client. Upon physical inspection of the subjectproperty, it did not appear that any hazardous wastes exist or werebeing created by the subject property’s present use. However, itshould be understood that the appraiser is not an expert in the fieldof environmental contamination.

It is an assumption of this appraisal report that there are nohazardous wastes on the subject property. If there is a concernwith regard to possible site contamination or hazardousmaterials, further research by an environmental expert isadvised.

Summary: Overall, the subject property has good access and exposure. The sitewould provide an adequate level of utility to water related andcommercial users.


IMPROVEMENT DESCRIPTION

The subject property is a 17,240 square foot, two-story, warehouse building, with 8,656 squarefeet on the 1 floor and 8,584 square feet on the 2 floor. The structure contains approximatelyst nd

2,000 square feet (11.60%) of finished 2 floor office and restroom space. The 1 and 2 floorsnd st nd

are connected by two interior stairways. The building was constructed in 1981. The structure isutilized as a fish processing facility. A more detailed description of the individual subjectimprovements is given below.

It should be noted that the size of the building is based on measurements taken by the appraiser.It is assumed that the size is accurate for the purpose of this analysis. However, if there is aconcern as to the size of the building, a survey of the building completed by an engineer/architectis strongly advised.

The exterior walls are constructed of concrete block. The eave height is 36 feet and the interiorclear height in the 1 floor warehouse is 14 feet. The roof is flat, with a membrane cover overst

wood/steel decking and a truss system. The roof was reportedly replaced with a vinyl coveringin 2013. The structure is built out over Yaquina Bay (i.e. ocean salt water) and is supported bycolumns sunken into the bay floor. The foundation consists of 12" galvanized steel pipe which isset at either vertical or angled positions under large galvanized steel I-beams 12" wide by 24" tall.They appear to be set on 24' centers, running both ways. Between the large steel I-beams aresmaller 8" x 24" I-beams and the floor system begins with a galvanized steel waffle pan on top ofwhich is the concrete floor inside of the building.

At the front of the building is a carport like design that allows vehicular access to waste hoppers.Access to the processing area is by way of an electrically operated roll-up door and two pedestriandoors facing the street, plus a door at the southwest corner. Access from the bay side is by wayof three roll-up doors plus a single pedestrian door. There are no other wall openings on the northor south sides with the exception of single windows on the upper floor at the rear or bay side. Theproduction area of the plant is somewhat small when compared to typical processing facilities.There is also an opening in the middle of the production area to the 2 floor to provide access fornd

supplies and this access is assisted by a 1-ton rail hoist that would allow easy access of product,materials, equipment, furniture or nearly any other item to this 2 floor area. nd

The floor coverings consist of a vinyl in the office and restroom areas, and concrete in thewarehouse sections. The ceilings consist of a combination of plywood and sheet steel skin on the1 floor and acoustical tiles in T-bar frames on the 2 floor. Interior walls consist of paintedst nd

drywall in the office and restroom areas, and concrete block in the warehouse sections. Interiorlighting consists of ceiling mounted fluorescent fixtures in the office areas and metal halide lampsin the warehouse sections. Heating in the office areas is provided by electric baseboard units. Thebuilding contains a fire sprinkler system. Men's and women's lockers and restrooms are on the2 floor and are considered to be adequate for a fish processing facility. The men’s restroomnd


Improvement Description

contains 6 sinks and 4 toilets (there are 8 stalls but only 4 working toilets), and the women’srestroom contains 3 sinks and 3 toilets. There is an additional restroom with a toilet and sink.There is also an employee lounge on the 2 floor. The building appears to be served by 120/480nd

volt, 400+ amp, 3-phase electrical service. Windows are double pane glass in metal frames andare located in the 2 floor office area. Exterior doors are metal. There is a new freezer in the 1nd st

floor warehouse area, but the freezer this is considered personal property and is not included inthe appraisal report.

The site improvements consist of the dock which is adjacent to the building on the eastern portionof Tax Lot 2100. There are 2,652 square feet of good concrete dock, 520 square feet of newlyreplaced wood dock, 3,080 square feet of decaying, but usable wood dock, 2,662 square feet ofmarginal dock and 5,517 square feet of wharf that is judged to be not useable. The unusable 5,517square feet of wharf has pilings and dock areas that are in poor condition due to decaying pilings,decaying headers, exposed and rusting rebar outside the slab, rotten pile caps, spalling on piersand jury-rigged supports. The pilings and supporting structure was originally built in the 1930sand some areas clearly have not been maintained. The useable dock area is 8,914 square feet. Thesubject’s land-to-building ratio is 1.29 to 1 (based on total site area).

The information presented is a basic description of the subject property improvements. Reliance has been placed upon information provided by the property owner, the LincolnCounty building records, and a physical inspection of the property. It is assumed there areno hidden defects, and that all structural components are functional and operational. Ifquestions arise regarding the integrity of the structure or its operational components, it maybe necessary to consult additional professional resources.


ANALYSES ANDCONCLUSIONS

HIGHEST AND BEST USE

The term "Highest and Best Use" was previously defined. The definition applies specifically tothe highest and best use of land. It is recognized that in the case where the site has existingimprovements, highest and best use may very well be determined to be different from its presentuse. The existing use will continue however, unless and until land value in its highest and best useexceeds the total value of the property in its existing use.

In order to pass the test of highest and best use, a property must be legally permissible, physicallypossible, and financially feasible or marketable. Therefore, in the measurement of highest and bestuse, the ability of the subject property to meet these criteria, as vacant and as improved, wasanalyzed. As vacant, a fish processing facility or commercial waterfront use would be consideredthe highest and best use for the subject property. As improved, the existing fish processing facilityis considered the highest and best use of the subject property.

The subject property is a 17,240 square foot, two-story, warehouse building, with 8,656 squarefeet on the 1 floor and 8,584 square feet on the 2 floor. The structure contains approximatelyst nd

2,000 square feet (11.60%) of finished 2 floor office and restroom space. The 1 and 2 floorsnd st nd

are connected by two interior stairways. The building was constructed in 1981. The structure isutilized as a fish processing facility.

The surrounding properties in close proximity to the subject in Newport’s Bayfront Districtinclude fish processing facilities, retail buildings, restaurants and residential condominiums. Basedon the surrounding uses in the immediate vicinity and the building’s situation adjacent to YaquinaBay, the subject's location is considered to be good for fish processing facility use. There are threeother fish processing companies in Newport along the waterfront of Bay Boulevard, includingHalmark (retail and processing), Trident (processing and canning) and Pacific Seafoods(processing and canning). Other areas in Oregon with fish processing and cannery facilities includeCoos Bay (with two) and Astoria (with ten). It appears that demand is adequate for a fishprocessing facility, but it is somewhat unknown that if the current tenant were to vacate thepremises, if there would be enough demand from another company to continue to use the subjectas a fish processing facility. An alternative use for the subject could be a retail building, restaurantor brewery which could benefit from the excellent views of the adjacent Yaquina Bay. Demandfor retail and restaurant space in Newport’s Bayfront District is considered to be good.

According to local real estate brokers who are active in the subject's market, locating a purchaserto buy a 17,240 square foot, two-story, warehouse building adjacent to Yaquina Bay would notbe too difficult, given a reasonable asking price and slightly longer than typical marketing period.Somewhat similar type buildings have been selling from approximately $60.00 to $120.00 persquare foot.


Highest and Best Use

The subject’s land to building ratio is 1.29 to 1 (based on total site area), which is below themarket norm of 3.00 to 1 for similar type properties. This would make the subject less desirableto users who require a significant amount of yard area for storage or on-site parking.

Based on the preceding analysis, the highest and best use for the subject property as improved, isfor its existing fish processing facility use.


COST APPROACH

The Cost Approach is based on the principle that the value of the property is significantly relatedto its physical characteristics and that no one would pay more for a property than it would cost tobuild a like facility in today's market on a comparable site. In this approach, the market value ofthe site is estimated and added to the estimated depreciated value of the improvements.

Land Value Estimate

In this section, the market value of the subject land will be estimated by comparing it with recentland sales located in the subject property neighborhood and similar areas. The land salescomparables are somewhat similar to the subject property in many ways, including location, size,zoning, shape, access, exposure, view amenity and level of utilities. These factors are allconsidered important to site values.

Unit of Comparison

Commercial land is typically valued using the price per square foot unit of comparison for smallto medium sized sites (under 10 acres in size). The price per square foot is utilized in this analysisreflecting the market for commercial sites similar to the subject. Comparables with somewhatsimilar characteristic to the subject property such as location, size, zoning, shape, access,exposure, topography, view amenity and level of utilities were utilized in the analysis.

Adjustments

The limited number of sales in the subject's immediate area and the lack of uniformity within themarket prevents direct extraction of adjustments from the marketplace. General analysis reflectingmarket behavior is utilized to determine which comparables are superior or inferior to the subject. This analysis establishes value parameters for the subject, allowing for a final conclusion of value.

On the following pages are a land sales map and a land sales tabulation chart. The narrative sectionof the report continues following this section.


Cost Approach

LAND SALES TABULATION CHART

No. Location Date SizeSF

Zoning SalePrice

Price/SF

1 209 NW Coast StreetNewport, Oregon

8/15Listing

5,175 C-2 $200,000 $38.65

2 267 SW Bay BoulevardNewport, Oregon

5/14 4,792 Upland +15,208 DSL

20,000 Total

W-2 $800,000 $40.00

3 1800 Block N. Coast Highway(Highway 101)Newport, Oregon

1/14 21,780 C-3 $675,000 $30.99

4 300 Block SE Bay BoulevardNewport, Oregon

12/12 19,500 W-2 $415,000 $21.28

5 1801 North Coast Highway(Highway 101)Newport, Oregon

12/10 22,000 C-3 $600,000 $27.27

6 1204 SE Bay BoulevardNewport, Oregon

3/10 19,166 W-2 $285,000 $14.87


12/00 9,148 W-2 $352,220 $38.50


12/00 7,405 W-2 $395,000 $53.34

Subject 813 SW Bay BoulevardNewport, Oregon

13,068 Upland +9,188 DSL 22,256 Total

W-2


Cost Approach

Discussion of Land Sale Comparables

The comparable land sales indicate sales prices ranging from $14.87 to $53.34 per square foot,and have sizes ranging from 5,175 to 22,000square feet. The subject site contains 22,256 squarefeet, of which 13,068 square feet is upland and tideland and 9,188 square feet is submerged landparcel that is ground leased from the DSL. Thee have been a limited number of recent commercialland sales in Newport during the past three years, therefore several older land sales in Newportwere also utilized in the analysis. The comparable land sales represent the best available data.

The high end of the range is indicated by Land Sales 1 ($38.65/sf), 2 ($40.00/sf), 3 ($30.99/sf), 7 ($38.50/sf) and 8 ($53.34/sf). Land Sale 1 is similar to the subject in terms of location, zoning,shape, access, exposure and level of utilities. The comparable is superior to the subject in termsof its smaller size and listing (unsold) status, but these factors are partially offset by thecomparable’s lack of a view amenity. All other factors being equal, smaller sites typically sell fora higher price per square foot than larger sites. This sale is considered a slightly high indicator ofvalue for the subject. Land Sale 2 is similar to the subject in terms of location, size, zoning, shape,access, exposure, shape, level of utilities and Yaquina Bay view amenity. The property waspurchased by a buyer who was reportedly motivated do to a1031 exchange. This sale representsa high indicator of value for the subject. Land Sale 3 is similar to the subject in terms of location,size, zoning, shape, access, exposure and level of utilities. The comparable is inferior to thesubject in terms of its lack of a view amenity. This sale is regarded as a low indicator of value forthe subject. Land Sale 7 is similar to the subject in terms of location, zoning, shape, access,exposure, level of utilities and Yaquina Bay view amenity. The comparable is superior to thesubject in terms of its smaller size. This sale is considered a high indicator of value for the subject.Land Sale 8 is similar to the subject in terms of location, zoning, shape, access, exposure, levelof utilities and Yaquina Bay view amenity. The comparable is superior to the subject in terms ofits smaller size. This sale represents a high indicator of value for the subject.

The low end of the range is indicated by Land Sales 4 ($21.28/sf), 5 ($27.27/sf) and 6 ($14.87/sf).Land Sale 4 is similar to the subject in terms of location, size, zoning, shape, access, exposure,shape and level of utilities. The comparable is inferior to the subject in terms of its more limitedview amenity. This sale is regarded as a low indicator of value for the subject. Land Sale 5 issimilar to the subject in terms of location, size, zoning, shape, access, exposure and level ofutilities. The comparable is inferior to the subject in terms of its lack of a view amenity. This saleis considered a low indicator of value for the subject. Land Sale 6 is similar to the subject in termsof size, zoning, shape, access, exposure and level of utilities. The comparable is inferior to thesubject in terms of its location east of the Bayfront District’s main retail area and more limitedview amenity. This sale represents a very low indicator of value for the subject.


Cost Approach

Site Value Conclusion

Based on the subject site's location, size, zoning, shape, access, exposure, view amenity and levelof utilities; and placing primary emphasis on Land Sales 1, 2, 3, 4, 7 and 8; a per unit valuebetween $30.00 and $40.00 per square foot, say $35.00 per square foot, is concluded for thesubject site. The value of the subject site is estimated as follows:

$35.00 square foot x 22,256 square feet = $778,960

Improvement Cost Analysis

Base Costs

In analyzing the improvement replacement cost new, the Marshall Valuation Service, a nationallyrecognized cost estimation service, is utilized. The Marshall Valuation Service provides a basecost per square foot factor for buildings. The base cost factor is then adjusted for buildingparticulars such as height and perimeter, as well as regional and local cost differences.Adjustments are made on a per square foot or percentage basis as provided for by the service. Thepublished costs include all direct costs for the base structure and tenant improvements, and thefollowing indirect costs:

(1) plans, specifications, and building permits, including engineer’s andarchitect’s fees;

(2) normal fees and interest on construction funds during the constructionperiod;

(3) normal site preparation including finish, grading and excavation forfoundation and backfill for the structure only;

(4) utilities from the structure to the lot line figured for typical setback; and

(5) contractor’s overhead and profit.

Building

It should be noted that the Marshall Valuation Service does not provide a cost for a fish processingfacility. Therefore, the most similar category is utilized in the analysis. According to the MarshallValuation Service, Section 14, Page 26, February 2014; the subject building is best identified asa Good Quality Class “C” Storage Warehouse. The cost service indicates a base price of $58.26


Cost Approach

per square foot. Adding the cost of fire sprinklers results in an adjusted base cost of $59.76 persquare foot ($58.26/sf + $1.50/sf). Based on a cumulative multiplier that adjusts the property forheight, perimeter, current and local costs (a multiplier of 1.2099), the adjusted price is $72.30 persquare foot ($59.76/sf x 1.2099). In addition, the subject structure is built on support columns outover Yaquina Bay (i.e. ocean salt water) and this factor is estimated to add 15.00% to the costcompared to a structure with a foundation built on level dry soil. Thus, the adjusted cost is $83.15($72.30 x 1.15) This results in a total replacement cost for the building of $1,433,506 ($83.15/sfx 17,240 sf).

Site Improvements

The site improvements consist of the dock which is adjacent to the building on the eastern portionof Tax Lot 2100. There are 2,652 square feet of good concrete dock, 520 square feet of newlyreplaced wood dock, 3,080 square feet of decaying, but usable wood dock, 2,662 square feet ofmarginal dock and 5,517 square feet of wharf that is judged to be not useable. The unusable 5,517square feet of wharf has pilings and dock areas that are in poor condition due to decaying pilings,decaying headers, exposed and rusting rebar outside the slab, rotten pile caps, spalling on piersand jury-rigged supports. The pilings and supporting structure was originally built in the 1930sand some areas clearly have not been maintained. The useable dock area is 8,914 square feet. Thesite improvement costs were based on local cost comparables and the Marshall Valuation Service.The total site improvement cost is estimated at $267,420.

Dock: $30.00/sf x 8,914 sf = $267,420Total Site Improvement Cost: $267,420

Total Replacement Cost

Building: $1,433,506Site Improvements: + 267,420Total: $1,700,926

Absorption Costs

Leasing commission costs are typically included in the costs for multi-tenant buildings built on aspeculative basis, but not included in the costs for properties built by owner/users. Since thesubject property is an owner/user type property, leasing commission costs are not included in thecost estimate.


Cost Approach

Entrepreneurial Profit

Entrepreneurial profit compensates the developer for project risk and management. This costcomponent includes office overhead, staff, and profit. Entrepreneurial profit generally rangesbetween 5.00% and 15.00% of the cost of the improvements depending upon project size,location, and marketability. Typically, developers building multi-tenant projects on a speculativebasis require returns at the high end of the range, while owner/user developers require returns atthe low end of the range. The low end of the range is considered appropriate for a property likethe subject. Utilizing an entrepreneurial profit of 5.00%, results in a total replacement cost newof $1,785,972 ($1,700,926 x 1.05).

Depreciation

There are three types of depreciation: physical, functional and external. All three types ofdepreciation have been considered and it is concluded that only physical depreciation exists on thesubject. The subject property has an actual age of 34 years and an effective age of 20 years.According to the Marshall Valuation Service, the subject property will have a total economic lifeof 45 years, which indicates a remaining economic life of 25 years (45 years - 20 years). Thisresults in the subject improvements being 44.44% depreciated (20 ÷ 45) utilizing the age-lifemethod of depreciation. The improvements’ physical depreciation is estimated at $793,686($1,785,972 x 0.4444). The depreciated value of the improvements is estimated at $992,286($1,785,972 - $793,686).

Cost Approach Summary

Adding the land value to the depreciated value of the improvements equals $1,771,246 ($992,286+ $778,960), rounded to $1,770,000. The value conclusion for the subject property via the CostApproach is summarized in the table below.

Cost Approach Summary Table

Improvement Cost New: $1,785,972 Less Depreciation: - 793,686Depreciated Replacement Cost: $992,286 Plus Land Value: + 778,960Indicated Value via the Cost Approach: $1,771,246

Rounded to: $1,770,000

$1,770,000


SALES COMPARISON APPROACH

The Sales Comparison Approach is based on the principle of substitution This principle states thatno one would pay more for the subject property than the value of similar property in the market. In active markets with a large number of physically similar comparables, this approach is generallyconsidered to be a good indicator of value. However, the use of this approach is limited, becausemany properties have unique characteristics which cannot be accounted for in the adjustmentprocess.

Unit of Comparison

The direct sales comparison will be analyzed on a price-per-square foot basis. The price-per-square foot is calculated by dividing the selling price by the square footage of the individualimprovements. In selecting an appropriate selling price per square foot for the subject, it isimportant to recognize within the sales the differences in the physical characteristics of each ofthose sales as they relate to the subject. Location, size, age, quality, condition, access, exposure,view amenity and land-to-building ratio are typically the most important characteristics.

Adjustments

The limited number of sales in the subject's immediate area and the lack of uniformity within themarket prevents direct extraction of adjustments from the marketplace. General analysis reflectingmarket behavior is utilized to determine which comparables are superior or inferior to the subject. This analysis establishes value parameters for the subject, allowing for a final conclusion of value.

It should be noted that there has not been a sale of a fish processing facility in Oregon for over tenyears. Therefore, sales of somewhat similar office, retail and warehouse buildings in Coos Bay,Lincoln City and Newport were utilized in the analysis. While few of the comparables are directlycomparable physically, they represent the best data available.

The following section contains improved sales photographs, an improved sales map, and animproved sales tabulation chart. The narrative section of the report continues following thissection.


Sales Comparison Approach

IMPROVED SALES PHOTOGRAPHS

Improved Sale No. 1

Improved Sale No. 2



Improved Sale No. 3

Improved Sale No. 4



Improved Sale No. 5

Improved Sale No. 6



Improved Sale No. 7

Improved Sale No. 8



Improved Sale No. 9

Improved Sale No. 10


IMPROVED SALES TABULATION CHART

SaleNo.

Location Date SizeSF

YearBuilt

L/BRatio

Condition SalePrice

SalePrice

1 837-855 SW Bay BoulevardNewport, Oregon

8/15 Listing

5,235 1976 0.83 to 1 Average $795,000 $151.86

2 232 SW Coast HighwayNewport, Oregon

9/14 6,199 1938 1.41 to 1 Average $250,000 $40.33

3 334 SW 7 Streetth

Newport, Oregon4/14 3,264 1988 2.94 to 1 Average $350,000 $107.23

4 2273 Bayshore DriveCoos Bay, Oregon

9/13 28,048 2006 4.27 to 1 Average $1,600,000 $57.05

5 91147 Cape Arago HighwayCoos Bay, Oregon

8/13 38,454 1972 10.98 to 1 Average $850,000 $22.10


3/13 1,391 1960 2.59 to 1 Average $185,000 $133.00

7 225 NE 73 Streetrd

Newport, Oregon10/12 4,378 2003 2.69 to 1 Average $275,000 $62.81

8 1430 NE Highway 101Lincoln City, Oregon

4/12 21,778 1940 2.38 to 1 Average $985,000 $45.23

9 808 SW Bay Boulevard Newport, Oregon

6/07 3,157 1960 1.10 to 1 Average $575,000 $182.13


5/07 8,250 1970 1.95 to 1 Average $667,829 $80.95

Subject 813 SW Bay BoulevardNewport, Oregon

17,240 1981 1.29 to 1 Average


Discussion of Improved Sale Comparables

The improved sales reflect a sales price range of $22.10 to $182.13 per square foot. It should benoted that there has not been a sale of a fish processing facility in Oregon for over ten years.Therefore, sales of somewhat similar office, retail and warehouse buildings in Coos Bay, LincolnCity and Newport were utilized in the analysis. While few of the comparables are directlycomparable physically, they represent the best data available.

Improved Sale 1 is the August 2015 listing of a 5,235 square foot multi-tenant retail buildinglocated at 837-855 SW Bay Boulevard, Newport, Oregon. The comparable is located adjacent tothe subject on the west. In comparison to the subject, the comparable is similar in terms of itslocation, quality, condition, access, exposure and view amenity. The comparable is superior tothe subject in terms of its smaller size and listing (un-sold) status; but these factors are partiallyoffset by the comparable’s older age and smaller land-to-building ratio. All other factors beingequal, smaller buildings typically sell for a higher price per square foot than larger buildings.Overall, this comparable’s listing price of $151.86 per square foot is considered a high indicatorvalue for the subject property.

Improved Sale 2 is the September 2014 sale of a 6,199 square foot office/retail building locatedat 232 SW Coast Highway, Newport, Oregon. In comparison to the subject, the comparable issimilar in terms of its location, quality, access and exposure. The comparable is superior to thesubject in terms of its smaller size and larger land-to-building ratio; but these factors are more thanoffset by the comparable’s older age, inferior condition and lack of view amenity. Overall, thecomparable’s sale price of $40.33 per square foot represents a low indicator value for the subjectproperty.

Improved Sale 3 is the April 2014 sale of a 3,264 square foot office building located at 334 SW7 Street, Newport, Oregon. In comparison to the subject, the comparable is similar in terms ofth

its location, quality, access and exposure. The comparable is superior to the subject in terms ofits smaller size, newer age, condition and larger land-to-building ratio; but these factors arepartially offset by the comparable’s lack of view amenity. Overall, this comparable’s sale priceof $107.23 per square foot is regarded as a high indicator value for the subject property.

Improved Sale 4 is the September 2013 sale of a 28,048 square foot warehouse building locatedat 2273 Bayshore Drive, Coos Bay, Oregon. In comparison to the subject, the comparable issimilar in terms of its quality, condition, access and exposure. The comparable is superior to thesubject in terms of its newer age and larger land-to-building ratio, but these factors are more thanoffset by the comparable’s inferior location, larger size and lack of view amenity. Overall, thecomparable’s sale price of $57.05 per square foot is considered a low indicator value for thesubject property.



Improved Sale 5 is August 2013 sale of a 38,454 square foot mixed-sue waterfront warehousebuilding located at 91147 Cape Argo Highway, Coos Bay, Oregon. In comparison to the subject,the comparable is similar in terms of its quality, access, exposure and view amenity. Thecomparable is superior to the subject in terms of its larger land-to-building ratio; but this factoris more than offset by the comparable’s inferior location, larger size, older age and inferiorcondition. Overall, the comparable’s sale price of $22.10 per square foot represents a very lowindicator value for the subject property.

Improved Sale 6 is the March 2013 sale of a 1,391 square foot retail building located at 146 SWBay Boulevard in Newport, Oregon. In comparison to the subject, the comparable is similar interms of its location, quality, condition, access and exposure. The comparable is superior to thesubject in terms of its smaller size and larger land-to-building ratio; but these factors are partiallyoffset by the comparable’s older age and more limited view amenity. Overall, this comparable’ssale price of $133.00 per square foot is regarded as a high indicator of value.

Improved Sale 7 is the October 2012 sale of a 4,378 square foot warehouse building located at225 NE 73 Street, Newport, Oregon. In comparison to the subject, the comparable is similar inrd

terms of its quality, condition and access. The comparable is superior to the subject in terms ofits smaller size, newer age and larger land-to-building ratio; but these factors are more than offsetby the comparable’s inferior location, exposure and lack of view amenity. Overall, thecomparable’s sale price of $62.81 per square foot is considered a low indicator of value for thesubject property.

Improved Sale 8 is the April 2012 sale of a 21,778 square foot retail/warehouse building locatedat 1430 NE Highway 101, Lincoln City, Oregon. In comparison to the subject, the comparableis similar in terms of its location, quality, condition, access and exposure. The comparable issuperior to the subject in terms of its larger land-to-building ratio; but this factor is more thanoffset by the comparable’s larger size, older age and lack of view amenity. Overall, thecomparable’s sale price of $45.23 per square foot represents a low indicator of value for thesubject property.

Improved Sale 9 is the June 2007 sale of a 3,157 square foot retail/restaurant building located at808 SW Bay Boulevard, Newport, Oregon. In comparison to the subject, the comparable is similarin terms of its location, quality, condition, access, exposure and land-to-building ratio. Thecomparable is superior to the subject in terms of its smaller size and the passage of time (themarket was stronger in 2007); but these factors are partially offset by the comparable’s older ageand more limited view amenity. Overall, this comparable’s sale price of $182.13 per square footis regarded as a very high indicator of value for the subject property.



Improved Sale 10 is the May 2007 sale of a 8,250 square foot retail/restaurant building locatedat 836 SW Bay Boulevard, Newport, Oregon. In comparison to the subject, the comparable issimilar in terms of its location, quality, access and exposure. The comparable is superior to thesubject in terms of its smaller size, larger land-to-building ratio and the passage of time (themarket was stronger in 2007); but these factors are more than offset by the comparable’s olderage, inferior condition and more limited view amenity. Overall, the comparable’s sale price of$80.95 per square foot is considered a low indicator of value for the subject property.

Summary of Improved Sale Comparables

The comparables sales indicate a sales price per square foot range of $22.10 to $182.13 per squarefoot. While few of the comparables are directly comparable physically, they represent the best dataavailable.

Placing primary emphasis on Improved Sale Nos. 1, 3, 4, 6, 7 and 10; a per unit value of $100.00per square foot is concluded for the subject property. This indicates a value via the SalesComparison Approach of $1,724,000 ($100.00/sf x 17,240 sf), rounded to $1,725,000.

$1,725,000


INCOME APPROACH

The Income Approach is based on the premise that commercial properties are income producing,and that investors purchase these properties based on their income-producing ability. In the IncomeApproach, market rents for the subject property are estimated, the applicable vacancy andoperating expenses are deducted, and the resulting net income is capitalized into a value estimate.In this analysis, the Income Approach is not utilized due the fact that most properties of thesubject’s type are owner occupied in the local market, and thus there are few rent comparables.Also, there are few sales of similar properties which were leased at the time of sale and indicatecapitalization rates. For these reasons, this approach has not been utilized in this appraisal report.


CORRELATION AND FINAL VALUE CONCLUSION

Cost Approach: $1,770,000Sales Comparison Approach: $1,725,000

The final step in estimating a value for the subject property, is the analysis of the valueconclusions realized from each separate approach for the subject property, and weighing thestrengths, weaknesses and the reliability of each of those approaches as they relate to the subject.

The Cost Approach is judged to yield a reliable indicator for buildings similar to the subject if thebuilding is proposed, reasonably new or of a special use nature. The land value is adequatelysupported by the availability of sales transactions of comparable sites. The construction costs ofthe subject property were based on the Marshall Valuation Service. Physical deprecation wasestimated on the improvements. The Cost Approach is given about emphasis in the final valueconclusion, as it is often relied upon relied upon by owner/user purchasers if no substituteproperties are available for sale in the market and the only option is to build new.

The Sales Comparison Approach is often utilized by buyers and sellers when deciding toacquire/sell a property. The Sales Comparison Approach utilized the sales price per square footas the unit of comparison. The comparables pose some problems in terms of physicalcomparability, and greatest emphasis was placed on the most physically similar comparables. TheSales Comparison Approach is also given about equal emphasis in the final value conclusion, asit is often relied upon by both owner/user and investor purchasers.

It is concluded that the Cost Approach and Sales Comparison Approach are both reliable indicatorsof value for a property similar to subject. Therefore, about equal emphasis is placed on the CostApproach and the Sales Comparison Approach.

Based upon my investigation and analysis of market data, and subject to the definitions,certifications, and limiting conditions set forth in the attached report, it is my opinion that thesubject property’s fee simple market value, on June 25, 2015, was as follows:



Correlation and Final Value Conclusion

Leasehold Valuation

The subject site consists of a 13,068 square foot or 0.30 acre section which is owned by the Cityof Newport, and a 9,188 square foot or 0.21 acre portion which is submerged land that is ownedby the Division of State Lands (DSL). The 9,188 square foot or 0.21 acre portion is ground leasedfrom the Oregon State Land Board and the Division of State Lands (landlord) to the NewportUrban Renewal Agency, i.e. the City of Newport (tenant). The ground lease is for a 17-year term.The ground lease commenced on November 1, 1998 and terminates on October 31, 2018. Thereare approximately 3 years (i.e. 40 months) remaining on the ground lease. The current ground rentis $4,425.62 per year. The ground rent increases annually in accordance with the provisions ofthe Oregon Administrative Rule in effect at the time. The ground lease is structured on a triple netexpense basis; where the tenant pays for the real estate taxes, fire insurance and utilities. Thetenant shall have the option to renew this lease for an additional period of 15 years after theoriginal term and each renewal term provided that the tenant has submitted a completed renewalapplication form not less than 180 days prior to the expiration of the lease. Upon receipt of theapplication, the lease shall be renewed by the landlord unless: (1) the landlord determines, in itssole discretion, that the tenant has not complied with the terms of this lease, the applicable statutesand Oregon Administrative Rules; (2) the tenant is no longer the preference right holder as definedby applicable state law; or (3) the landlord determines that the renewal of this lease for all orportions of the leasehold would be contrary to local, state, or federal law, or would be inconsistentwith the policies set forth in OAR 141-082-0010.

Thus, as long as the tenant submits a renewal application and complies with the terms of the leaseand the three stated conditions, it appears that the tenant can continue to renew the lease for 15year terms into perpetuity. The appraiser spoke with Chuck Perino of the Division of State Lands,and he also indicated that as long as the tenant submits a renewal application and complies withthe terms of the lease and the three stated conditions, the tenant can continue to renew the leasefor 15 year terms into perpetuity. Therefore, it is an extraordinary assumption of this appraisalreport that the tenant will exercise the 15 year renewal options in the ground lease at least threetimes, which will results in a remaining ground lease term of at least 48 years [3 year initial term+ (15 years x 3 renewal options)]. It should be noted that if the tenant does not exercise all threeof the renewal options, then the leasehold value conclusion in this appraisal report would not beconsidered valid. It should be noted that the 48 year remaining ground lease term is for a periodlonger than the estimated remaining economic life of the building. In addition, it is assumed that(1) the City of Newport would facilitate a re-assignment of the existing Division of State Landsground lease to a new buyer of the subject property, (2) the Division of State Lands ground leasewould be re-assigned to the purchaser of the subject property without significant difficulty orexpense and in a timely manner, and (3) that environmental issues will not be encountered andenvironmental studies will not be necessary.


Correlation and Final Value Conclusion

A potential purchaser of the subject would see the ground lease payment as an additional expensefor the property, and therefore capitalizing the annual ground lease payment and subtracting thiscapitalized amount from the fee simple value is viewed as the best way to determine the leaseholdvalue of the subject property.

The current ground rent is $4,425.62 annually. Concerning the capitalization rate, a fee simplecapitalization rate of 8.00% is estimated for the subject, based on a review of rates of returns ofsomewhat similar type ground leases. The contract ground rent appears to be at a market rentlevel, so there is no increased risk due to an above market ground rent. In regard to the groundlease term, it is for a period of 48 years (assuming the tenant will exercise three renewal options)which is much longer than the estimated 25 year remaining economic life of the improvements,so there is no increased risk due to a ground lease term that is less than the remaining economiclife of the improvements. The capitalization rate conclusion also takes into consideration the factthat all other things being equal, a typical buyer would prefer to own both the buildings and site(fee simple) vs. owning the buildings and ground leasing the site (leasehold), but the longer theremaining ground lease term (particularly if the remaining term is longer than remaining economiclife of the improvements), the less relevant this factor becomes. Therefore, a capitalization rateof 8.00% is concluded to be an appropriate rate for the leasehold valuation of the subject.

Fee Simple Value: $1,750,000 Less Capitalized Annual Ground Rent ($4,425.62 ÷ 0.08): - 55,320 Total Leasehold Value: $1,694,680 Rounded to: $1,695,000

Exposure Time

The current market for commercial property is adequate within Newport. The sales cited reflectmarketing times ranging from not offered to 24 months. If the subject were to have been offeredon the market prior to the date of value, it likely could have sold within 12 to 36 months.

Marketing Time

The current market for commercial property is adequate within Newport. The sales cited reflectmarketing times ranging from not offered to 24 months. If the subject were offered on the market,it likely could be sold within 12 to 36 months.


CERTIFICATION

I, Kent D. Voronaeff, MAI, do hereby certify that to the best of my knowledge and belief:

1. The statements of fact contained in this report are true and correct.

2. The reported analyses, opinions, and conclusions are limited only by the reportedassumptions and limiting conditions, and are my personal, impartial, and unbiasedprofessional analyses, opinions, and conclusions.

3. I have no present or prospective interest in the property that is the subject of this report,and no personal interest with respect to the parties involved.

4. I have no bias with respect to the property that is the subject of this report or to the partiesinvolved with this assignment.

5. My engagement in this assignment was not contingent upon developing or reportingpredetermined results.

6. My compensation for completing this assignment is not contingent upon the developmentor reporting of a predetermined value or direction in value that favors the cause of theclient, the amount of the value opinion, the attainment of a stipulated result, or theoccurrence of a subsequent event directly related to the intended use of this appraisal.

7. My analyses, opinions, and conclusions were developed, and this report has been prepared,in conformity with the Uniform Standards of Professional Appraisal Practice.

8. I, Kent D. Voronaeff, MAI, have made a personal inspection of the property that is thesubject of this report. In addition, I, Kent D. Voronaeff, MAI, have made a personalinspection of the comparable sales.

9. No one provided significant real property appraisal assistance to the person signing thiscertification.

10. The use of this report is subject to the requirements of the Appraisal Institute relating toreview of their duly authorized representatives.

11. As of the date of this report, I, Kent D. Voronaeff, MAI, have completed the continuingeducation program for Designated Members of the Appraisal Institute.


Certification

12. I have performed no appraisal services, as an appraiser or in any other capacity, regardingthe property that is the subject of this report within the three year period immediatelypreceding acceptance of this assignment.

13. Based upon my investigation and analysis of market data, and subject to the definitions,certifications, and limiting conditions set forth in the attached report, it is my opinion thatthe values of the subject property, on June 25, 2015, were as follows:

(Fee Simple Value)


(Leasehold Value)

ONE MILLION SIX HUNDRED NINETY FIVE THOUSAND DOLLARS$1,695,000

By______________________________ Kent D. Voronaeff, MAI

State Certification # C000303 Expiration Date: April 30, 2016


ASSUMPTIONS AND LIMITING CONDITIONS

1. The information contained in this report is specific to the needs of the client and for theintended use stated in this report. The appraiser is not responsible for unauthorized use ofthis report.

2. No responsibility is assumed for legal or title considerations. Title to the property isassumed to be good and marketable unless otherwise stated in this report.

3. The property is appraised free and clear of any or all liens and encumbrances unlessotherwise stated in this report.

4. Responsible ownership and competent property management are assumed unless otherwisestated in this report.

5. The information furnished by others is believed to be reliable. However, no warranty isgiven for its accuracy.

6. All engineering is assumed to be correct. Any plot plans an illustrative material in thisreport are included only to assist the reader in visualizing the property.

7. It is assumed that there are no hidden or unapparent conditions of the property, subsoil,or structures that render it more or less valuable. No responsibility is assumed for suchconditions or for arranging for engineering studies that may be required to discover them.

8. It is assumed that there is full compliance with all applicable federal, state, and localenvironmental regulations and laws unless otherwise stated in this report.

9. It is assumed that all applicable zoning and use regulations and restrictions have beencomplied with, unless a nonconformity has been stated, defined, and considered in thisappraisal report.

10. It is assumed that all required licenses, certificates of occupancy or other legislative oradministrative authority from any local, state, or national governmental or private entityor organization have been or can be obtained or renewed for any use on which the valueestimates contained in this report are based.

11. Any sketch in this report may show approximately dimensions and is included to assist thereader in visualizing the property. Maps and exhibits found in this report are provided forreader reference purposes only. No guarantee as to accuracy is expressed or impliedunless otherwise stated in this report. No survey has been made for the purpose of thisreport.


Assumptions and Limiting Conditions

12. It is assumed that the utilization of the land and improvements is within the boundaries orproperty lines of the property described and that there is no encroachment or trespassunless otherwise stated in this report.

13. The appraiser is not qualified to detect hazardous waste and/or toxic materials. Anycomment by the appraiser that might suggest the possibility of the presence of suchsubstances should not be taken as confirmation of the presence of hazardous waste and/ortoxic materials. Such determination would require investigation by a qualified expert inthe field of environmental assessment. The presence of substances such as asbestos, urea-formaldehyde foam insulation, or other potentially hazardous materials may affect thevalue of the property. The appraiser’s value estimate is predicated on the assumption thatthere is no such material on or in the property that would cause a loss in value unlessotherwise stated in this report. No responsibility is assumed for any environmentalconditions, or for any expertise or engineering knowledge required to discover them. Theappraiser’s descriptions and resulting comments are the result of the routine observationsmade during the appraisal process.

14. Unless otherwise stated in this report, the subject property is appraised without a specificcompliance survey having been conducted to determine if the property is or is not inconformance with the requirements of the Americans with Disabilities Act. The presenceof architectural and communications barriers that are structural in nature and would restrictaccess by disabled individuals may adversely affect the property's value, marketability, orutility.

15. It is an extraordinary assumption of this appraisal report that the tenant will exercise the15 year renewal options in the ground lease at least three times, which will results in aremaining ground lease term of at least 48 years [3 year initial term + (15 years x 3renewal options)]. It should be noted that if the tenant does not exercise all three of therenewal options, then the leasehold value conclusion in this appraisal report would not beconsidered valid. It should be noted that the 48 year remaining ground lease term is for aperiod longer than the estimated remaining economic life of the building. In addition, it isassumed that (1) the City of Newport would facilitate a re-assignment of the existingDivision of State Lands ground lease to a new buyer of the subject property, (2) theDivision of State Lands ground lease would be re-assigned to the purchaser of the subjectproperty without significant difficulty or expense and in a timely manner, and (3) thatenvironmental issues will not be encountered and environmental studies will not benecessary.


Assumptions and Limiting Conditions

This appraisal report has been made with the following general limiting conditions:

1. The distribution, if any, of the total valuation in this report between land andimprovements applies only under the stated program of utilization. The separate allocationsfor land and improvements must not be used in conjunction with any other appraisal andare invalid if so used.

2. Possession of this report, or a copy thereof, does not carry with it the right of publication. It may not be used for any purpose by any person other than the party to whom it isaddressed without the written consent of the appraisers, and in any event only with properwritten qualification and only in its entirety.

3. The appraiser, by reason of this appraisal, is not required to give further consultation,

testimony, or be in attendance in court with reference to the property in question unlessarrangements have been previously made.

4. The Americans with Disabilities Act (ADA) became effective January 26, 1992. I havenot made a specific compliance survey and analysis of this property to determine whetheror not it is in conformity with the various detailed requirements of the ADA. It is possiblethat a compliance survey of the property together with a detailed analysis of therequirements of the ADA could reveal that the property is not in compliance with one ormore of the requirements of the act. If so, this fact could have a negative effect upon thevalue of the property. Since I have no direct evidence relating to this issue, I did notconsider possible non-compliance with the requirements of ADA in estimating the valueof the property.

5. Neither all nor any part of the contents of this report (especially any conclusions as tovalue, the identity of the appraiser, or the firm with which the appraiser is connected) shallbe disseminated to the public through advertising, public relations, news, sales, or othermedia without the prior written consent and approval of the appraiser.


ADDENDA

Diagram of the subject site and DSL ground leased submerged land.

Diagram of nautical chart showing water depth adjacent to the subject site.

Documents

APPRAISAL REPORT - legistarweb … · the real estate broker, buyer and/or seller. compliance and competency provision This appraisal has been prepared in compliance with the 2014-2015