Upload
katelin-roundtree
View
223
Download
2
Tags:
Embed Size (px)
Citation preview
Appraising BuildingsISU – Economics 364X
Tim JanssenAppraiser
Farm Credit Services of America
Introductions
NameWhere you’re from (city, county)
Whether or not you grew up on a farm
What kind of operation (grain, livestock, etc.)
ObjectivesUnderstanding the inspection
processTypes of data to be collected
during the inspection processAbility to describe the physical
characteristics of the improvements
Ability to identify functional and external depreciation issues
Identify factors used to estimate RCNs
Preparing for the InspectionKnow what you’re going to see
before you goHave a list of questions before
going outAssessor’s sheetPlans, specs, costs on newer
constructionAerialSoil Map
Information to be CollectedBuilding DescriptionAssess Condition
(Effective Age/Remaining Economic Life)Size/CapacityFunctional Depreciation IssuesExternal Depreciation Issues
DwellingsDescription
◦Types - ranch, multi-story, log, manufactured vs. modular, contemporary
◦Construction Materials◦Interior Features - bedrooms, bathrooms,
kitchen built ins, basement finish, walk-out, fireplaces, floor coverings, quality, etc.
◦HVAC System - forced hot air, geo-thermal
◦Water Source - rural water or well
◦Septic - tank and laterals or public sewer
DwellingsSize - Square Feet of Living Space
◦Above Grade vs. Below Grade◦Use outside measurements◦Ceiling Height - must be at least 5 feet
◦Porches/Decks - open, 3 season vs. 4 season room
◦Bay Windows◦Basement Finish - not included in
square feet calculation
DwellingsFunctional Depreciation Issues
◦Floor Plan and Design◦Garage – number of cars, attached,
detached, built-in, basement
◦Bathroom on second level◦Superadequate Features - pool, jet
tub?, basketball court, theatre room?, quality or size above neighborhood standards, etc.
DwellingsExternal Depreciation Issues
◦Locational Issues - next to livestock confinement buildings, gravel vs. paved road, distance to off-farm employment, etc.
◦Contemporary Designs◦Superadequate for area or economic
conditions◦Economic Considerations -
unemployment rates, interest rates, etc.
DwellingsRCN Guidelines
◦Varies greatly depending on size and design
◦Basic ranch style: $125-175 per square foot
◦Multi story dwellings typically cost less per square foot
◦Log and contemporary designs can cost significantly more on a per square foot basis
Machine Sheds and ShopsSize - square feet based on outside
dimensionsHeight to EavesFeatures
◦Construction - pole vs. wood frame, siding and roof materials
◦Interior features - concrete floor, insulation, heat, interior wall finish, floor drains, etc.
◦Door size and type - sliding, overhead, bi-fold
◦Brand or Builder
Machine Sheds and Shops
Functional and External Issues◦Eave height may limit size of
machinery◦Dimensions may limit size of
machinery◦Superadequacy◦Small acreage wouldn’t need a high
end shop
Machine Sheds and ShopsRCN Guidelines - Machine Sheds
◦ 4000 SF or less: $8.00-11.00/sf.◦4000 SF or more: $7.00-9.00/sf.◦Height to eave: 14’-18’◦Concrete floor: $4.00-5.00/sf.◦Insulation: $1.50-3.00/sf.◦Basic electrical: $0.50-1.00/sf.◦Overhead doors: $2000-10,000/ea.
Machine Sheds and ShopsRCN Guidelines - Shops
◦ 1600 SF or less: $25.00-35.00/sf.◦1600-10,000 SF or more: $20.00-
30.00/sf.◦Height to eave: 16’+/-◦Heaters: $3.00-6.00/sf.◦Radiant in-floor heat: $4.00-6.00/sf.◦Bathroom plumbing: $4.00-10.00/sf.◦Low cost office: $2.00-5.00/sf.
Grain Storage - BinsSize/Capacity
◦Normally measured in bushels Diameter squared X height X 0.628 Formula does not include ‘peaking’
Features◦Dryer◦Aeration floor/fans◦Stirator◦Unloading auger◦Ladder
Grain Storage - Bins
RCN Guidelines◦10,000 to 20,000 bushels: $2.00-
2.60/bushel◦20,000 to 60,000 bushels: $1.50-
2.25/bushel◦60,000+ bushels: $1.25-1.75/bushel◦Drying bins: +$0.20-0.80/bushel for
burners, controls, stirators, stiffeners, and spreaders
Grain Storage - Handling
Grain Leg◦Bushels per hour◦Height◦Drops
Dryers◦Bushels per hour
Hogs - FinishingSize/Capacity
◦Building Size - measured in square feet or head
◦Capacity - 7.5+/- square feet of usable pen space per head (doesn’t include offices & alleys)
Building Features and Designs◦Modern - double curtains, fully slatted,
climate controlled, natural or tunnel ventilation
◦Old Designs - open front, modified open front, “Cargill” finishers
Hogs - FinishingCondition Issues
◦Economic Life: 25 yearsFinishing vs. Wean/Finishing
Contracts◦Finishing: $28-36/pig space◦Wean/Finishing: $34-42/pig space◦Terms: 5-7 years but had been 10 years
External Depreciation Issues◦Hog prices◦Availability of grower contracts
Hogs - Finishing
RCN Guidelines◦Finishing: $205-220/pig space◦Wean/Finishing: $215-230/pig space◦Brooders/Feed Mats: $5-8/pig space◦Generators and compost facilities
would add to cost ◦Offices and showering facilities can
add to cost
Hogs - Farrowing
Size/Capacity◦Normally measured in # of sows◦6.0 to 6.5 Sows per farrowing crate◦Gestation crates◦Holding pens◦Gilt development/isolation space
Hogs - FarrowingFunctional Issues
◦Adequate gestation space◦Adequate sow movement/holding space◦Adequate gilt isolation and
development space◦Sow flow
External Issues◦Feeder pig and market hog prices◦Environmental regulations, permitting,
interest rates, etc.
Hogs - Farrowing
RCN Guidelines◦$1200 to 2000 per sow◦Factors Affecting RCN
Office facilities Developer facilities Gestation type - pen vs. crate
Hogs - NurserySize/Capacity
◦Measured in pig spaces◦3.0-4.0 square feet per head
Functional Issues◦Separate site for bio-security
External Issues◦Feeder and market hog prices,
demand for feeder pigs, availability of contracts, etc.
Hogs - Nursery
RCN Guidelines◦$150 to $200 per pig space◦$30 to $45 per square foot
Cattle – Feedlots & ConfinementsSize/Capacity
◦Square feet per head Confinement
40 sf/head for solid floor 25 sf/head for slatted floors over pits
Open lot 225 sf/head
◦Bunk space per head Confinement: 10” per head Open lot: 12” per head
Cattle - Feedlots & ConfinementsRCN Guidelines
◦Open Lot: $225-275/head◦Confinements:
Solid Floor: $10-15/sf. or $500-700/head Slatted Floors & Pit: $21+/sf. or $1000+/head
Other Considerations◦Add $125-275 per head for feedmill,
grain storage, commodity shed, processing building, etc.
◦Capacity can be limited by permits and manure storage
Cattle - Feedlots & ConfinementsFunctional Issues
◦Bunk space vs. lot space◦Feed storage, mixing, and handling
system◦Manure storage and handling system
(settling basin)◦Receiving/working/shipping facilities
External Issues◦Cattle prices◦Feed prices◦Environmental regulations
Poultry – Laying HensSize/Capacity
◦Stacked Cages: 53-80 sq. in./bird (67 sq. in. per bird is fairly typical)
◦Cage FreeConstruction and Design
◦Hi-Rise vs. Stacked◦Egg Processing - packer, grader, breaker
◦Manure Storage and Handling
Poultry – Laying Hens
RCNs◦Pullet Barns: $10-12/bird
◦Layer Barns: $15-20/bird for standard cage design
◦Packing, breaking, and grading facilities can add significantly to the cost
Poultry – Laying HensFunctional Depreciation Issues
◦Processing building and equipment ‘right sized’ for the number of layers
External Depreciation Issues◦Feed Costs◦Egg Prices◦Availability of Contracts◦Customer Preferences - cage-free vs.
cages, liquid egg vs. table eggs, etc.
Poultry - TurkeysSize/Capacity
◦Brooder: 0-5 lbs., 0.6-0.7 sf/bird◦Finish Light Birds: 20-25 lbs, 3.0-3.5
sf./bird◦Finish Heavy Birds: 30-40 lbs, 3.5+
sf/birdConstruction and DesignRCNs
◦Brooders: $13.00-18.00/sf.◦Finishers: $9.00-13.00/sf.
Poultry - TurkeysFunctional Depreciation Issues
◦Brooder space vs. finish space◦Brooders turn every 4.5-5.5 weeks vs.
finishers turn every 15-19 weeks◦Brooding and finishing on same site
External Depreciation Issues◦Long-term grower contract available?◦Location to nearest packing plant◦Location relative to neighboring
buildings and livestock facilities (bio-security)
Other Considerations
Some buildings don’t contribute any significant value (corn cribs, old barns, etc.)
PermitsWind TurbinesUnderground Storage TanksBio-security issues relating to
location of livestock facilities
Objectives ReviewedUnderstanding the inspection
processTypes of data to be collected
during the inspection processAbility to describe the physical
characteristics of the improvements
Ability to identify functional and external depreciation issues
Identify factors used to estimate RCNs
Conclusions and Wrap Up
Questions regarding inspectionsQuestions regarding appraisal
professionAppraiser Gift Bag