Motorsports FacilityValuation Issues

Fitzhugh L. Stout, MAISenior Managing Director

Integra Realty Resources - Charlotte

Douglas L. Nickel, MAISenior Managing Director

Integra Realty Resources – Wilmington, DE

A Brief History• November 2, 1895 – First American Automobile Race

– Exhibition race between Chicago & Waukegan and back– 92 miles– $500 prize (roughly $14,000 today)– Winner completed the race in 8 hours and 44 minutes– Average speed: 10.5 miles per hour!

• First Indianapolis Race– May 29, 1910– 200 miles– Average speed 72 miles per hour

• 2013 Indy 500– Average speed 167.734 miles per hour– Winner purse $2,353,355

Types of Motorsports Facilities• Oval Track

• Drag Strips

• Road Courses

How Did All This Get Started?

Oval Track• Typically ½ mile to 2 mile oval or

“oval” shaped• Dirt (smaller facilities) or

Asphalt/Concrete paving• Stadium style setting• Counterclockwise (Left hand turns

only)• Some include infield road courses

(Daytona, Indy)• Multi-vehicle competition• Larger facilities

– Located in mass media markets– Sanctioned events (NASCAR,

IRL/CART)– Typically televised events

Drag Strips

• ½ mile to 1 mile• Two competing lanes• Grandstands flanking both

sides of the starting lanes• Head to head competition• Located in mass media and

smaller markets• Upper tier events

sponsored by NHRA

Road Courses• 1 to 4 miles in length• High and low speed left and

right turns• Test amateur and professional

racer’s skills• Clockwise direction

(consistent with European standards)

• Outskirts of major market areas or remote market areas

• Few sanctioned events, mostly club-style events (SCCA, NASA, AMA, enthusiast/brand organizations)

• Limited grandstands and spectator areas

NASCAR & It’s Impact

• Background• History of NASCAR

(National Association for Stock Car Auto Racing)• What makes NASCAR Unique• NASCAR Track Types• NASCAR Racing Series• Components of Value• Evidence of Race Date Value• Evidence of Superadequacy• Valuation Process

History of NASCAR

• 1920-1933 Prohibition/Bootlegging• 1947-1950 NASCAR Founded• 1954-1959 First New Speedway• 1960-1970 Richard Petty Wins First Winston

Cup Championship• 1980-1989 Fortune 500 Sponsorship Begins• 1990-2000 NASCAR Reaches New Fans• 2000-2010 The New Millennium

What Makes NASCAR Unique

• NASCAR is privately held• NASCAR sanctions races on an annual basis

NASCAR Track Types

NASCAR Track Types

Short Length Short Track Bristol Motor SpeedwayIntermediate Length Intermediate Track Atlanta Motor SpeedwaySuper Speedway A racetrack that is greater than 2 miles in

length.Daytona Motor Speedway

Road Course A racing circuit comprised of left- and right-hand turns, as opposed to an oval which is comprised exclusively of left-hand turns.

Watkins Glen

Source: http://www.nascar.com/races/tracks/

Bristol Motor Speedway

Atlanta Motor Speedway

Daytona International Motor Speedway

Indianapolis Speedway

Watkins Glen International

Competitive NASCAR TracksSprint Cup Tracks

Shape Track NameLength (Miles) Shape Seats Type

Atlanta 1.54 Quad-Oval 124,000 INTAtlanta Motor SpeedwayBristol 0.533 Oval 160,000 SHBristol Motor SpeedwayCharlotte 1.5 Quad-Oval 165,000 INTLowe's Motor SpeedwayChicagoland 1.5 D-shaped Oval 75,000 INTChicagoland SpeedwayDarlington 1.366 Oval 63,000 INTDarlington RacewayDaytona Beach 2.5 Tri-Oval 168,000 SSDaytona Int'l SpeedwayDover 1 Oval 140,000 SHDover Int'l SpeedwayFontana 2 D-shaped Oval 92,000 SSAuto Club SpeedwayHomestead 1.5 Oval 65,000 INTHomestead-Miami SpeedwayIndianapolis 2.5 Oval 250,000 SSIndianapolis Motor SpeedwayKansas City 1.5 D-shaped Oval 81,687 INTKansas SpeedwayKentucky 1.5 D-shaped Oval 66,089 INTKentucky SpeedwayLas Vegas 1.5 D-shaped Oval 137,000 INTLas Vegas Motor SpeedwayMansfield 0.5 Oval 25,000 SHMansfield Motorsports Speedway

Competitive NASCAR TracksMartinsvil le 0.526 Oval 65,000 SHMartinsvil le SpeedwayMichigan 2 D-shaped Oval 137,243 SSMichigan Int'l SpeedwayMontreal 2.71 Road Course RCCircuit Gil les Vil leneuveNew Hampshire 1.058 Oval 91,000 INTNew Hampshire Motor SpeedwayPhoenix 1 Tri-Oval 76,800 SHPhoenix Int'l RacewayPocono 2.5 Tri-Oval 76,812 SSPocono RacewayRichmond 0.75 D-shaped Oval 112,029 SHRichmond Int'l RacewaySonoma 1.99 Road Course RCInfineon RacewayTalladega 2.66 Tri-Oval 143,231 SSTalladega SuperspeedwayTexas 1.5 Quad-Oval 159,585 INTTexas Motor SpeedwayWatkins Glen 2.45 Road Course RCWatkins Glen International

Note: Seating capacity in this table results from the source and is not accurate with regards to the subject property.

Source: http://www.nascar.com/races/tracks/

Competitive Local TracksState Race TracksName Location Type441 Speedway Dublin, GA 3/8 mile dirt trackAlbany Motor Speedway Albany, GA 1/4 mile asphalt ovalAtlanta Dragway Commerce, GA 1/4 mile asphalt drag stripAtlanta Motor Speedway Hampton, GA 1.5 mile superspeedway, 1/4 mile thunderingBil l Thomas Raceway Cumming, GA 1/20 mile concrete ovalBoyd's Speedway Ringgold, GA 1/3 mile clay ovalBrainerd Optimist Drag strip Ringgold, GA 1/8 mile asphalt drag stripCochran Motor Speedway Cochran, GA 1/2 mile dirt trackCoweta Raceway Newnan, GA 1/4 mile dirt trackDawgwood Speedway Chatsworth, GA 1/5 mile Clay OvalDixie Speedway Woodstock. GA 3/8 mile clay ovalDouglas Motorsports Dragway Nicholls, GA 1/4 mile asphalt drag stripEcheconnee Motocross Park Lizella, GA Dirt motocross track on 160 acresGeorgia Karting Komplex Carnesvil le, GA 1/4 mile clay ovalGordon Park Speedway Grovetown, GA 4/10 mile clay ovalGresham Motorsports Park Jefferson, GA 1/2 mile asphalt ovalHartwell Speedway Hartwell, GA 3/8 mile clay ovalHeadhunter Motor Club Dragway Eatonton, GA 1/8 mile asphalt drag stripHinesvil le Raceway Park Hinesvil le, GA 1/8 mile asphalt drag stripLagrange-Troup County Dragway LaGrange, GA 1/8 mile concrete drag stripLanier National Speedway Braselton, GA 3/8 mile asphalt ovalLaurens County Speedway Dexter, GA 1/5 mile dirt trackLavonia Speedway Lavonia, GA 3/8 mil clay ovalMacon National Dragway Danvil le, GA 1/8 mile concrete drag stripMetro Atlanta QMA Speedway Powder Springs, GA 1/20 mile asphalt ovalMiddle Georgia Kart Track Dublin, GA 6/10 mile kart track and motocross trackNeedmore Speedway Norman Park, GA 3/8 mile dirt oval

Competitive Local TracksNew Senoia Raceway Senoia, GA 3/8 mile dirt ovalNorth Georgia Speedway Chatsworth, GA 1/3 mile clay ovalOglethorpe Speedway Park Pooler, GA 5/8 mile clay ovalParadise drag strip Calhoun, GA 1/8 mile asphalt drag stripPineora Kartway Pineora, GA 1/4 mile dirt kart trackRoad Atlanta Braselton, GA 2.54 mile asphalt road courseRoebling Road Raceway Bloomingdale, GA 2.02 asphalt road courseRome Speedway Rome, GA 1/2 mile clay ovalSavannah Dragway Sylvania, GA 1/8 mile concrete drag stripScreven Motor Speedway Sylvania, GA 3/8 mile clay ovalSilver Dollar Raceway Reynolds, GA 1/4 mile asphalt drag stripSouth Georgia Motorsports Park Cecil GA 1/4 mile asphalt drag strip and 1/2 mile D-shaped asphalt ovalSouthern Dragway Nicholls, GA 1/8 mile asphalt drag stripSouthern Outlaw Speedway Bryon, GA Dirt kart, mower, cooler & ATV race trackSugar Creek Raceway Blue Ridge, GA 3/8 mile clay ovalSwainsboro Raceway Swainsboro, GA 1/2 mile dirt ovalToccoa Speedway Toccoa, GA 5/16 mile clay ovalUS 19 Dragway Albany, GA 1/8 mile asphalt drag stripValdosta Motor Speedway Valdosta, GA 3/8 mile clay ovalWatermelon Capital Speedway Cordele, GA 3/8 mile asphalt ovalWaycross Motor Speedway Waycross, GA 1/2 mile clay ovalWest Georgia Motor Speedway Whitesboro, GA 3/8 mile clay ovalWinder-Barrow Speedway Winder, GA 1/4 mile dirt ovalNote: Subject in bold

Source: http://www.racingin.com/track/georgia.aspx

DEFUNCT NASCAR TRACKS

NASCAR Track Issues

Decline in Industry IncomeIndustry Decline in Income (in thousands)

Years Ending December 31 2012 2011 2010 2009 2008 2007 SMI Historic Income N/A $320,451 $323,521 $376,719 $442,834 $419,116

Annual Decline -0.9% -14.1% -14.9% 5.7% N/A

Total Change (2007 to 2011) -23.5%

ISC Historic Income $387,932 $398,903 $415,708 $474,327 $570,584 N/AAnnual Decline -2.8% -4.0% -12.4% -16.9% N/A

Total Change (2008 to 2012) -32.0%

DMI Historic Income $24,092 $27,972 $36,358 $56,747 $58,780 N/A

Annual Decline -13.9% -23.1% -35.9% -3.5% N/A

Total Change (2008 to 2012) -59.0%

Combined Historic Income N/A $747,326 $775,587 $907,793 $1,072,198 N/A

Annual Decline -3.6% -14.6% -15.3%Total Change (2008 to 2011) -30.3%

Note: Preceding does not include broadcast revenue which has been added in below

Combined Income including Broadcast Revenue

N/A $1,187,400 $1,202,444 $1,306,954 $1,482,526 N/A

Annual Decline -1.3% -8.0% -11.8% N/A

Total Change (2008 to 2011) -19.9%

Historic Attendance

Historic Attendance 2012 2011 2010 2009 2008 2007 2006 2005 2004NASCAR

NASCAR Race Attendance 122,255 135,504 230,822 237,781 235,114 285,503 325,655 354,711 357,458Annual Change -9.78% -41.30% -2.93% 1.13% -17.65% -12.33% -8.19% -0.77% N/AChange from 2004 to 2010 -35.43%Change from 2004 to 2012 -65.80%

Source: Atlanta Motor Speedway

Note: One of two Sprint Cup race dates moved in 2011

EVIDENCE OF RACE DATE VALUE

EVIDENCE OF SUPER ADEQUACY

Cost Approach

• Physical Obsolescence• Functional Obsolescence• External Obsolescence

Sales Comparison ApproachSummary of Comparable Improved Sales

No. Name/Address

SaleDate;Status

Acres;

Oval Track Length Prop Rights

Effective Real Estate Sale Price # of Seats $/Seat

1 North Carolina Motor Speedway Oct-07 244.24 – $4,400,000 60,113 $73.20

US Highway 1 North and North NC Hwy 177

Closed – –

Rockingham 1.017 Fee SimpleRichmond CountyNC

2 Pikes Peak Int. Raceway Oct-05 1147.69 – $10,330,000 43,400 $238.0216650 Midway Ranch Rd. Closed – –Fountain 1.0 Fee SimpleEl Paso CountyCO

3 Martinsville Speedway Jul-04 250.00 – $4,300,000 65,000 $66.15340 Speedway Rd. Closed – –Ridgeway Fee SimpleHenry County 0.526VA

4 USA International Speedway May-07 104.55 – $6,200,000 11,000 $563.64

3401 Old Polk City Rd. Closed – –Lakeland 0.75 Fee SimplePolk CountyFL

5 New Hampshire Int'l Speedway Jan-08 1174.84 – $38,700,000 95,561 $404.98

N.H. Route 106 Closed – –Loudon 1.058 Fee SimpleMerrimack CountyNH

6 Moroso Motorsports Park Apr-08 187.00 – $7,500,000 11,000 $681.8217047 Bee Line Hwy. Closed – –Jupiter 2.25 Fee SimplePalm Beach CountyFL

7 Memphis Motorsports Park Jan-11 342.00 – $2,062,500 25,000 $82.50

5500 Victory Ln. Closed – –Millington 0.75 Fee SimpleShelby CountyTN

8 Kentucky Speedway May-08 848.00 – $62,550,000 68,089 $918.651 Speedway Dr. Closed – –Sparta 1.5 Fee SimpleGallatin CountyKY

Income Capitalization Approach

Three direct capitalization methods:

• Traxprofile Survey Method• Standard Going Concern Method• Non-NASCAR Analysis.

Subject Data Available

• Detailed Income and Expense Information

• Utilization Rates

• Separate NASCAR Event vs. non-NASCAR Event revenue and income

Capitalization Rate SelectionIbbotson Build-Up Method

Real Estate

Operators

Racing, including

Track Operations

20-Yr Tr. Yield 2.6700% 2.6700%S&P Equity Risk Premium 6.6200% 6.6200%Industry Risk Premium 0.2100% -1.0400%Small Cap Size 6.1000% 6.1000%Company Specific Premium 2.0000% 2.0000%Indicated Equity Yield 17.6000% 16.3500%

Equity Investment 40.000% X 17.60% = 7.0400% 40.00% X 16.35% = 6.5400%Debt Investment 60.00% X 9.31% 5.5865% 60.00% X 9.31% 5.5865%Weighted Average Cost of Capital 12.6265% 12.1265%

Less Growth -2.0000% -2.0000%Indicated Capitalization Rate 10.6265% 10.1265%

Weighting Cap Rate

Real Estate Operators 30.00% X 10.63% = 3.1879%Racing, including Track Operations 70.00% X 10.13% = 7.0885%

10.2765%1.6131%

11.8896%

Source: Ibbotson SBBS Valuation Yearbook 2012

Capitalization Rate:Real Estate Tax Rate Applicable:

Tax Loaded Capitalizatin Rate:

TraxProfile Survey MethodTraxprofile General Admissions Example Planned Events 35Complete Rainouts (Region 3) 18.1% Cap Rate: 10.2765%Revenue Events 28.665 6.335 Tax Rate: 1.6131%Rounded 29 Combined Rate 11.8896%Average Attendance per Event 5,000 Average Price Per Ticket $8.00General Admissions Revenue $1,160,000 42%Total Revenue $2,761,905 Value: $5,500,000Back Gate (Pit Admissions) 25% $690,476Food and Beverage 21% $580,000Other Income 12% $331,429Overall General Expenses 79% $2,181,905Net Revenue from Events $580,000

ExpensesAdvertising 2.5% $69,048Food 6.0% $165,714Insurance 4.0% $110,476Payroll 7.0% $193,333Purse 49.5% $1,367,143Rent 7.0% $193,333Other cost of sales 3.0% $82,857

79.0% $2,181,905Gross Profit $580,000

Track RentalsDays 100.00 Average Rental Rate per Day $2,500Total Track Rental Income $250,000Total Income $830,000Business Profit 20% $166,000Miscellaneous $10,000Total Other Deductions $176,000Estimated Net Income to the RE $654,000

GOING CONCERN METHOD

MODIFIED GOING CONCERN METHOD

VS.

Revenues• Oval Tracks

– Ticket sales/gate receipts– Sanctioning fees– Daily usage fees (track rental for practice/testing)– Advertising/sponsorships– Television fees– Concessions

• Dragstrips– Ticket sales/gate receipts– Sanctioning fees– Advertising/sponsorship– Television fees– Concessions

• Road Courses– Daily usage fees (track rental)– Program fees– Advertising/sponsorship– Concessions/gasoline sales– Gate receipts

Road Course Revenues

• Track Rental– Weather/Climate Based– Utilization

• Generally all weekend days (Saturday & Sunday)– 80% - 100% used

• Most Fridays– 65% - 80%

• Some weekdays (M-Th)– 10% - 35%

Name/Location Weekend WeekdayNelson LedgesSouthington, OH

2.00 1 Regional 30 60.48% $4,000 - $5,250 $2,800 Utilization impacted by pending sale rumors at the close of the prior season.

BeaveRun Motorsports ComplexWampum, PA

1.60 1 National 32 50.00% $5,950 $3,500 - $4,500 Opened Spring 2002. Includes 0.82 mile Wilson Circuit karting track. Planned 2.2 mile "South Course" yet to be constructed.

GingerMan RacewaySouth Haven, MI

1.88 1 National 29 50.74% $5,000 $3,000 - $4,000 Opened in 1996. Utilization rate does not include evening test sessions which start at 5:30pm for 61 days of the season.

Watkins Glen InternationalWatkins Glen, NY

3.45 1 National 26 100.00% $11,500 $8,000 Current course opened in 1957.

Putnam ParkGreencastle, IA

1.77 1 None 33 34.63% $3,850 - $6,500 $3,800 - $6,300 Opened late-1991. Utilization rate does not include personal test days used by the owner.

Virginia International RacewayAlton, VA

3.27 2 National 45 93.33% $11,500 $8,600 Originally operated from 1957-1974; Re-opened during Spring 2002.

Summit Point RacewaySummit Point, WV

2.25, 2.20 & 1.90 3 National 49 70.85% $3,850 - $6,500 $3,800 - $6,300 Originally opened during the mid-1960's. Jefferson Circuit added during the mid 1990's. Shenandoah Circuit added 2003.

New Jersey Motorsports ParkMillvi l le, NJ

2.25 & 1.90 2 Regional 36 63.89% $13,500 $8,000 Opened Summer 2008.

Mid-Ohio Sports Car CourseLexington, OH

2.40 1 National 32 77.23% $12,000 - $15,000 $9,500 Opened 1962; substantially upgraded mid-1980's. Track surface repaved 2006.

Track Rental Per DayOverall

Utilization Rate

Annual Operating

Weeks

COMPETITIVE PEER GROUPRoad Racing Facilities

No. of Courses

Road Course Distance (Miles) Comments

SCCA Racing

Expenses• Fixed

– Real Estate Taxes– Insurance

• Variable– Payroll– Racetrack Operations– Repairs & Maintenance– Utilities– Food service/concessions– Fuel– Administrative

• Reserves!

Case Study 1HISTORIC REVENUE AND EXPENSES

Road Course #1

2007 2008 Amount $/DU % of Rev. Amount $/DU % of Rev. Amount $/DU % of Rev. Amount $/DU % of Rev.RevenueTrack Rental $1,573,312 $9,094 18.18% $1,044,465 $6,037 13.18% $1,121,344 $6,482 15.08% $1,121,300 $6,482 15.30%Other Rental $398,901 $2,306 4.61% $322,085 $1,862 4.06% $240,016 $1,387 3.23% $252,950 $1,462 3.45%Program $947,948 $5,479 10.95% $995,511 $5,754 12.56% $1,083,478 $6,263 14.57% $1,248,395 $7,216 17.03%Food Service $893,450 $5,164 10.32% $897,286 $5,187 11.32% $683,741 $3,952 9.19% $683,000 $3,948 9.32%Gate Receipts $1,672,264 $9,666 19.32% $1,709,594 $9,882 21.57% $1,561,391 $9,025 21.00% $1,510,548 $8,731 20.61%Other Services $140,000 $809 1.62% $128,333 $742 1.62% $96,884 $560 1.30% $150 $1 0.00%Fuel Sales $194,640 $1,125 2.25% $202,405 $1,170 2.55% $170,123 $983 2.29% $169,900 $982 2.32%Other Sales $2,199,160 $12,712 25.41% $2,066,544 $11,945 26.07% $1,977,705 $11,432 26.59% $1,855,448 $10,725 25.31%Advertising Revenues $460,120 $2,660 5.32% $460,134 $2,660 5.80% $436,518 $2,523 5.87% $427,250 $2,470 5.83%Miscellaneous $173,621 $1,004 2.01% $100,406 $580 1.27% $65,371 $378 0.88% $60,550 $350 0.83%Total Revenue $8,653,417 $50,020 100.00% $7,926,762 $45,819 100.00% $7,436,570 $42,986 100.00% $7,329,491 $42,367 100.00%ExpensesReal Estate Taxes $104,027 $601 1.20% $32,084 $185 0.40% $64,080 $370 0.86% $64,500 $373 0.88%Insurance $167,353 $967 1.93% $153,214 $886 1.93% $145,053 $838 1.95% $141,500 $818 1.93%Payroll $1,940,714 $11,218 22.43% $1,679,229 $9,707 21.18% $1,471,904 $8,508 19.79% $1,535,069 $8,873 20.94%Racetrack $3,737,079 $21,602 43.19% $3,745,035 $21,648 47.25% $3,422,945 $19,786 46.03% $3,414,250 $19,736 46.58%Administrative $775,072 $4,480 8.96% $645,215 $3,730 8.14% $493,373 $2,852 6.63% $520,336 $3,008 7.10%Food Service Expense $369,801 $2,138 4.27% $372,039 $2,151 4.69% $245,065 $1,417 3.30% $232,468 $1,344 3.17%Fuel Expense $138,011 $798 1.59% $168,058 $971 2.12% $148,828 $860 2.00% $149,486 $864 2.04%Repairs & Maintenance $312,218 $1,805 3.61% $328,334 $1,898 4.14% $220,192 $1,273 2.96% $264,360 $1,528 3.61%Miscellaneous $195,282 $1,129 2.26% $44,825 $259 0.57% $21,894 $127 0.29% $9,700 $56 0.13%Utilities $73,152 $423 0.85% $69,572 $402 0.88% $86,262 $499 1.16% $90,000 $520 1.23%Replacement Reserves $0 $0 0.00% $0 $0 0.00% $0 $0 0.00% $0 $0 0.00%Total Expenses $7,812,709 $45,160 90.28% $7,237,604 $41,836 91.31% $6,319,597 $36,529 84.98% $6,421,669 $37,119 87.61%Net Operating Income $840,707 $4,860 9.72% $689,159 $3,984 8.69% $1,116,973 $6,456 15.02% $907,822 $5,248 12.39%

2009 2010 Budget

Case Study 2HISTORIC REVENUE AND EXPENSES

Road Course #2

2006 2007 Amount $/DU % of Rev. Amount $/DU % of Rev. Amount $/DU % of Rev. Amount $/DU % of Rev.RevenueTrack Rental $766,274 $4,881 51.73% $645,842 $4,485 36.37% $426,188 $3,772 33.43% $500,641 $4,470 34.87%Other Rental $142,594 $908 9.63% $215,531 $1,497 12.14% $58,357 $516 4.58% $100,193 $895 6.98%Program $212,590 $1,354 14.35% $303,013 $2,104 17.06% $403,817 $3,574 31.68% $442,656 $3,952 30.83%Food Service $7,318 $47 0.49% $81,931 $569 4.61% $33,969 $301 2.66% $83,327 $744 5.80%Gate Receipts $24,010 $153 1.62% $28,637 $199 1.61% $0 $0 0.00% $38,384 $343 2.67%Other Services $145,797 $929 9.84% $156,656 $1,088 8.82% $139,717 $1,236 10.96% $112,392 $1,004 7.83%Fuel Sales $60,287 $384 4.07% $68,830 $478 3.88% $61,304 $543 4.81% $54,324 $485 3.78%Other Sales $95,945 $611 6.48% $139,465 $969 7.85% $142,375 $1,260 11.17% $23,515 $210 1.64%Advertising Revenues $19,084 $122 1.29% $15,125 $105 0.85% ($2,125) ($19) -0.17% $7,242 $65 0.50%Miscellaneous $7,301 $47 0.49% $120,958 $840 6.81% $11,131 $99 0.87% $72,890 $651 5.08%Total Revenue $1,481,199 $9,434 100.00% $1,775,988 $12,333 100.00% $1,274,731 $11,281 100.00% $1,435,566 $12,818 100.00%ExpensesReal Estate Taxes $128,295 $817 8.66% $83,994 $583 4.73% $131,915 $1,167 10.35% $159,133 $1,421 11.09%Insurance $104,088 $663 7.03% $64,424 $447 3.63% $76,466 $677 6.00% $77,528 $692 5.40%Payroll $370,263 $2,358 25.00% $468,355 $3,252 26.37% $503,117 $4,452 39.47% $620,563 $5,541 43.23%Racetrack $322,518 $2,054 21.77% $377,281 $2,620 21.24% $210,956 $1,867 16.55% $245,644 $2,193 17.11%Administrative $148,133 $944 10.00% $89,928 $625 5.06% $80,449 $712 6.31% $34,979 $312 2.44%Food Service Expense $6,135 $39 0.41% $72,157 $501 4.06% $33,368 $295 2.62% $52,109 $465 3.63%Fuel Expense $55,017 $350 3.71% $70,181 $487 3.95% $66,784 $591 5.24% $64,219 $573 4.47%Repairs & Maintenance $10,343 $66 0.70% $3,536 $25 0.20% $13,074 $116 1.03% $62,337 $557 4.34%Miscellaneous $12,525 $80 0.85% $11,200 $78 0.63% $11,400 $101 0.89% $115,968 $1,035 8.08%Utilities $57,180 $364 3.86% $63,908 $444 3.60% $48,325 $428 3.79% $57,045 $509 3.97%Replacement Reserves $0 $0 0.00% $0 $0 0.00% $0 $0 0.00% $0 $0 0.00%Total Expenses $1,214,498 $7,736 81.99% $1,304,964 $9,062 73.48% $1,175,856 $10,406 92.24% $1,489,525 $13,299 103.76%Net Operating Income $266,701 $1,699 18.01% $471,024 $3,271 26.52% $98,876 $875 7.76% ($53,960) ($482) -3.76%

2008 2009 Annualized

Case Study 3HISTORIC REVENUE AND EXPENSES

Road Course #3

2005 2006 2007 Amount $/DU % of Rev. Amount $/DU % of Rev. Amount $/DU % of Rev.RevenueTrack Rental $2,500,236 $3,677 60.72% $3,236,822 $4,410 61.02% $2,943,350 $3,823 54.42%Buildng Rental - Gasoline Alley $87,437 $129 2.12% $186,640 $254 3.52% $213,950 $278 3.96%Rentals - Merchandise Store $36,000 $53 0.87% $38,000 $52 0.72% $36,000 $47 0.67%Rentals - Other $361,201 $531 8.77% $443,451 $604 8.36% $644,477 $837 11.92%Concessions Income $222,880 $328 5.41% $245,414 $334 4.63% $313,061 $407 5.79%Gasoline Sales $185,655 $273 4.51% $215,032 $293 4.05% $277,973 $361 5.14%Gate Receipts $210,670 $310 5.12% $270,693 $369 5.10% $203,421 $264 3.76%Entry Fees $240,926 $354 5.85% $252,562 $344 4.76% $270,579 $351 5.00%Miscellaneous $272,981 $401 6.63% $415,653 $566 7.84% $505,925 $657 9.35%Total Revenue $4,117,986 $6,056 100.00% $5,304,267 $7,227 100.00% $5,408,736 $7,024 100.00%

ExpensesReal Estate Taxes $22,217 $33 0.54% $22,770 $31 0.43% $35,093 $46 0.65%Insurance $61,938 $91 1.50% $83,297 $113 1.57% $67,569 $88 1.25%Payroll $608,960 $896 14.79% $504,675 $688 9.51% $939,061 $1,220 17.36%Racetrack $167,109 $246 4.06% $178,632 $243 3.37% $226,245 $294 4.18%Administrative $224,092 $330 5.44% $248,121 $338 4.68% $180,553 $234 3.34%Concession Expense $10,000 $15 0.24% $4,789 $7 0.09% $2,693 $3 0.05%Other Taxes $92,390 $136 2.24% $115,168 $157 2.17% $149,338 $194 2.76%Repairs and Maintenance $428,712 $630 10.41% $396,403 $540 7.47% $704,105 $914 13.02%Miscellaneous $33,142 $49 0.80% $66,500 $91 1.25% $103,293 $134 1.91%Utilities $69,002 $101 1.68% $85,109 $116 1.60% $100,169 $130 1.85%Replacement Reserves $0 $0 0.00% $0 $0 0.00% $0 $0 0.00%Total Expenses $1,717,562 $2,526 41.71% $1,705,464 $2,324 32.15% $2,508,119 $3,257 46.37%Net Operating Income $2,400,424 $3,530 58.29% $3,598,803 $4,903 67.85% $2,900,617 $3,767 53.63%

Capitalization Rate• Good question!• Property desirability?

Investor Surveys

Band of Investment

BAND OF INVESTMENT METHODMORTGAGE / EQUITY ASSUMPTIONSLoan To Value Ratio 65%Interest Rate 8.50%Amortization (Years) 20Mortgage Constant 0.1041Equity Ratio 35%Equity Dividend Rate 15.00%

WEIGHTED AVERAGE OF MORTGAGE AND EQUITY REQUIREMENTS

Mortgage Requirement 65% x 10.41% = 6.77%Equity Requirement 35% x 15.00% = 5.25%

Indicated Capitalization Rate 12.02%Rounded 12.00%

Sources

Financials for corporations – www.morningstar.comLatest NASCAR information – www.NASCAR.COM ,

http://www.new2nascar.com/history.htm, and http://nascarnation.us/page/a-brief-history-of-nascar.

Individual track information – www.trackname.com or Google track name

Articles on track valuation – www.ai.com (Lum Library)Information on development of capitalization rates for race

industry - Ibbotson SBBS Valuation Yearbook 2012 or www.morningstar.com

Rates of Return – www.realtyrates.com

Open Discussion