HomeMy WebLinkAbout2002-03-12 - AGENDA REPORTS - METROLINK PROPERTY ACQUISITION (2)CITY OF SANTA CLARITA
AGENDA REPORT
PUBLIC HEARING City Manager Approval:
Item to be presented by: Christopher Price
DATE: March 12, 2002
SUBJECT: JAN HEIDT METROLINK STATION IN NEWHALL PARKING LOT
EXPANSION, PROJECT NO. F2002 — PROPERTY ACQUISITION
DEPARTMENT: Transportation & Engineering Services
RECOMMENDED ACTION
1) City Council conduct a public hearing, receive the staff report, and review the evidence
presented at the public hearing, including public comment and any written comments
received.
2) Adopt a resolution authorizing the condemnation proceedings necessary for parking
expansion at the Jan Heidt Metrolink Station in Newhall, CIP Project No. F2002.
3) Approve the increase in revenues for STPL Fund 103 by $294,177.00, and appropriate this
amount from the Transit Fund to Account No. F2002103-8001.
4) Authorize the City Attorney to amend the City's March 10, 1999 Eminent Domain
Compliant regarding the subject property and deposit an additional $1,815,100.00 with
Los Angeles Superior Court to initiate immediate taking proceedings.
5) Authorize the City Manager or designee to execute all documents, subject to City Attorney
approval.
6) Direct staff to continue to work with the property owner to reach a mutually beneficial
purchase agreement.
BACKGROUND
The Jan Heidt Metrolink Station in Newhall (Station) Parking Expansion Project encompasses
property acquisition, design, and construction of an additional 150 parking spaces for the
Station. When the Station was first built, various properties around the Station were acquired
to accommodate the amenities and parking necessary to satisfy Metrolink's parking
requirements and the public need. The Anawalt family owned three contiguous parcels
adjacent to the Station site totaling approximately 4.79 acres that included an established retail
business.
Prior to completion of the Station construction, a partial property acquisition was sought by the
City to acquire a portion of one property that was needed for commuter parking. At that time
the Anawalt property owners suggested that the City consider purchasing the balance of their
property concurrently. The City did not elect to pursue the purchase of the entire property, as
the monetary resources did not exist to complete such a purchase.
Agenda Items_
JAN HEIDT METROLINK STATION IN NEWHALL
PARKING LOT EXPANSION — PROPERTY ACQUISITION
March 12, 2002 — Page 2
In the time that has transpired since the City initiated a partial taking of the Anawalt property,
additional federal funding sources have become available that now allow the City to move
forward and acquire the remaining portion of this property. The availability of these grant
funds allowed staff to arrange for two independent appraisals in order to determine the
Fair -Market Valuation (FMV) of the subject property. The FMV of the subject property has
been determined to be $2,150,000.00.
At this time sufficient federal funds totaling $1,924,185.00 have been secured by the City for
property acquisition, tenant relocation, design, and parking expansion construction. Acquisition
of this property will be achieved through the use of Federal Transit Administration (FTA) and
STPL grant funds. FTA and STPL grant funds are allocated in a manner that allows the City
to recover 80 percent and 88.53 percent of all project related costs. The remaining funds needed
to support this project are comprised of local match funds provided by the City.
On February 22, 2002, the City prepared an offer letter to the current property owner
(Anawalt Lumber & Material Company) in the amount of $2,150,000.00 for the entire property
(three parcels, in fee simple estate). The actual outstanding balance due at this time is
$1,815,100.00. This amount is reflective of the appraised value of the property and represents
the balance owed by the City to the property owners. As the City Council may recall, the City
previously deposited $334,900.00 with the court on or about March 10, 1999, to satisfy the
partial property take required to complete the original construction of the Station.
The presented offer is subject to, and contingent upon, acceptable soil conditions of the property
and the absence from the property of toxic or hazardous substances, and any other kind of soil
or water contamination, delivery of a disclosure statement regarding such conditions, and a
grant of a right of entry to the City for the purpose of conducting a soils, toxic, and hazardous
substances investigation of the property and approval. This offer is subject to modification
depending on the results of such an investigation.
As staff has been unable to acquire fee ownership of this property through mutual agreement
with the owner, the City Council must now consider use of its condemnation powers. Staff is
confident that all due diligence tasks performed in connection with this project, including the
project study report and environmental certification, demonstrates that the Anawalt property
is the superior option to address the lack of available parking at the Station. If the City Council
agrees that public necessity supports the acquisition of the subject property, it would then be
appropriate for the City Council to adopt a resolution authorizing condemnation proceedings
for the purpose of acquiring a fee interest for the subject property.
Questions relating to value are not relevant to this proceeding. However, that does not mean
that negotiations for the acquisition of the subject property are at an end. If the City Council
should adopt the Resolution of Necessity, the City Attorney will initiate the necessary
condemnation action in Los Angeles Superior Court. This action would not prevent City staff
from continuing negotiation efforts with the property owner in the hope of reaching an
JAN HEIDT METROLINK STATION IN NEWHALL
PARKING LOT EXPANSION — PROPERTY ACQUISITION
March 12, 2002 — Page 3
agreement prior to trial, which is currently set for June 2002.
A Notice of Initial Study/Negative Declaration was prepared for the Station parking lot
expansion and was advertised in the Signal newspaper on February 28 and March 20, 2001,
and circulated for public comment.
ALTERNATIVE ACTIONS
1) Upon receipt of an accepted offer from the property owner on or prior to March 12, 2002, the
City Council may authorize the City Manager to execute the purchase of the subject
property located at 22427 Market Street, subject to City Attorney approval. A formal offer
to purchase the subject property was conveyed by the City on February 22, 2002. A copy
of the offer package is on file in the City Clerk's reading file.
2) Upon receipt of an accepted offer from the property owner on or prior to March 12, 2002, the
City Council may authorize the City Manager to provide a counteroffer to the owners of the
subject property.
3) Other action as determined by the City Council.
FISCAL IMPACT
This action will not have a significant effect on the actual cost of purchasing the property, as
the City is obligated to pay the FMV as determined through the appraisal process. The expense
of litigation to finalize the acquisition is unknown at this time. The FTA will reimburse
80 percent of all eligible FTA costs associated with the project, including those for land
acquisition. STPL will reimburse 88.53 percent of all eligible STPL costs associated with the
project, including tenant relocation, design, and parking expansion construction. The remaining
funds needed to support this project are comprised of local match funds provided by the City.
ATTACHMENTS
Exhibit "A" — Location Map
Resolution
Offer Letter with attached Legal Description and Appraisal Summary Statement (available in
the City Clerk's reading file)
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CITY OF SANTA CLARITA
NOTICE OF A PUBLIC HEARING TO CONSIDER TO
ADOPT A RESOLUTION OF NECESSITY FOR THE
ACQUISITION OF CERTAIN INTERESTS IN AND TO CERTAIN REAL PROPERTY
LOCATED IN THE CITY OF SANTA CLARITA,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA
(22427 MARKET STREET, APN NOS. 2811-011-039, 2831-011-040, 2833-014-013)
YOU ARE HEREBY NOTIFIED, pursuant to Code of Civil Procedure Section
1230.010 et. Seq., that the City Council of the City of Santa Clarita intends to consider the
adoption of a Resolution of Necessity for acquisition by eminent domain of fee ownership of
certain real property ("Property"), for expansion of parking for the Jan Heidt Metrolink
Station in Newhall purposes and all uses appurtenant thereto, as described and depicted on
Exhibits "A" and "B." The project for which the acquisition of the interest so stated hereon
is the expansion of parking for the Jan Heidt Metrolink Station in Newhall
The hearing will be held on March 12, 2002, at 6:00 p.m., or as soon thereafter as the
City Council can hear said matter, at the Council Chambers, located at 23920 Valencia
Boulevard, Suite 105, Santa Clarita, California 91355.
Any persons claiming or having an interest in and to the interests, are hereby
notified that you have the right to appear and be heard on the issues to be considered at
that hearing.
If you wish to be heard at this hearing, you MUST FILE A WRITTEN REQUEST,
indicating your intent to appear and be heard, within fifteen (15) days of the first date of
publication of this notice, by filing or delivering that written request to the City Clerk,
23920 Valencia Boulevard, Suite 304, Santa Clarita, California 91355.
If you have any questions, please call James Tong at (661) 255-4366.
Dated: February 22, 2002
Sharon L. Dawson, CMC
City Clerk
Publish Date: February 25, 2002, February 28, 2002, and March 3, 2002
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EXHIBIT "A"
LEGAL DESCRIPTION
(APN 2831.011.039,2831.011-040,2833-014-013).
The land referred to in this appraisal is situated in the State of California, County of Los Angeles and is
legally described as follows:
Parcel 1:
That portion of block 26 of the town of Newhall, in the City of Santa Clarita, County of Los Angeles,
State of California, as per map recorded in book 53 pages 21 and 22 of miscellaneous records, in the office
of the County Recorder of said County, together with those portions of Pine Street, the alley through said
block 26 and Arch Street, all now vacated, described as a whole as follows:
Beginning at the intersection of the southwesterly line of said Pine Stieet with the southwesterly
prolongation of the 'southeasterly line of lot 16 of said block 26; thence northeasterly along said
prolongation, said southeasterly line and its northeasterly prolongation to the southeasterly line of lot 17
and its northeasterly prolongation to the center line of said Arch Street; thence northwesterly along said
center line to the northeasterly prolongation of the northwesterly line of the southeasterly half of lot 19 in
said block 26; thence southwesterly along said last mentioned prolongation, said northwesterly line and its
southwesterly prolongation, to and along the northwesterly line of the southeasterly half of lot 14 in said
block 26, and its southwesterly prolongation, to the southwesterly line said to be Pine Street, thence
southeasterly thereon to the point of beginning.
Parcel 2:
Block 17, and that part of block 26 of the Town of Newhall, in the City of Santa Clarita, in the County of
Los Angeles, State of California, as per map recorded in book 53 pages 21 and 22 of miscellaneous records
in the office of the County Recorder of said County, together with that part of Eighth Street lying
northeasterly of Pine Street; part of alley through said block 26; part of Arch Street and part of Pine Street,
all now vacated, described as a whole as follows:
Beginning at the intersection of the southwesterly line of said Pine Street, with the southwesterly
prolongation of the southeasterly line of the northwesterly half of lot 14 in said block 26; thence
northeasterly along said prolongation, said southeasterly line and its northeasterly prolongation to and
along the southeasterly line of the northwesterly half of lot 19 in said block 26, and its northeasterly
prolongation, to the center line of said Arch Street; thence northwesterly along said center line to the
northeasterly line of said northeasterly line to the northerly terminus of that certain course, shown on said
map as having a magnetic bearing of North 42' 34' east and a length'of 11 feet; thence southwesterly along
said "Certain Course" to said southwesterly line of Pine Street; thence southeasterly along said
southwesterly line to the point of beginning.
Parcel 3:
That portion of Lot 40 of St. John's Subdivision, being a portion of the Rancho San Francisco, in the
County of Los Angeles, State of California, as per map recorded in book 196, page 304 of miscellaneous
records, in the office of the County Recorder of said County, described as follows:
Beginning at the northerly terminus of that certain course shown as having a magnetic bearing of North 42°
34' east and a length of 11 feet, at the northwesterly end of Pine Street, on the map of Town of Newhall,
recorded in book 53 pages 21 and 22 of miscellaneous records of said county; thence northeasterly along
the northeasterly prolongation of said certain course (being also the southeasterly line of Lot 194 of tract
No. 1078 as per map recorded in book 18 page 69 of maps in the Recorder's office) a distance of 89.00
feet; thence southeasterly in a direct line to a point in the northerly line of block 17 of said Town of
Newhall, distance easterly thereon 510.00 feet from the point of beginning; thence westerly along said
northerly line to the point of beginning.
Page 1
City of
Santa Clarita
23920 Valencia Blvd.
Suite 300
Santa Clariia
California 91355-2196
Website: www.santa-clarita.com.
February 22, 2002
Phone
(661) 259-2489
Fax
(661) 259-8125
CERTIFIED MAIL
Anawalt Lumber & Materials Company
11000 Burbank Boulevard
N. Hollywood, CA 91601
Subject APN 2811-011-039,2831-011-040,2833-014-013
22427 Market Street, Santa Clarita CA 91321
Dear Property Owner:
This letter is being forwarded to.you as the owner of the above property, located within the City of
Santa Clarita (hereinafter "City").
As you know, on or about January 12, 1999, the City adopted Resolution No. 99-17, which
authorized the City to bring an eminent domain action to condemn a portion of your property
located at 22427 Market Street, Newhall, California (the "Separate Parcel'D in conjunction with
the Newhall Metrolink Station (referenced as Exhibits A-1 and A-2 attached thereto). A
complaint in eminent domain was thereafter filed in regard to that Separate Parcel in the Los
Angeles Superior Court, Case. No. BC 206500 (the `Lawsuie ).
By this correspondence, in addition to the Separate Parcel condemned in the Lawsuit, the City
now hereby offers to purchase the balance of your property, i.e., the Anawalt Lumber Yard facility
located on the northwesterly side of Market Street, 185 -feet easterly from Railroad Avenue at
22427 Market Street, Santa Clarita (the "Remainder Parcel'D (the Separate Parcel and the
Remainder Parcel are collectively referred to herein as the "Property '�. This Property is sought
for expansion and construction of the Jan Heidt MTA Station. Attached hereto as Exhibit "A" is a
legal description of the Property.
The Property has been appraised by a professional real estate appraiser retained by the City.
Valuation of the Property was determined by the appraiser on October 24, 2001.
The highest and best use of the Property is defined as "that reasonably probable and legal use of
vacant land or an improved property, which is physically possible, appropriately supported,
financially feasible and produces maximum profitability". Based upon the foregoing, as well as
the current zoning ("CC—Community Commercial" uses, except the northwesterly 0.45 acres,
which is zoned "IC --Industrial Commerciar, the appraiser has determined that the highest and
best use of the Property is immediate development with commercial and light industrial
improvements.
The City is offering, subject to City Council approval, the full amount reflected in the appraisal as
the fair -market value for the Property. The basis for that determination as just compensation for
the Property is explained in the attached Appraisal Summary Statement as Exhibit `B."
The City is offering $1,815,100 for all interests it seeks to acquire in the Property. Said
amount consists of a total of $2,150,000.00, constituting the balance of just compensation for
the Property ($1,815,100) plus the amount of $334,900, which was deposited by the City with
the court on or about March 10, 1999 pursuant to Code of Civil Procedure § 1255.010(a),
and was ordered to be withdrawn by you on or about September 10, 1999.
PRINTED ON RECYCLED PAPER
Anawalt Lumber & Materials Company
February 22, 2002
Page 2
This offer is for title to the fee interest in the Property. Payment will be made when the title to the
Property vests in the City free and clear of all recorded or unrecorded liens, encumbrances,
assessments, leases and taxes, except:
1. Taxes for the year in which the Property is purchased, which shall be prorated to close of
escrow;
2 Covenants, conditions, restrictions and reservations of record that do not interfere with
the City's proposed use of the Property;
3. Easements or rights-of-way over the land for public or quasi -public utility or public street
purposes, if any; and
4. Any other interests in the Property or exceptions to title appearing on a preliminary title
report or litigation guarantee which are accepted by the City in writing through escrow.
The City will.pay all usual fees, charges and costs that arise out of this escrow.
This offer is subject to, and contingent upon, acceptable soil conditions of the Property and the
absence from the Property of toxic or hazardous substances and any other kind of soil or water
contamination, delivery of a disclosure statement regarding such conditions, and a grant of a right
of entry to the City for the purpose of conducting a soils, toxic and hazardous substances
investigation of the Property and approval. This offer is subject to modification depending on the
results of such an investigation.
Please be advised that the offer stated above presumes the Property is free of hazardous substances
(as that term is defined under California Health and Safety Code Section 33459(b)) and all other
subsurface soil contamination. In the event that any facts or circumstances arise which indicate
the presence of such subsurface contamination, the City reserves the right to rescind, or modify,
the offer stated above at any time prior to its written acceptance, to reflect the estimated or actual
costs to remediate the Property to the satisfaction and approval of all applicable regulatory
agencies. Further, in the event the City discovers such soil contamination after it acquires the
Property, the City reserves all rights and remedies it may have against you and all prior owners to
seek damages or other obligations the City incurs as a result of the contamination, as may be
permitted or authorized by any law, including but not limited to CERCLA (42 U.S.C. 19601 et
seq.), the Hazardous Waste Control Law (California Health and Safety Code ' ' 25100 et seq.),
the Porter Cologne Act (California Water Code ' ' 13000 et seq.), California Health and Safety
Code" ` 25280 et seq., 33459 et seq., and provisions of Proposition 65.
We understand that J.B. Wholesale Roofing holds a lease on the property, and that some of the
improvements for which compensation is being provided in this offer may belong to said lessee.
The compensation offered herein is offered to the owner and lessee as their interests may appear,
and payment is conditional upon either the owner and lessee agreeing to a distribution of the total
offered compensation, or the owner obtaining a release, quitclaim and/or assignment of the lease.
Any lessee interest in the property covered by this offer must be cleared before this acquisition can
be completed. Any costs associated with such clearance may be deductible from the amount of
compensation offered to you herein.
Anawalt Lumber & Materials Company
February 22, 2002
Page 3
If this offer is acceptable to you, please so indicate to the undersigned in writing. Upon your
acceptance, the City will prepare and forward to you an agreement. Upon receipt of a signed
agreement, the matter will be reviewed by the City Council, which has final ratification authority.
If for any reason you are not satisfied with this offer of just compensation and have relevant
information regarding the value of the Property that you would like the City to consider, it will be
happy to do so. In addition, you should be aware that in the event negotiations fail to result in an
agreement, and the City decides to proceed with the acquisition of the Property through eminent
domain, you have the right to have the amount of just compensation to by the City for the Property
fixed by a court of law. If you have any questions regarding this offer or have information
regarding the value of your property, please contact Barbara Stoll, Acquisition Specialist for the
City of Santa Clarita, at (661) 286.4046.
This summary of the basis of the amount offered as just compensation is presented in compliance
with federal and state laws and has been derived from a formal appraisal prepared by an
independent fee appraiser which includes supporting sales data and other documentation.
Approved for Acquisition,
Robert Newman
City Engineer
City of Santa Clarita
Date: 2 ZL Zd®Z
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Enclosures
cc: Kevin Brogan, Fill Farrer & Burrill, LLP
Bill Weldon, Consultant
Alan Sozio, Burke, Williams, and Sorensen
James Tong, Assistant Engineer
Barbara Stoll, Acquisition Specialist
Anawalt Lumber & Materials Company
February 22, 2002
Page 4
ACCEPTANCE
The foregoing offer of the City of Santa Clarita for the acquisition of the property described in
attached Exhibit "A" is hereby accepted:
Dated:
Dated:
EXHIBIT `B"
APPRAISAL SUMMARY STATEMENT
Project: expansion and construction of the Jan Heidt MTA Station
Location: Anawalt Lumber Yard facility located in the Newhall area of the City of Santa Clarim,
California, on the northwesterly side of Market Street, 185 -feet easterly from Railroad Avenue at
22427 Market Street, Santa Clarita, California 91321.
Assessor's Parcel Number: 2831-011-039,2831-011-040, 2833-014-013.
Date of Valuation: October 24, 2001
Owner: Anawalt Lumber & Material Company 11000 Burbank Blvd, North Hollywood Ca 91601
Property Address: 22427 Market Street, Santa Clarita, Ca 91321
Zone: CC Community Commercial/IC Industrial Commercial
Present Use: Commercial Retail
Highest and Best Use: Current Use, Developed with Commercial Improvements
Total Property Area: 4.79 Acres Total of 3 Parcels 2831-011-039, 2831-011-040, 2833014-013
Interest to be Acquired: Fee Simple Interest
Summary of Just Compensation:
Land and Improvements $2,150,000
Total Just Compensation $2,150,000*
The determination of market value of the property being acquired is based upon a market value appraisal
prepared in accordance with accepted appraisal procedures. The value of the property is based upon an
analysis of recent sales of comparable sites and similar properties in this locality with consideration of the
highest and best use for development of the property. *This offer of $2,150,000 reflects the total just
compensation of the fee simple estate of the three parcels, in total. The City is offering $1,815,100 as the
final payment, reflecting the balance now due, when added to the previously deposited sum of $334,900,
which totals $2,150,000. ($334,900 was deposited and ordered withdrawn on or about March 10, 1999 as
part of a partial acquisition).
FAIR -MARKET VALUE, as used in the appraisal, is "...the highest price on the date of valuation that
would be agreed to pay a seller, being willing to sell but under no particular or urgent necessity for doing
so, nor obligated to sell, an a buyer being ready, willing and able to buy but under no particular necessity
for doing so, each dealing with the other with full knowledge of all the uses and purposes for which the
property is'reasonably adaptable and available." (Code of Civil Procedure Section 1263.320)
Pursuant to State law, any decrease or increase in the value of the property to be acquired prior to the date
of valuation caused by the public improvements or project for which the property is to be acquired, or by
the likelihood that the property would be acquired, or by the likelihood that the property would be acquired
for such an improvement or project, other than that due to physical deterioration within the reasonable
control of the owner, has been disregarded by the appraiser in making the determination of the fair -market
value of the property.
Page 1
In reaching the conclusion on fair -market value, the appraiser has given full and careful consideration to the
highest and use for the property and to all features inherent in the property affecting its market value.
The cost approach, income capitalization approach and sales comparison approach were used as indications
of market value.
COST APPROACH The cost approach is developed by adding the estimated value of the land to the
current estimated cost to replace the improvements; and then subtracting accrued depreciation in the
improvements from all causes. This approach is also called the replacement cost approach.
Land Value Element
The estimated value of land was based on an analysis of 6 property sales. All six properties are commercial
or business park lots located in the City of Santa Clarim. They include: ,
SALE
LOCATION DATE
PRICE
SQ. FT.
$ PER
SQ. FT
1.
23800 San Fernando Rd; 2/8/00
$600,000
47,890
$12.53
Santa Clarita, CA
2.
17133 Sierra Hwy, 7/16/01
$400,000
104,540
$3.83
Santa Clarita, CA
78,408
$5.10
3.
18415 Sierra Hwy 8/30/01
$250,000
30,056
$8.32
Santa Clarita, CA
4.
23740 San Fernando Rd, 11/15/0.1
$1,650,000
182,516
$9.04
Santa Clarita, CA
5.
NEC Sierra Highway & Acpt'd offer
$550,000
93,220
$5.90
Scherzinger Lane,
Santa Clarita, CA
6.
SWC Golden Triangle & Listing
$2,331,000
194,278
$12.00
Ruether Ave,
Santa Clarita, CA
After review and analysis of each sale as it related to the subject, it wag concluded that the land unit value
of the subject is as follows:
208,652 square feet @ $8.75. (Rounded to Market Terms) = $1,825,000
Reconciliation of the Replacement Cost Aporoach
Improvement new including retail/industrial building and shed building, plus direct costs for site
improvements of $1,068,208, plus various indirect costs of $103,909, plus entrepreneur profit of
$117,212 = $1,289,329 (total cost new) minus depreciation of 75 percent or $928,317 provides a value of
the deprecated improvements of $361,012.
The value of the depreciated improvements of $361,012 plus the land value of $1,825,000 equals the total
value under the Replacement Cost Approach of $2,185,000.
Page 2
SALES COMPARISON APPROACH The sales comparison approach is used to derive a value
indication by comparing the property being appraised to similar properties that have sold recently, applying
appropriate units of comparison, and making adjustments to the comparables based on the elements of
comparison. This is the preferred method of valuation when comparable sales data are available.
Sales/Market Data
SALE LOCATION DATE PRICE LAND $ PER SQ. FT.
SQ. Fr LAND
1. 7875 Willis Ave 8/31/99 $1,250,000 217,364 $11.50
Nickerson Lumber Yard
Panorama City, CA
2. 24633 San Fernando Rd. 3/31/00 $440,000 23,190 $22.64
Affordable Water Heaters
Santa Clarita, CA
3. 24715-27 San Fernando Rd. 7/28/00 $750,000 26,640 $28.15
Valley Bicycle Shop
Santa Clarita, CA
4. 18027 Sierra Hwy. 8/28/00 $410,000 45,302 $9.05
Canyon Country Feed Bin
Santa Clarita, CA
5. 24609-31 Arch St. 12/29/00 $1,950,000 81,025 $24.07
22414 13th St.
KIM Motorcycles
Santa Clarita, CA
6. 24328-30 San Fernando Rd. 3/28/01 $475,000 13,200 $35.98
Jazmins Bakery
Santa Clarita, CA
7. 24953 San Fernando Rd. 4/27/01 $500,000 17,470 $28.62
My Tire Store
Santa Clarita, CA
Based on the data, the value indicated by the Sales Comparison Approach is at the rate of $80 per square
foot of building area or $947280 (11,841 sq. ft. of improvement x $80 per sq. ft.) and $12.50 per square
foot of land area or $1,045.650 (83,652 sq. ft. land x $12.50 per sq. ft.). These'two value conclusions
reconcile to a value indication of $1,000,000 for the improved portion of the subject property, that is the
most northerly portion of the subject property, which is currently improved. Plus excess land value of
$1,093,750 (125,000 sq. fL @ $8.75).
After adjustments for time, depreciation of improvements and land values as each sale related to the
subject, it was concluded that the value under the Sales Comparison Approach is $2,095,000 ($177 per sq.
of building area and $10.04 per sq. ft. of land area).
INCOME CAPITALIZATION APPROACH The income capitalization approach is based on a review
of data provided by the property owner about the subject property lease and a study of rental data on
comparable space in the area. This approach is considered the least reliable since the subject property is a
facility with excess land and would most likely be purchased by an; owner -user
Page 3
Rental Data
LEASE LOCATION DATE TERM UNIT SIZE MO. $ PER SQ.
SQ. Fr. Fr. UNIT
1. 16922 Sierra Hwy 11/01 Mo. -Mo. 15,000 $0.43
Santa Clarita, CA
2. 24219 Railroad Ave Available 1,800 $1.11
Santa Clarita, CA
3. 25655 Springbrook Ave 6/01 10,000 $0.42
Santa Clarita, CA
Based on a study of the data and knowledge of rental values in the district the opinion has been formed that
the value under the Income Approach is $1,930,000 (Main Building- 11,841 sq. ft. @ $0.45 x 12 months =
$63,941 plus Shed Building- 13,095 sq. ft. @ $0.20 x 12 months =$ 31,428 minus vacancy and collection
losses at 5% $4,768 minus management costs and structural reserves = $7,030 for an estimated $83,571
capitalized at 10.% = $835,710 plus excess land value 125,000 sq. ft. @ 8.75 =1,093,750 ).
VALUE CONCLUSIONS
Indicated values of the subject property are as follows:
Cost Approach $2,185,000
Sales Comparison Approach $2,095,000
Income Approach $1,930,000
As a result of the examination and study made, and the appraiser's years of experience in the field of real
property valuation, the opinion formed by the appraiser is that fair -market value of the subject property, as
of October 24, 2001, is $2,150,000.
ESTIMATE OF NST COMPENSATION
TWO MILLION ON HUNDRED FIFTY THOUSAND DOLLARS
($2,150,000)
t[nsfnd\stott4lffiwattOfferLetter.doc
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