2. A Client Walks Into the Door…
Real Estate properties are typically marketed using three types of
valuation approaches.
Sales Comparison Approach
• Uses current comparable property sales of similar use, time of
sale, location, size, zoning, access, utilities, age and amenities.
Income Approach
• Analyzes generated income and expenses from property.
• Compares comparable rental rates, vacancies to rental income
generated by property and related operating expenses.
Cost Approach
• Analyze cost to replace of property based on cost index or actual
development costs and deducting accrued depreciation (physical,
economic obsolescence or functional obsolescence).
• Incorporate site value to add to Cost Approach for Total Property
Value
3. And They Have an Interesting Property to Market…
Many Different Properties Besides Multifamily, Offices, Hotels, Retail and Warehouses
■ Agricultural Lands (dry farmland, irrigated farmland, ranch land)
■ Agricultural Improvements (silos, packaging plants, distribution
facilities, livestock feedlots, slaughter yards)
■ Boatyards
■ Gasoline Stations
■ Marinas
■ Mobile Home Parks
■ Storage Unit Facilities
■ Timberland
■ Water Rights
4. Agriculture
Valuation Approaches Adjustments
Irrigated and Non-Irrigated Sales Comparison Approach Sale date, acreage, soils, location
Ranch Land Income Approach (if leased) access, water access, utilities
Agricultural Improvements Sales Comparison Approach Sale date, age, size,
location, access,
construction quality,
utilities
Cost Approach Less Physical Depreciation
5.
6. Boat Yards & Marinas
Valuation Approaches Adjustments
Boat Yards Sales Comparison Approach Sale date, age, location, water frontage (LF), acreage
construction quality, utilities, amenities, tidal leases
Income Approach Rent/waterfront linear foot, no. of slips and sizes,
tidal leases (state or tribal), amenities (store, fuel dock)
Marinas Sales Comparison Approach Sale date, age, slip size, location, construction quality,
waterfront LF, covered/uncovered slips, tidal leases,
Income Approach Slip rental, vacancy rate, construction quality, tidal leases
Cost Approach Less Physical Depreciation or Functional Obsolescence
7.
8. Gasoline Service Stations
Valuation Approaches Adjustments
Sales Comparison Approach Sale date, age, acreage, location, corner location, entry/egress from
roads,
improvement construction quality, site improvements, age of fuel tanks
Income Approach (if leased) Ground lease or leased improvements, retail Income from fuel & food,
operating expenses, lease length & terms, age of fuel tanks
Cost Approach Less Physical Depreciation, or any Economic & Functional Obsolescence
9. Historic Mansions Adjustments
Sales Comparison Approach – sale date, building size, age,
construction quality, rooms,
zoning, legal uses allowed
10. Mobile Home Parks
Valuation Approaches Adjustments
Sales Comparison Approach Sale date, age, location, owned ground or ground lease, site size,
location,
site improvements, no. of lots, utilities
Income Approach (if leased) Ground lease, lot rental rates ,length of lease terms, vacancy, turnover,
free rent given
operating expenses
11. Storage Units
Valuation Approaches Adjustments
Sales Comparison Approach Sale date, age, location, owned ground or ground lease, site size,
location,
improvement construction quality, storage unit density and size, no. of units,
road access & visibility
Income Approach (if leased) Ground lease or leased improvements, unit rental rates, unit vacancy,
turnover,
free rent given, operating expenses
Cost Approach Less Physical Depreciation, or any Functional Obsolescence
13. Water Rights
Sales Comparison Approach
Compare acreage with and without water rights.
Try to use similar parcels in use, soil condition,
location.
Adjust for sale time, size, and access.
