Recommended
Recommended
More Related Content
Viewers also liked
Similar to Cliff Smirl #LGEDC2016 - First Nations National Land Governance & Economic Development
Similar to Cliff Smirl #LGEDC2016 - First Nations National Land Governance & Economic Development (20)
Recently uploaded
Recently uploaded (20)
Cliff Smirl #LGEDC2016 - First Nations National Land Governance & Economic Development
- 2. 2 • About Kent-Macpherson – Rod Cook & Cliff Smirl • Our First Nations Clients • What is an Appraisal? – Purposes of Appraisals – Key Definitions – Market Value of Reserve Land Interests – Terms of Reference – Assumptions – Highest and Best Use – Types of Appraisals Kent‐Macpherson
- 3. • Based in Kelowna and serving B.C. • Established in 1973 – 43 yrs in Business • Reputation for Professionalism and High Standards • Recognized as one of Western Canada’s leading authorities in Real Estate Valuation and Consulting • 20 Awesome People; including 10 Appraisers, plus Associates and Support Staff • Serving all of B.C. & special project assignments throughout Canada 3Kent‐Macpherson
- 4. • 39 years Commercial Appraisal and Consulting experience • Qualified as an expert witness before – Supreme Court of B.C. – Federal Court of Canada. – Specific Claims Tribunal. • First Nations Expertise – Provides real estate appraisal and consulting services to 69 First Nations across BC and Canada. • Designations: – AACI, (Accredited Appraiser) Appraisal Institute of Canada; – RI, Professional Designation, Real Estate Institute of British Columbia. – C. Arb., Chartered Arbitrator, Arbitration and Mediation Institute of Canada Inc. – P. App., Professional Appraiser, Appraisal Institute of Canada. 4Kent‐Macpherson
- 5. • 10 years Commercial Appraisal and Consulting experience • Qualified as an expert witness before – Supreme Court of B.C. – Specific Claims Tribunal. • First Nations Expertise – Provides real estate appraisal and consulting services to 32 First Nations across BC. – Completing PhD in Aboriginal Housing Experiences. • Designations: – AACI, (Accredited Appraiser) Appraisal Institute of Canada; – P. App., Professional Appraiser, Appraisal Institute of Canada; – MAI, Appraisal Institute (Chicago, USA). 5
- 7. Adams Lake • Beecher Bay • Bonaparte • Boothroyd • Canim Lake • Cayoose Creek • Cheam • Coldwater • Fort Nelson • Haisla Nation • Iskatewizaagegan • Halfway River • Katzie • Kitselas Ktunaxa • Lake Babine • Little Shuswap • Long Plain • Lower Nicola • Lower Similkameen • Lyackson • Lytton • Metlakatla • Moberly • Musqueam • Nadleh Whut’en • Namgis • Neskonlith • Nlaka’pamux Okanagan • Osoyoos • Pauquachin • Penticton • Popkum • Sakimay • Seaspunkut • Semiahmoo • Shoal Lake • Shuswap Tribal Council • Siksika • Simpcw • Siska • Skway • Skeetchestn • Skuppah Sliammon • Splatsin • Spuzzum • Squamish • Squiala • STÓ:LŌ • Sucker Creek • Takla Lake • Teslin Tlingit • Tk'emlúps • Tsawwassen • Tobacco Plains • Toosey • Tsleil-Waututh • Tsawout • Tzeachten • Union Bar • Upper Nicola • Upper Similkameen • Westbank • White Bear • Whispering Pines • Williams Lake • Xaxli’p Appraisal, Development Consulting and Negotiations on First Nations Lands 69 Bands in BC and across Canada 7Kent‐Macpherson
- 8. Kent-Macpherson 8 1. What is an appraisal? 2. Who is qualified to prepare an appraisal? Accredited appraisers with a national designation AACI (Accredited Appraiser Canadian Institute) are the only ones accepted by INAC and PWGSC, financial institutions and government agencies P. App. – Professional Appraiser 3. Appraisal standards; CUSPAP (Canadian Uniform Standards of Professional Appraisal Practice)
- 9. 9 • The Appraisal Institute of Canada requires compliance with Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP). • While conformance with the Standards is important, members are constantly encouraged to engage in “best practices.” • The rules are “principle based” (they allow members some latitude in how they approach certain appraisal problems). • However, some members are overly sensitive to client requests or demands to complete work that may not suit the end use due to fee constraints, time constraints, or simplified Terms of Reference.
- 13. 13 Appraisals for Litigation Tsleil‐Waututh – Dollarton Highway ‐ 1931 ‐ Value of R/W ‐ Damages!
- 14. 1. Market Value 2. Market Rent 3. Highest and Best Use 4. Lease 5. Leasehold Interest 6. Fee Simple Interest 7. Lessee’s Interest 8. Lessor’s Interest Kent-Macpherson 14
- 15. • The Terms of Reference are critical in every appraisal. • They lay the foundation or basis for the premise of value. 15
- 16. • What Interest in the land is to be valued? • Is it the Leased Fee interest? • Is it the Leasehold interest? • Is it to be considered on an “as if fee simple” basis? • What Assumptions are to be made? –Are they reasonable? –Does it matter? 16
- 17. • Example of the importance of clear Terms of Reference • Is this land to be valued as remote oceanfront acreage with no services? or…. Potential deep sea port? If as a Port, are all approvals to be considered in the valuation? Kent-Macpherson 17
- 19. 19 • Is the interest in the land marketable? – Leasehold Interests: • Prepaid Head Lease (typically long-term in nature) • A lease with predetermined step-ups or participation clauses • The more traditional lease with periodic rent reviews $100K $120K $140K $100K ? ?
- 20. • The market value of a prepaid leasehold interest is primarily a function of the permitted use and term. • Generally attracts the most substantial developments. • Can be readily subleased (if done correctly☺). 20
- 21. • Market value of land as freehold typically establishes the upper limit of value for long-term prepaid leases as… – The lessee doesn’t enjoy full bundle of rights. – The leasehold interest is more difficult to finance. – The term is finite. – Permitted uses are often limited and defined. – Political climate on the Reserve can impact value. • The value of a long-term prepaid lease relates more to "market value” than "rental value.” 21
- 22. • Market Analysis – Supply/Demand • Servicing Issues (water, sewer, gas) • Topography (flat, steep) • Soils (gravel, swamp, clay) • Environmental • Sara Legislation (Set backs, leave strips) • Archaeological Concerns 22Kent‐Macpherson
- 24. Shelter Bay/Concord Pacific 24Kent‐Macpherson $1 Billion Buildout (Until 2008 financial meltdown)
- 25. • Can be complex 25Kent‐Macpherson Before… …After
- 26. • Separate the politics from the development and approval process. • Set out a complete, clear, straight- forward approval & leasing process with timelines, costs, etc. 26
- 27. 27 Lease Structure & Land Use: • Determine type of lease you would accept (Prepaid or periodic rent review). • Term of lease (25, 49, 99 year lease and beyond). • Identify land uses you and the Band would support. • Be patient.
- 28. • Identify potential land uses with broad land use planning; • Identify Multi-family, Commercial & Industrial sites in urban settings. • Forestry, Tourism/Recreational, Agriculture in rural or remote locations. • Set aside areas for Band housing, Cultural & Administrative facilities. 28
- 30. Tk'emlúps First Nation ‐ Mt. Paul Industrial Park 30Kent-Macpherson • 5 year rent reviews • Great long term cash flow
- 31. Market Value Appraisal / Advice Proposed Retail/Commercial Development Westbank First Nation 31Kent‐Macpherson
- 32. Hotel / Hospital Feasibility Analysis Westbank First Nation 32Kent‐Macpherson
- 33. Area 27 Osoyoos Indian Band 33Kent‐Macpherson
- 34. • The Highest and Best use of the land must be assessed. • The lease indenture must be secured for sublease. • Sound advice from qualified, experienced appraisers, lawyers, and financial advisors is essential. • The market will always be the driving force for development on Reserve lands. 34
- 35. • Specific Claims need to be addressed in a fair and reasonable manner. • Incredible development opportunities exist and will materialize over the next decade as Reserve lands occupy some of the best real estate available for development. 35
- 36. INAC DOJ R/W Highest & Best Use Financing CWS SARA QUESTIONS? 36Kent‐Macpherson
- 37. Cliff Smirl, AACI, P.App, MAI 304-1708 Dolphin Ave, Kelowna British Columbia, V1Y 9S4 Phone: 250-763-2236 Fax: 250-763-3365 csmirl@kent-macpherson.com