HomeMy WebLinkAboutResolution 5094 Setting the Fair Market Value of Land for Calculating Cash-in-lieu of Parkland Dedication RESOLUTION NO. 5094
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN,
MONTANA, SETTING THE FAIR MARKET VALUE OF LAND PER SQUARE FOOT
FOR CALCULATING CASH-IN-LIEU OF PARKLAND DEDICATION
WHEREAS, Section 38.420.030 of the Bozeman Municipal Code, ("Cash Donation in
lieu of Land Dedication") states that the city commission may adopt procedures to be used by the
director of parks and recreation to determine the fair market value for cash in lieu of parkland
dedication donations; and
WHEREAS, Section 38.420.030 of the Bozeman Municipal Code states that the city
must periodically update the market value as deemed necessary to reflect changes in the price of
land; and
WHEREAS, Resolution 4938 was adopted on August 6, 2018 establishing the fair
market value of land for purposes of cash donation in lieu of park dedication for up to one calendar
year; and
WHEREAS, an updated appraisal report has been obtained from a qualified, licensed
appraiser to determine the fair market value of unsubdivided, unimproved land after it has been
annexed and given a municipal zoning designation in accordance with Montana Code Annotated
Section 76-3-621; and
WHEREAS,the appraisal report indicates the fair market value of residential property
for the purposes of cash donation in lieu of park land dedication is $1.60 per square foot(Exhibit
A);
i
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of
Bozeman, Montana, that the fair market value of residential property for the purposes of cash
donation in lieu of park land dedication is $1.60 per square foot, subject to changes in market
conditions that warrant an updated appraisal.
PASSED, ADOPTED, AND APPROVED by the City Commission of the City of
Bozeman, Montana, at a regular session thereof held on the 16'h day ofeptember, 2019.
CYNTHIA L. ANDRUS
Mayor
ATTEST:
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off. • ■ •?� ,
ROBIN CROUG -
City Clerk •
�!`�TI�V G�•��
APPROVED AS TO FORM:
-b'l
GRE ULLIVAN
City Attorney
Resolution 5094
Exhibit A
AN APPRAISAL REPORT OF:
Standard Property Valuation for the City of Bozeman's Cash in Lieu of Parkland Dedication
Process
FILE NO.:
C083019380
PREPARED FOR:
Mr. Mitchell Overton
City of Bozeman-Department of Parks and Recreation
415 North Bozeman Avenue
Bozeman, MT 59715
PREPARED ON:
August 30, 2019
EFFECTIVE DATE OF VALUATION:
August 1, 2019
PREPARED BY:
Keith O'Reilly, MAI,MT-400
Bridger Appraisals, Inc.
P.O. Box 11145
Bozeman, MT 59719
is -
. BRIDGER
Ar->PRAISAI S
August 30, 2019
City of Bozeman-Department of Parks and Recreation
415 North Bozeman Avenue
Bozeman,MT 59715
Re: Standard Property Valuation for the City of Bozeman's Cash in Lieu of
Parkland Dedication Process
Dear Mr. Mitchell Overton,
Per your request, I have gathered information and completed the following report to
establish a standard property valuation on a per square foot basis for Residential Single-
Household Low Density (R1), Residential Two-Household Medium Density(R2),
Residential Medium Density (R3), Residential High Density (R4), and Residential Office
(RO) districts within the City of Bozeman. This report is to be used for the City of
Bozeman's Cash in Lieu of Parkland dedication process. This appraisal is not of one
subject property but is rather a compilation of sales of large tracts of land within the City
as well as Gallatin County purchased for development purposes.
Per city code and state law:
Cash donation in-lieu of land dedication shall be equal to the fair market value of the
amount of land that would have been dedicated. For the purpose of these regulations, the
fair market value is the value of the unsubdivided, unimproved land after it has been
annexed and given an urban zoning designation. The city intends to obtain the highest
value for cash-in-lieu of park land that is allowable under state law.
ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal report,the letter of transmittal, and certification are subject to the following
assumptions and limiting conditions; and also, any special qualifying conditions that may be
contained elsewhere in the report are incorporated by reference.
Assumptions
1. That the legal descriptions, as furnished, are correct; and that the titles to the properties are
good and marketable. All existing liens and encumbrances,if any, have been disregarded.
The properties are appraised as though free and clear of other burdens,under responsible
ownership and competent management.
2. That the land dimensions taken from available maps,plats, and/or surveys are correct. It has
been assumed that those boundaries that are apparent are correct.
3. It is assumed that the use of the land and improvements is confined within the boundaries or
property lines of the property described and that there is no encroachment or trespass unless
noted in the report.
4. That no adverse water table or soil conditions exist,and no representation regarding such
conditions is made in this report unless specifically stated; and,that the value estimated is
predicated on the absence of any such conditions occurring.
5. Those opinions, estimates,data and statistics supplied by others in the course of this study,
are correct;the assumption has been made that the sources are reliable,but no responsibility
has been inferred for their accuracy.
6. This report does not contemplate any court action,nor does it obligate the appraiser to give
any testimony or make any appearance in court,before commission,arbitrator or any other
individual,body or agency. If court action or appearance later becomes necessary in the
interest of the client,the terms of the additional service shall be negotiated at that time.
Bridger Appiaisais Inc.
Keith O'Reilly,MAi
7. Unless otherwise stated in this report,the appraiser has no knowledge of the existence of
hazardous material,which may or may not be present on the properties. I am not qualified to
detect such substances. The presence of potentially hazardous materials may affect the value
of the property. This extends to any leaks from underground fuel storage tanks,and
identification of Asbestos containing materials. The value estimate is predicated on the
assumption that there is no such material on or in the property.No responsibility is assumed
for any such conditions or for any expertise or engineering knowledge required to discover
them. The client is urged to retain an expert in this field, if desired. Any such environmental
risk discovered at a later date may require a revised estimate of value that may or may not be
simply a reduction of the value by the estimated cost to cure the environmental condition.
Properties known to have environmental risk may also carry a stigma in the market place that
may or may not affect the value. If future soil tests should reveal the existence of any such
soil conditions or hazardous waste,I reserve the right to review and adjust this appraisal
accordingly.
Limiting Conditions:
1. The appraiser is not responsible for any matter legal in character,nor is any opinion rendered
as to title,which is assumed to be marketable.
2. The value reflected in the analysis applies only to the program of utilization considered in this
report. The use of the value in conjunction with any other appraisal or under other influences
invalidates the conclusions developed.
3. This analysis and estimate of value is made for the exclusive use and benefit of the clients to
whom it is addressed; and,possession of this report or a copy, does not carry with it the right
of publication,nor may it be used for any purpose other than that intended without the
previous consent of the appraisers. In any event, only the entire report may be used and no
part shall be taken or used out of context.
4. Included as an integral part of this report are maps and photographs of the comparable
properties and sales. The maps and photographs were prepared and taken by the appraisers,
and although they do not purport to represent survey accuracy,they are substantially correct
and adequately serve as visual reference to the properties.
S. Disclosure of the contents of this report is governed by the By-Laws and Regulations of the
Appraisal Institute.Neither all nor any part of the contents of this report(especially any
conclusions of value,the identity of the appraisers or the firm with which they are connected)
shall be disseminated to the public through advertising media,public relations,news media,
sales media, or any other public means of communication without the prior written consent
and approval of the authors.
6. The forecasts,projections, or operating estimates contained herein are based on current
market conditions, anticipated short-term supply and demand factors, and a continued stable
economy. These forecasts are,therefore, subject to changes with future conditions.
Bridger Appraisals Inc.
Keith O'Reilly,MAI
SUMMARY OF IMPORTANT FACTS AND CONCLUSIONS
Client: Mitchell Overton, City of Bozeman - Department
of Parks and Recreation
Intended User: City of Bozeman - Department of Parks and
Recreation
Date of Valuation: August 1,2019
Date of Preparation: August 30, 2019
Rights Appraised: Fee Simple
Highest and Best Use: The highest and best use is not applicable to this
appraisal report as the valuation is not of a subject
property,but rather a compilation of sales to
establish a standard property valuation.
SCOPE OF THE APPRAISAL
The scope of work consists of the amount and type of information researched and
analyzed in an assignment.
In preparing the appraisal, I have considered pertinent characteristics of the comparable
sales in comparison to current market standards. I have gathered information and
completed the following report to establish a standard property valuation on a per square
foot basis for Residential Single-Household Low Density(RI), Residential Two-
Household Medium Density (R2), Residential Medium Density(R3),Residential High
Density(R4), and Residential Office(RO) districts within the City of Bozeman.
General and specific data was obtained through personal and telephone interviews with
government officials,property managers, developers, and other market participants. I
have not considered the highest and best use as it is not applicable to the standard
property valuation on a per square foot basis of Rl,R2, R3, R4, and RO districts within
the City of Bozeman. I have applied the sales comparison approach valuation method to
determine a standard property valuation method on a per square foot basis. This is the
only applicable approach to valuing vacant land. The results indicated by this method
have been reviewed and reconciled based on the reliability,relevance and reasonableness
of the data, and the purpose and intended user of the appraisal.
This is an Appraisal Report as defined by Uniform Standards of Professional Appraisal
Practice under Standards Rule 2-2. This format provides a summary of the appraisal
process, subject and market data and valuation analyses. The information contained in
this report is specific to the needs of the client and for the intended use as stated in this
report.
PURPOSE AND INTENDED USE AND USER OF THE APPRAISAL
The purpose of this appraisal is to estimate a credible opinion of the Current Market
Value on a per square foot basis of the Fee Simple Interest for Residential Single-
Household Low Density(RI), Residential Two-Household Medium Density (R2),
Residential Medium Density (R3), Residential High Density (R4), and Residential Office
(RO) districts within the City of Bozeman, in accordance with the Uniform Standards of
Professional Appraisal Practice (USPAP) and supplemented by the Appraisal Institute.
The intended use of the appraisal is to assist the Client and Intended User, City of
Bozeman-Department of Parks and Recreation, in establishing a standard property
valuation for vacant land on a square foot basis to be used for the City of Bozeman's
Cash in Lieu of Parkland dedication process.
DEFINITION OF MARKET VALUE
Market value is defined as the most probable price, which a property should bring in a
competitive and open market under all conditions requisite to a fair sale, the buyer and
seller, each acting prudently and knowledgeably, and assuming the price is not affected
by undue stimulus. Implicit in this definition is consummation of a sale as of a specified
date and passing of title from seller to buyer under conditions whereby:
1. Buyer and seller are typically motivated;
2. Both parties are well informed or well advised, and each acting in what they consider
their own best interest;
3. A reasonable time is allowed for exposure in the open market;
4. Payment is made in terms of cash in U.S. dollars or in terms of financial
arrangements comparable thereto;
5. The price represents the normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted by anyone associated with
the sale.r
'[Source: Section 323.2 amended at 57 Fed.Reg.9049,March 16,1992;59 Fed.Reg.29501,Jute 7, 19941
Bridger Appraisals Inc. C7
Keith O'Reilly,MAI
PROPERTY RIGHTS APPRAISED
Property rights are ownership interests in real estate and have value. It is important to
know what property right(s) or estate(s) are involved in the appraisal,because the estate
identifies the rights being valued. The subject property rights being appraised is the Fee
Simple Interest.
Fee Simple: Absolute ownership unencumbered by any other interest or estate, subject
only to the limitations imposed by the governmental powers of taxation, eminent domain,
police power and escheat.'
Leased Fee: A freehold(ownership interest) where the possessory interest has been
granted to another party by creation of a contractual landlord-tenant relationship (i.e. a
lease). 3
VALUATION DATE
The effective date of the appraisal is August 1, 2019. This is the date of valuation. The
comparable sales reflected in this report are the most current identifiable sales as of the
effective date.
z The Dictionary of Real Estate Appraisal,5th ed.(Chicago;Appraisal Institute,2010),p.78.
3 The Dictionary of Real Estate Appraisal,5th ed.(Chicago;Appraisal Institute,2010),p.111.
MONTANA REGIONAL AND CITY MAPS
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Keith O'Reilly,MAI
REGIONAL, CITY, AND NEIGHBORHOOD ANALYSIS
Bozeman, Montana is located in Gallatin County, in an area more commonly referred to
as the Gallatin Valley. This report is for the Client and Intended User,the City of
Bozeman—Department of Parks and Recreation. Information regarding the City of
Bozeman has not been included as this information is provided from the City of Bozeman
and the client and intended user has access to this information.
THE APPRAISAL PROCESS
Typically,real estate can be valued by applying three approaches. All of these approaches to value,
(particularly when the purpose of the appraisal is to establish market value)are market data approaches
since the data inputs are presumably market derived.
Cost Approach: One of the approaches to value commonly applied in Market Value
estimates and many other valuation situations. A comparative
approach to the value of property or another asset that considers,as
a substitute for the purchase of a given property, the possibility of
constructing another property that is an equivalent to the original
or one that could furnish equal utility with no undue cost resulting
from delay. The Valuer's estimate is based on the reproduction or
replacement cost of the subject property or asset, less total
(accrued) depreciation. The cost approach establishes the value of
a real property by estimating the cost of acquiring land and
building a new property with equal utility or adapting an old
property to the same use with no undue cost due to delay. An
estimate of entrepreneurial incentive or developer's profit/loss is
commonly added to land and construction costs. For older
properties, the cost approach develops an estimate of depreciation
including items of physical deterioration and functional
obsolescence.4
Sales Comparison Approach: A comparative approach to value that considers the sales of similar
or substitute properties and related market data and establishes a
value estimate by processes involving comparison. In general, a
property being valued (a subject property) is compared with sales
of similar properties that have been transacted in the open market.
Listings and offerings may also be considered. A general way of
estimating a value indication for personal property or an ownership
interest in personal property, using one or more methods that
compare the subject to similar properties or to ownership interests
in similar properties. This approach to the valuation of personal
property is dependent upon the Valuer's market knowledge and
experience as well as recorded data on comparable items.5
Income Approach: A comparative approach to value that considers income and
expense data relating to the property being valued and estimates
value through a capitalization process. Capitalization relates
income (usually net income) and a defined value type by
converting an income amount into a value estimate. This process
may consider direct relationships (whereby an overall
capitalization rate or all risks yield is applied to a single year's
income), yield or discount rates (reflecting measures or return on
investment)applied to a series of incomes over a projected
period, or both. The income approach reflects the principles of
substitution and anticipation.6
s The Dictionary of Real Estate Appraisal,5th ed.(Chicago;Appraisal Institute,2010),p.250.
5 7be Dictionary of Real Estate Appraisal,Sth ed.(Chicago;Appraisal Institute,2010),p.244.
The Dictionary ofReal Estate Appraisal,5th ed.(Chicago;Appraisal Institute,2010),p.256
Bringer Appraisals Inc. KD
Keith O'Reilly,MAI
Comparable Sales
The following sales have been used to estimate a value on a per square footage basis. The
compiled data represents the most recent known sales of speculative development land
within the City of Bozeman and Gallatin County.
Land Coin arable 1
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Transaction
ID 1259 Verification Source Purchaser
Address 5250 Baxter Lane Price $8,800,000
City Bozeman Price Per Acre $55,000.00
State MT Financing Cash to Seller
Tax ID RGG6855 Property Rights Fee Simple
County Gallatin Days on Market --
Grantor Fern Vesta Anderson Recording Date 06/07/19
Grantee NWX,LLC Recording Number 2646897
Legal Description Tract 5 of COS 2552,NE 1/4 of Section 4,Township 2 South,Range 5 East,Gallatin County,MT
Site
Acres 160.0 Topography Level
Land SF -- Zoning Not Zoned
Road Frontage -- Flood Zone None
Dimensions Rectangular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues None
Access Baxter Lane Price Per Land SF $1.26
Comments
This property sold on 06/07/2019 for$8,800,000 or$55,000 per acre for 160 acres.The property went under contract in the
early fall of 2018.The property is in the county,but adjacent to the City of Bozeman.The property is bordered to the cast by
the new Bozeman Sport Complex,and to the south by Laurel Glen,a residential subdivsion.The purchaser has applied for
annexation into the City.This property is also in proximity to the new Bozeman High School.There are no utilities to the site
and the off site costs for developement are unknown at the present time.
Bridger Appraisals Inc. O
Keith O'Reilly,ldAI
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Transaction
ID 1400 Verification Source Buy-Sell Agreement
Address TBD South 19th Avenue Price $10,000,000
City Bozeman Price Per Acre $83,600.00
State MT Financing Conventional
Tax ID RGG9600 Property Rights Fee Simple
County Gallatin Days on Market None
Grantor Bozeman Ranch Land,LLC Recording Date -
Grantee Confidential Recording Number Pending
Legal Description The South 1/2 of the Southwest 1/4 of Section 24 and the North 1/2 of the North 1/2 of the Northwest
1/4 of Section 25 in Township 2 South,Range 5 East,Gallatin County,Montana.
Site
Acres 119.6 Topography Level
Land SF 5,210,522 Zoning See Comments
Road Frontage South 19th Avenue Flood Zone None
Dimensions Rectangular Encumbrance or Basement None
Utilities NorthWestern Energy Environmental Issues None
Access South 19th Avenue Price Per Land SF $1.92
Comments
This is the pending sale of a large tract of speculative development land that is located along the eastern side of south 19th
Avenue in the southern part of Bozeman.The property is not yet annexed into the City of Bozeman but is bordered on three
sides by properties that are annexed.The City of Bozeman is very likely to grant annexation for the property shortly
following the sale.The property is currently zoned by the Gallatin County Planning Department as AS,Agricultural Suburban
District but the buyer is attempting to achieve an REMU,Residential Emphasis Mixed-Use zoning designation for a majority of
the site from the City of Bozeman wfien it is annexed.Lower density zoning designations will be utilized for areas bordering
existing communities.The buyer intends to develop the property into a multi-phase,large-scale mixed-use residential and
commercial development.The property is already bisected by a water main for the City of Bozeman water system but the
City's preferred sewer main connection is approximately 1,300 feet north of the property at the intersection of South 19th
Avenue and Graf Street.However,it is expected that early phases of the development can be connected to smaller sewer lines
stubbed at the adjacent Alder Creek Subdivision.There are estimated to be approximately$1,000,000 in off-site improvement
costs for the widening of South 19th Avenue and the development of a traffic control light at 19th Avenue and Blackwood
Road.The property is located in a Qualified Opportunity Zone which provides for additional potential tax benefits.The
property was not openly marketed and the transaction was privately negotiated between the buyer and the seller.
Land Comparable 3
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Transaction
ID 1014 Verification Source Confidential
Address 5528 Stucky Rd Price $2,900,000
City Bozeman Price Per Acre $59,434.00
State MT Flnancing Cash to Seller
Tax ID RGG6891 Property Rights Fee Simple
County Gallatin Days on Market --
Grantor Big Sky Western Bank,a Division of Recording Date 07/18/17
Grantee R Hans,LLC Recording Number 2585905
Legal Description Tracts 1,3 and 4 of C.O.S.No.2725,being a relocation of common boundaries between Tracts 1 &2
of C.O.S.No.2122 and Tract IA-I of C.O.S.No.2029 and Parcel II,loc.in N1/2 of Sec.23,T2S,
RSE,P.M.M.,City of Bozeman,Gallatin Co.,MT.
Site
Acres 48.8 Topography Mostly Level
Land SF 2,125,467 Zoning Residential High Density(R4),
Residential Medium Density(R3)
Road Frontage -- Flood Zone No
Dimensions Irregular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues None
Access Stucky Rd,Graf St Price Per Land SF $1.36
Comments
The subject is located in southwest Bozeman,near Montana State University,The site is annexed into the city.The
surrounding area has seen recent growth with a mix of commercial and residential development.This sale was a bank owned
property that went to auction.
Bridger Appraisals Inc. O
Keith O'Reilly,MAI
Land Comparable 4
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Transaction
ID 893 Verification Source Contract-Dick Steffani
Address Oak Street and Davis Lane Price $764,600
City Bozeman Price Per Acre $76,231.00
State MT Financing Cash to Seller
Tax ID RGG9336 Property Rights Fee Simple
County Gallatin Days on Market --
Grantor William and Betty Anne Sipple Recording Date 01/18/17
Grantee City of Bozeman Recording Number 2569512
Legal Description A Tract of land containing 10.03 acres in the West Half of the West Half of the Southwest Quarter of
Section 2,Township 2 South,Range 5 East,Gallatin County,MT
Site
Acres 10.0 Topography Level
Land SF 436,906 Zoning SRR,Semi-Rural Residential Zone
Road Frontage -- Flood Zone None
Dimensions Rectangular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues None
Access Oak Street Price Per Land SF $1.75
Comments
This is a vacant 10 acre tract of land located south of Oak Street where Davis Lane will intersect.All public utilities including
water,sewer,electricty and natural gas are to the site.However,the site has not been annexed into the City of Bozeman.The
site has good access off of Oak Street.The City of Bozeman is the purchaser and bought the land to extend Davis Lane from
Oak Street to Durston Rd.
Land Comparable 5
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ID 445 Verification Source Buyer
Address 1067 Thomas Drive Price $536,000
City Bozeman Price Per Acre $53,600.00
State MT Transaction Type Closed
Tax II) RFG9580 Financing Cash to Seller
County Gallatin Days on Market 563
Grantor Kenneth and Jill Davenport Recording Date 09/30/16
Grantee O'Reilly Partnership LLC Recording Number 2559333
Legal Description NI/2 SI/2 NEIA SW IA Section 25,Township 1 South,Range 5 East,P.M.M.Gallatin County,MT
(Deed Reference:Film 29,Page 277)
Site
Acres 10.0 Topography Level
Land SF 435,600 Zoning Residential High Density(R4)
Road Frontage -- Flood Zone None
Dimensions Rectangular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues None
Access Thomas Drive Price Per Land SF $1.23
Comments
This is a 10 acre tract of speculative development land.The site fronts what is now Thomas Drive,but will become North 27th
Avenue.North 27th Avenue currently end at Cattail Street and Baxter Lane.The site has been annexed into the City of of
Bozeman and is zoned R-4.Water and sewer has been installed along Thomas Drive.There are minimal wetlands of less than.5
acres associated with this site.
Brideer Appraisals Inc.
Keith O'Reilly,MAl
LandComparaN L, 67
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ED 1055 Verification Source Donnie Olsson-Broker
Address SW Corner of Love Ln.&Baxter Price $2,550,000
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City Bozeman Price Per Acre $43,031.00
State MT Financing Cash to Seller
Tax ID RGGI 1911 Property Rights Fee Simple
County Gallatin Days on Market I
Grantor Vma Del Mar Holdings,LLC Recording Date 07/28/17
Grantee Bozeman Development Fund,LLC Recording Number 2587075
Legal Description Tracts I and 2 of C.O.S.No.2939,located in the NE 1/4 of Section 6,Township 2 South,Range 5
East,Gallatin County,Montana.
Site
Acres 59.3 Topography Level
Land SF 2,581,366 Zoning RR/A,Rural Residential&
Road Frontage Love Ln.&Baxter Ln. Flood Zone None
Dimensions Irregular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental]Issues None
Access Love Ln.&Baxter Ln. Price Per Land SIT $0.99
Comments
This is a 59.260-acre tract of speculative development land on the southwest comer of Love Lane and Baxter Lane that the
buyer intends to develop with 104 single-family residential lots.As of the date of purchase,the property was not in the Four
Corners Water&Sewer District;however,the adjacent property to the west is in the district and the buyer hopes to tie into the
meter and sewer system and purchase water and sewer entitlements for development of the proposed subdivision.The property
has an attractive location for a subdivision given its good views of the surrounding mountain ranges.The property was fisted for
sale with an asking price of$2,900,000 at the time it went under contract.
Land Comparable 7
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ID 1057 Verification Source Jennifer Trainer-Broker
Address NW Corner of Gooch Hill Rd.& Price $4,000,000
City Bozeman Price Per Acre $51,593.00
State MT Financing Cash to Seller
Tax ID RGG60568 Property Rights Fee Simple
County Gallatin Days on Market 28
Grantor Mudhead,LLC Recording Date 08/10/17
Grantee Gooch Hill Opportunities,LLC Recording Number 2589101
Legal Description Tract 2A of C.O.S.No.2682A,a tract of land located in the East 1/2 of Section 8,Township 2 South,
Range 5 East,Gallatin County,Montana.
Site
Acres 77.5 Topography Level
Land SF 3,377,207 Zoning M-I&N-S
Road Frontage Huffine Ln.&Gooch Hill Rd. Flood Zone None
Dimensions Rectangular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues None
Access Huffine Ln.&Gooch Hill Rd. Price Per Land SF $1.18
Comments
This is a 77.530-acre tract of speculative development land that is located on the northwest corner of Gooch Hill Road and
Huffine Lane,in-between the Bozeman city limits and Four Corners.Approximately 75%of the property is zoned M-I,
Manufacturing and Industrial District while the remaining approximate 25%is zoned N-S,Neighborhood Service District.There
are no water and sewer services available to the site.The buyer was Town Pump and the property was purchased for potential
future development.There are some wetland areas on the site.The property was listed for sale with an asking price of
$4,300,000 at the time it went under contract.
Bridger Appraisals Inc.
Keith O'Reilly,MAI
Land Comparable 8
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Transaction
ID 1056 Verification Source Buyer
Address TBD Huffine Lane Price $1,800,000
City Bozeman Price Per Acre $43,552
State MT Financing Cash to Seller
Tax ED RGG61787 Property Rights Fee Simple
County Gallatin Days on Market None
Grantor Winchester Holdings,LLC Recording Date 10/10/17
Grantee Skeeter,Cayman,Quantum,&3B Recording Number 2595275
Legal Description Lot 2 of Minor Subdivision No.418,located in the SW 1/4 of Section 8,Township 2 South,Range 5
East,Gallatin County,Montana.
Site
Acres 41.3 Topography Level
Land SF 1,800,335 Zoning MU,Mixed-Use District
Road Frontage Huffine Lane Flood Zone None
Dimensions Rectangular Encumbrance or Easement None
Utilities NorthWestem Energy Environmental Issues None
Access Huffine Lane Price Per Land SF $1.00
Comments
This is a 41.330-acre tract of speculative development land located near the northeast comer of Love Lane and Huffine Lane
in the Four Corners area of Bozeman.The buyer purchased the property for future development.There are no water or sewer
services available to the site.The property was not openly marketed and the transaction was privately negotiated between the
buyer and the seller.
Land Co m rable 9
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. ... ,,..•n . _
Transaction
ID 1402 Verification Source Broker
Address 3223 Durston Rd Price $8,000,000
City Bozeman Price Per Acre $55,172.00
State MT Financing --
Tax ID RGG10239,RGG10282 Property Rights Fee Simple
County Gallatin Days on Market 159
Grantor Bonita L Nollmeyer Recording Date --
Grantee - Recording Number -
Legal Description Lengthy;retained in file
Site
Acres 145.0 Topography Mostly Level
Land SF 6,316,200 Zoning Agricultural Suburban(AS)
Road Frontage -- Flood Zone No
Dimensions Irregular Encumbrance or Easement None
Utilities NorthWestern Energy Environmental Issues --
Access Durston Rd Price Per Land SF $1.27
Comments
This is an active listing of 145 acres of vacant land located just west of the city limits on Durston Rd.The site is not annexed
into the city limits,however,it borders the city limits on one side.City water ends at the subject site and city sewer is close by.
The property was originally listed for an asking price of$10,875,000.The property went under contract after 77 days on the
market for an unknown price,however,the property fell out of contract after approximately 7 months and the asking price
was decreased to$8,000,000 or$55,172 per acre.It has remained at the decreased asking price for 75 days.
Bridger Appraisals Inc. C)
Keith O'Reilly,MAI
pring4lik, r r
Riversid •Coun- ILb
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Sale 5
Costco Wholesale
dyer Creek
.; tiGolf Course
+ a.Murdoch s'.Ranch
— ae &rHom,14ply: —'m
- Coin vim •II f a ` -
• Regional Park V ^� ; '
■ - � �, I� B„rgglKin9-,il !�'Y.�i.rt3'.
r 'BridgeerrAa ments II Bozeman'
Mor Lana State
University r`t' 90
y:jr
r
+ • —'#';M'useum of the Rockles''
` nth .`�-•� � i ��, � •.
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IandAnM sls Grid 'Co I Co 2 ConT3 Cvy4 Co 5 Cmp 6 'Comp 7 Com 8 Co 9
Address 52501kl1,ane TBD South 19th 3528 Stucky Rd O.s1;Street and Davis 1057Thomas Dme SWComerottnve NW Comeror 110Hu0nelane 32.13Dunton Rd
Avenue tans Ln.d B.4,,tn. Gooch Hdl Rd.&
Huffme ln.
City 13-.. W-n B.- B Boxnnn It- 11- Bo.- W.-
State MT AIT \IT NIT MT MT MT %IT MT
Date 81112019 617/2019 TM017 11182017 913a'2016 71-IMO17 81102017 71V2018
&ice SSM100) S10,0KOW S490Q0)0 S764,60) S536,W0 S2,5AOW S4,000,000 SI,80'm SUKOW
Ac 000 160.0) 119.62 48.79 I&W 10.00 59.26 77.53 4133 14160
A-Unit Price DO() S83,600 is9,434 S76,231 S53,600 S43,031 S51,593 S43,552 $55,172
Trmsactim A'ustnYnts
P.p,ty Rie'h, Fx Smpk Fz Smple OVS Fee Smpk 0.0% fie Smpte 0.0% Fee Smpk Ob'✓,Fee Smpk 0.0% FttS d 0.0% Fx Smpk 0.0%Fee Smpk 0.0% Smpk 00%
Co mlio n
Fi..e,g Coavmtianat Cah to&Oer 0.0% 9 Dh% Grh to Self, OV; Wh so Selkc 00%Cash to&Ikr 0.0% Cash to&Ikr 0.0% Wa to&her 0.0%Wh to&ll, 0 0'.5 0 0-0%
Condtrons of Sk U6 A-%Lmgh 00% Ungh 0.0% .Arm'd-egh 00% A-%L.,,h 00%.Ar'9Lmgh 0.0% Arms Lzngh &0% A-%Ltndh 0.0%.Arm's Lev h 0.0% 0 0.0T.
Bt-&-Aner&k S0 e„O so SO s0 s0 s0 s0 s0
Ad'ustedAcrelitit Price S55,000 '$83,600 $59,434 $76,131 S53,600 $43,031 $51,593 "$43,552 S55,172
klakd Tr Ib Th.,v 811119 100/ 1.43; OIPG 21.4% 273% 31.01; 21.1% 203% 10.91% O.U35
A'ustedAcre[klt Price S55,'N6 S83,600 S7Z178 `S97,Q53 SU,231 SS2,122 S6 881 548,�96 555,172
incatan Crud Cnod Cnod G,0d C-d Cnod Cnod Cnod Good Cnod
%Adp¢t�nt 04e 0?o N. 0% 0'6 013 0% (PA 0%
SAd'stmnt s0 SO SO SO SO SO so s0 SO
Acres 0.10 160.00 119.62 48.79 10.03 10.00 5926 77.53 4133 145.0)
%Adj.trrcnt 011. 0% 01/. 0'/ C% U/ 01A W. 0116
SAd"stsmnt SO SO SO SO s0 SO SO h SO
Topography Level tavel Level Mostly L-1 level level level level UM Mostly level
%Adjot_t 0?'0 0'16 0'/ 0% 0?e 1% all'. IN 0115
SAd' tnem SO SO SO SO SO SO so 93 50
Shape hr SAe shapa Rz,•.tangutar Rectangular Irmguhr Rectangular Recta pbr I guku Rntaag.h, Rectangular egukv
%Adjust-, U/ 095 0'/ U/ 0)6 US U/ W 0J6
SAd' =rent SO SO s0 s0 s0 s0 SO SO SO
Utilities Lk,:t ity,Water, NorthWotem Energy NoOWestem NorthWcstem Fnergy NOrthWestem NoMWestem NotthWcst- NoAhWestcm NathWestem NorthWestem
Sewer,GU Energy lnergy tnergy Energy fe,gy aergy EeBy
%Adjust-1 01/, 011. 01% U/ 0116 US MA 0% U!,
SAd'stwt SO SO SO s0 SO s0 SO S0 s0
Zoomg Northuestem Not Zoned Sm Canm is R.demul High D-4 SRR,SeOaltuml Residential High RR/A,Runt M-IBNS MU,Nfmd4he Agdcukunl
(R4)MilemWNIedium ResidemblZone Density(R4) ResiientW& lystrkl Subudsan(AS)
Density(R3) Agrieuhuml
%Ad'stn nt 0116 0% 0'/ U/ 011; 0111 0% U/ 036
A j.UdAare Wt Prim ""$55,796 '$83,600 $72,178 "$97,058 ` "$70,233` 552,122 `'$62,281 ``S48,296 'SSS,172
fs'et Adjustments 0.0% 0.0114 QUA 0.0'/ UP,. 0.0% O.N. 0.0'/ 0.0%
Cmss Ad'ortm<nts 001S 0.0115 QU/ QU/ 0.036 0.01A QUJ 0.0% 0.01'e
The provided sales give a good indication of the per square foot valuation for vacant land
in the City of Bozeman. This valuation is for Residential Single-Household Low Density
(R1), Residential Two-Household Medium Density(R2), Residential Medium Density
(R3), Residential High Density (R4), and Residential Office (RO) districts.
Sales 1 and 2 are very current, while Sale 3 is a bit older. However, all fit the criteria and
definition for the Cash in Lieu program. Sale 1 had approval to be annexed into the City
at the time of sale and Sale 2 is likely to be annexed in after closing. Sales 1 and 2 will
likely be developed with a mix of commercial and residential while Sale 3 will likely be
developed mixed-use residential. Sale 1 is the largest available sale at 160 acres,with
Sale 2 as 120 acres, Sale 3 is a more moderately sized 49 acres. Typically,the larger the
site, the lower the value per acre, and the smaller the site, the higher the value per acre;
however, Sale 2 is the second largest site and has one of the highest indicated prices per
acre. All three sales are typical sites where the developers will literally have to give up
the physical land for park. These sales indicate a range of$55,796 to $83,600 per acre, or
$1.28 to $1.92 per square foot.
Bridger Appraisals Inc.
Keith O'Reilly,MAI
Comparable Sales 6, 7, and 8 are sales of large tracts of land that have not been annexed
into the City but were purchased for speculative development purposes. The per square
foot range of values for these sales was $0.99 to $1.18. These comparables help to
establish to the lower limit of value on a per square foot basis. The per square foot value
of these comparables is lower than those sites annexed into the City,which is expected,
as the purchasers of these sites would have additional costs for annexation and accessing
utilities. Comparable 6 is planned to be developed residentially,while Comparables 7 and
8 will most likely be developed with commercial and residential improvements. There is
not a large difference in per square foot value on the residential sale versus the
commercial/residential.
Comparable 9 is an active listing of a property that fell out of contract. While the contract
price was unknown, it appears the development costs were too high for the original
contract price to be feasible. The site is not annexed into the city,but it located adjacent
to the city limits and is in the path of development. This comparable shows that the
original asking price of$75,000 per acre or$1.72 per square foot was too high to be
financially feasible. Thus,the reconciled per square foot value must be less than these
indicated values.
There have been a limited number of sales in the past year. This can be attributed to the
cost of development and the fact that values for single family home sites have not
appreciated as quickly as in years past. Based upon these sales, I would estimate the per
square foot value for vacant land in the Residential Single-Household Low Density(R1),
Residential Two-Household Medium Density(R2), Residential Medium Density(R3),
Residential High Density(R4), and Residential Office(RO) districts within the City of
Bozeman at$1.60psf as of August 1, 2019.
If I can be of further assistance,please do not hesitate to contact me.
Sincerely,
Keith O'Reilly,MAI
General Certified Appraiser
State of Montana#400
CERTIFICATION
As a result of a request for an appraisal assignment of the property, identified as:
Standard Property Valuation for the City of Bozeman's Cash in Lieu of Parkland
Dedication Process
I certify:
To the best of my knowledge and belief the statements of fact contained in this report are
true and correct. The reported analyses, opinions, and conclusions are limited only by the
reported assumptions and limiting conditions and are my personal, impartial, and
unbiased professional analyses, opinions, and conclusions.
I have no present or prospective interest in the property that is the subject of this report
and no personal interest with respect to the parties involved.
I have no bias with respect to the property that is the subject of this report or to the parties
involved with this assignment. My engagement in this assignment was not contingent
upon developing or reporting predetermined results. My compensation for completing
this assignment is not contingent upon the development or reporting of a predetermined
value or direction in value that favors the cause of the client,the amount of the value
opinion, the attainment of a stipulated result, or the occurrence of a subsequent event
directly related to the intended use of this appraisal.
My analyses, opinions, and conclusions were developed, and this report has been
prepared, in conformity with the Uniform Standards of Professional Appraisal Practice
and the requirements of the Code of Professional Ethics and Standard of the Professional
Appraisal Practice of the Appraisal Institute.
The use of this report is subject to the requirements of the Appraisal Institute relating to
its duly authorized representatives.
As of the date of this report, I,Keith O'Reilly,MAI,have completed the continuing
education program of the Appraisal Institute.
Heidi Switzer provided significant real property appraisal assistance to the person signing
this certification, including market research and input as to the final reconciled value.
Respectfully Submitted,
Keith O'Reilly,MAI
General Certified Appraiser#400
State of Montana
Bridger Appraisals Inc. O
Keith O'Reilly,MAI
Keith O'Reilly, NUI
State of Montana General Certificate 4400 Expires 3-31-:2019
QUALIFICATIONS
EDUCAnOMAPPRAISAL EDUCATION COURSES
• Educated in the Bozeman and Billings Public Schools Systems,Bozeman and Billings,MT.
• Obtained 3 B.S.degree in Business Marketing from Montana State University in 1992.
• Successfully completed the following courser and sernimam,from Appraisal Institute:
Courses from Appraisal Institute Seminars from Appraisal Institute
I 110&120 Appraisal Principles "The New URIAR"
1210,410&420Appr3is3l Principles 'High Tech Appraisal Office"
310 Basic Income Capitalization "Fundasnembl ofRelocation"
430 Standards of Professional Standards Pan C 'Understanding Limited Appraisals Residential'
510 Advanced Income Capitalization 'Understanding Li=Ld Appraisals General'
52.0 Highest&Best Use and Market Analysis `660-SmaLl HolelNllote:Valwtjon:'
530 Advanced Sales Comparison and Cost Approaches "6120-Nfixed Use Valuation Analysis"
540 Report Writing and Valuation Analysis 'Appraising Manufactured Housing"
550Advanced Application 'D=Contmiation and Verification Methods"
Business Ethics&Standards "Parnil Interest Valuation-Undivided"
Analyzing Operating Expenses "Appraisal Review General"
Forecasting Revenue "20162017—7hr USPAP Update"
APPRAISAL EXPERIENCE
I have specialized in the appraisals of residential and commercial properties located in Gallatin County,NIT since May of
199-2. My experience includes an apprenticeship with Henry Neils,MAI&Patrick Nolan,NLAL SRA-appraising residential
properties including -single family. 2-4 family, and condomimums, industrial sites and bufldings, commercial sites and
buildings,and insurable value appraisal,,-I have completed appraisal work for a var:tery of proposes including acquisition,
financing,consulting and litigation.
I am a native of Bozeman and have resided in the area for approximately 45 years.I served as a board member for the
Montana Board of Real Estate Appraisers firom.2001-2007 and was the Chairman ofthe Screening Panel Committee for the
Board of Appraisers.
I have completed work for the following:
Opportunity Bank-,Wells Fargo Bank,Rocky Mountain Bank First Interstate Bank,American Bank,Manhattan Bank,
Valley Bank of Belgrade,Big Sky Western Bank,Stockman Bank,Sterling Savings and Loan,First Security,Bank of
Bozeman,U.S.Bank-,Yellowstone Bank,Bozeman Deaconess Hospital.Burlington Northern Santa Fe Railroad,Washington
Mutual Bank,State of Montana and United States Government General Services Ad-i-i nation.and a variety of law officer,
both localliv and nationally.
State of{Montana This certificate verifies kensure as:
Business Standards Division CERTIFIED GENERAL APPRAISER
Board of Real Estate Appraisers Supervises:DANIEL WHEELER
Supervises:SHAWNA OOSTEMA
License#; REA-RAG LIC 400 Supervises:HEIDI SWITZER
Status: Active With endorsements of:
PEAL ESTATE APPRAISER!.MENTOR
Expiration Date: 03/31/2019
KEITH PATRICK O REILLY
BRIDGER APPRAISALS
147 MCGEE DR
PO BOX 11145
BOZEMAN,MT 59719
Bridges .Appraisals Inc.
Keith O'Reilly,MAI