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HomeMy WebLinkAboutLaw and Justice Center Appraisal and Offer from Gallatin CountyCounty Commission GALLATIN COUNTY 311 West Main, Rm. 306 Bozeman, MT 59715 Bozeman City Commissioners PO Box 1230 Bozeman, MT 59771 R): Law & Justice Center Appraisal and Offer Dear Commissioners: William A. Murdock Joe P. Skinner Steve White Phone (406) 582--3000 FAX (406) 582-3003 We are in receipt of the attached appraisal of the Law & Justice Center property. Enclosed please find a copy of the recently completed appraisal for the northwest portion of the Law and Justice Center location on S. 16th Avenue. We will be happy to use this appraisal as a basis for working with the City of Bozeman for construction of their Law Enforcement building, consistent with the master planning efforts for the site. It is in the public's best interest to keep the City Police Department and Courts within some sort of campus with similar county functions. We hope to work with you in achieving the goal of a shared campus as well as keep at the forefront that the passage of the upcoming jail bond issue is of utmost importance. Sincerely, GALLATIN COUNTY COMMISSION William A. Murdock, Chair -~i Joe P. kinner, Member . Stephen White, Member July 16, 2008 1 1 1 1 1 BRIDWELL APPRAISAL SERVICE, INC. SUMMARY APPRAISAL REPORT 5 ACRE PORTION LAW & JUSTICE CENTER LAND BOZEMAN, MT File: BAS 183 1 fl 1 fl 1 BRIDWELL APPRAISAL SERVICE, INC 1105 Baldy Mountain Ln. Belgrade, M'1' 59714 July 15, 2008 Mr. Larry Watson Gallatin County Grants & Frojects Administrator 311 E. Main St. Bozeman, MT 59718 Re: Summary Appraisal Report 5 Acre Portion of N W Corner Law & Justice Center Property 615 S. 16t" Ave. Bozeman, Montana 59715 Dear Mr. Watson: In accordance with your request for an appraisal of the Market Value of the captioned property as described herein, I hereby submit to you a report of 27 pages, exhibits and addenda that contain the data obtained in the investigation and the methods used to arrive at the final estimate of value. Your attention is directed to the Assumptions & Limiting Conditions contained herein. This is a summary appraisal report, which is intended to comply with the reporting requirements set forth under Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice (USPAP) for a Summary Appraisal Report. As a result of the investigation and analysis, it is the appraiser's opinion the Market Value of the ' Fee Simple Estate the subject property, as described herein and further conditioned on the stated Assumptions and Limiting Conditions included as a part of the appraisal, as of June 30, 2008, is: ' TWO MILLION FOUR HUNDRED THOUSAND DOLLARS ($2,400,000) ' Respectfully submitted, ~~~~ ~ ~" ~~/ William D. Bridwell ' Certified General Appraiser Montana License #686 L C 7 J ASSUMPTIONS & LIMITING CONDITIONS The estimate of value contained in this report is based on the following assumptions and conditions: 1) Title is assumed to be marketable. 2) The subject property is a five acre tract of land, which is situated at the northwest corner of the 19 acre parcel owned by the client, Gallatin County. It is currently occupied by two little league ball fields and includes a 30' wide access easement or extension of W. Dickerson St. The balance of the host parcel, some 14 acres +/- is currently improved with the Law and Justice Center complex including the County Detention Center. The appraiser has been requested to provide an appraisal of this S acre portion under the Hypothetical Condition that the subject parcel has been segregated, legally described. and is available to market as a separate parcel of unimproved land suitable for development. In addition, the existing L & J building and Detention Center are to be reconfigured and relocated on the remainder tract of land as indicated on the drawing provided and included in the Addenda of this report. The property is currently zoned Public Lands and Institutions District (PLI). Depending on the buyer, the zoning may have to be changed to allow private use commensurate with surrounding properties, i.e. RO or similar. It is assumed this would be a provision of any sale and becomes a part of this Hypothetical Condition. 3) The property has been appraised as though free and clear of all encumbrances. 4) No responsibility is assumed for legal matters especially those affecting title. 5) The information compiled and used in this report is believed to be fram reliable sources, but no responsibility is assumed for its accuracy. 6) No right of expert testimony is included. 7) The intended user/users of this report are limited to Gallatin County Commissioners, Gallatin County Grants & Frojects Administrator, and/or their assigns. 8) The function or use of the appraisal shall be to aid in or support decisions related to marketing the subject property for the benefit of the Gallatin County. 9) Possession of this report or a copy thereof does not carry the right of publication nor may it be used for any purpose by any but the intended users without the previous written consent of the appraiser or the applicant and then only with proper qualifications. 10) All information and conclusions concerning the subject property and other properties represent the personal opinion of the appraiser. While it is believed that the information, analyses and conclusions are correct, the appraiser does not guarantee them and assumes no liability for errors in fact, analyses or judgment. ii 11) The existence of toxic waste may be or may not be present in the property has not ' been considered by the appraiser. The appraiser is not qualified to detect such substances and, therefore, assumes no responsibility far such conditions. Na such contamination was noted at the time of inspection. ' d i it i d f d h s assume ere n; e ine 12) Ta realize the current market value of the property, as that reasonable financing could be made available to a prospective purchaser through a first lien or other acceptable financing. 13) The quality and integrity of the soil is unknown to the appraiser. It is assumed that ' there are no faults or conditions that would create unusual or extraordinary problems in the normal development of the property. 14) No responsibility is assumed for permits, zone changes, engineering ar any other services or duty connected with legally utilizing the subject property. ' 15) It is assumed the current access roadway, West Dickerson Street, would remain intact providing through access to the existing South 16th Ave. and balance of the Law & Justice Center facility as is and as proposed. J 1 1 ' w [] 1 1 u 1 1 J TABLE 4F CONTENTS Letter of Transmittal ..................................................................................................i Assurnptions & Limiting Gonditions ..............................................................................ii Aerial Phatagraph Table of Contents ......................................................................................................iv Summary of Salient Facts &Conclusions .........................................................................1 Purpose, Function & Scope of the Appraisal .....................................................................2 Subject Property ........................................................................................................4 Legal Description .......................................................................................................b Subject Photos Area Map Area Analysis ...........................•--•--...........................................................................7 STDB Demographics Neighborhood Map Neighborhood Analysis ...............................................................................................11 STDB Demographics Site Description ........................................................................................................12 Plat Map Flood Plane Map Ownership History &Taxes ........................................................................................13 Methods of Valuation ................................................................................................14 Highest & Best Use ...................................................................................................15 Sales Comparison Approach ........................................................................................17 Comparable Sales Map Reconciliation ..........................................................................................................25 Value Certification ....................................................................................................26 Qualifications of Appraiser ..........................................................................................27 ADDENDA ~~ 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 SUMMARY OF SALIENT FACTS Property Location: 615 S. 16`h Ave., Bozeman, MT Dimensions: Approximately 285' x 765' Site Size: Gross Area: 218,000 SF (5 Acres) Access Easement: 30' x 285' _ $,550 SF Net Site Area: 209,450 SF (4.81 Acres) Zoning: PLI (Major public and quasi-public uses outside of other districts) Zoning, If Required: RO or similar Purpose of Appraisal: Estimate the Market Value of the subject property. Interest Appraised: Fee Simple Estate Marketing Time: Less than one year Effective Date of Appraisal: June 30, 2008 Value Conclusion Cost Approach: N/A Income Capitalization Approach: N/A Sales Comparison Approach: $2,400,000 Reconciled Value: $2,400,000 u 0 1 PURPOSE, FUNCTION AND SCOPE OF THE APPRAISAL The purpose of the appraisal is to estimate the Market Value of the Fee Simple Estate of the subject property as of the effective date of the appraisal. The appraisal is made within the conformance guidelines as set forth by the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation. The appraisal will be used (function of the a raisal) to assist the client in making marketing decisions for the benefit of Gallatin County. Scope of the Appraisal An analysis of the area and neighborhood was conducted, and trends were identified which tend to influence the subject property. These trends and influences were used to estimate the highest and best use of the property, both as vacant and developed. The three standard approaches (The Cost Approach, Income Capitalization Approach, and the Sales Comparison Approach) were each considered; however, as the assignment was to estimate the market value of an unimproved tract of land, the Cost and Income Approach were not considered pertinent and were not developed. It is noted that a method within the Income Approach known as a developmental method is sometimes employed in estimating raw land value. This involves a design and estimation of development and marketing costs, which are deducted from an estimated gross sales value and then discounted over an estimated time period required to sell out. Architectural design and development cost estimates have not been obtained and a developmental approach is considered to be beyond the scope of this assignment. The Sales Comparison Approach is considered to provide the most credible indication value for unimproved land and was the only approach developed in this report. The analysis, opinions and conclusions presented within this report are based upon market data, as well as other sources considered pertinent to the assignment. The State of Montana is a non- disclosure state and market sale price information is not available as a matter of public record. Therefore, in compliance with USPAP, market sales and history have been researched through the Gallatin Association of Realtor's monthly Multiple Listing Service for the period of time that ' historical data is retained, which is a roximatel 36 m > pp y oaths, and/or data files of local Realtor s ' and appraisers. Market sales cited within this report were inspected by this appraiser and verified, either personally and/or by referencing the data source as noted within the report. ' Based on the most pertinent and reliable data indicated, a final value estimate was reconciled and concluded. ' Pro er Ri hts A r ' P ty g pp wised As noted, the purpose of the appraisal is to estimate the Market Value of the subject's Fee Simple Estate. Definition of Market Value ' The following definition of Market Value was taken from the Uniform Standards of Professional Appraisal Practice (USPAP) published by the Appraisal Foundation and the Financial ' Institutions Reform Recovery and Enforcement Act (FIRREA). Market Value is defined as follows: 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 undo stimulus. Implicit in this ' definition is that consummation of a sale as of a specified date and the 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 United States dollars or in terms of financial ' arrangements comparable thereto; and 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. ' Definition of Fee Simple Estate A Fee Simple Estate is the 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. Eff ' ectrve Date of Valuation: June 30, 2008 ' 3 0 1 n 1 1 SUBJECT PROPERTY The subject property is a 5 acre portion of an 18.94 acre tract of land currently improved with the Law and Justice Center Buildings and the County Detention Center and is located at 61 S S. 16~' Ave. It has access from South 19~' Ave. via W. Dickerson, which continues across the subject tract in the form of an access easement to the Law & Justice Center complex. This easement is approximately 30' wide and runs the width of site or 285' +/- and divides the subject into two useable parcels with a net area of approximately 209,450 SF or 4.81 acres of useable land area. (Reference the Aerials and Neighborhood Map included herein) The client, Gallatin County, is considering marketing this or a similar tract of land to the City of Bozeman to be used for a future police station, court house and other facilities. The existing Law and Justice Center and County Detention Facility are intended to be replaced by new facilities located in a different configuration with the Detention Center to occupy the easterly portion of the host site and separated from the subject five acre tract. This planned new configuration will, in the opinion of the appraiser, improve the marketability of this 5 acre piece for other uses, including the private sector, i.e. law offices or related facilities. It is recognized that private ownership would require a zone change, but conversations with Mr. Epple of the City of Bozeman Planning Office indicate that a zoning change from PLI to R-O would be considered a reasonable change to accommodate private ownership. It is noted there are other possible zoning change considerations, i.e. a PUD or a relatively new "Urban" zoning designation designed for "in fill" tracts of land. He noted that such a change would require a public hearing and approval of the surrounding land owners. For purposes of this report, it is assumed that if this parcel were to be marketed to the public, such a zone change would be a requirement of the sale and something the County would have to guarantee. It is noted that the reconfiguration of the L & J campus, which entails the relocation of the Detention Center and replacement of the existing L & J building is essential to the marketing of the subject parcel. This proposal will be voted on by the electorate this fall and the value conclusion of this report is based on the voter's approval of this plan. 1 1 C 1 The surrounding R-O zoned land is improved with apartments, professional office complexes, a neighborhood banking facility and a variety of neighborhood business buildings. The area to the north and east, which is zoned R-3, is improved with high density multi-family residential units and beyond that is a more established single family residential neighborhood. Originally, the subject property was owned and operated by the Roman Catholic Church as a parochial school facility. It was acquired by the county and converted to a Law & Justice Center and the County Detention Center was constructed later. The property lies just north of Montana State University Campus and approximately 3/4 mile southwest of Bowman's CBD. 19t" Ave. has become a primary arterial corridor providing ingress and egress to downtown Bozeman and to a major Interstate 90 Interchange. There was more available unimproved land within the corporate limits of Bozeman along the North 19t" section, As a result, it has and is continuing to experience significant commercial development in the form of "big box" retail outlets, restaurants and a variety of professional office and banking facilities. Land along South 19t" has recently been annexed to the city and is currently being developed into a relatively high density residential subdivision. The current slowdown within the residential market has inhibited development of the residential aspect of this development, but available commercially zoned land along this corridor is continuing to be purchased and developed. In summary, the subject property is well located adjacent to a newly configured Law & Justice Center with a new and repositioned County Detention Center. It is well located between the MSU Campus and Bozeman CBD and presents a variety of commercial use potential. The City indicates a willingness to favorably consider a zone change from public lands to a more marketable land use for private ownership. 1 ' Legal Description ' A legal description of the subject property was not provided the appraiser. The following is a compilation from the engagement agreement and the County Assessor's Office: ' A Five Acre Parcel of Land located along the west property line of Tract A & B of COS 691, Section 12, Township 2S, Range SE, together with a adjacent tract in the SW1/4 of the SWl/4 of Section 12, Township 2S, Range SE Containing 7,492 SF 1 0 f] 1 SUBJECT PHOTOS 1 Subject. Portion above W. Dickerson access. Looking northeast Portion of subject below Dickerson access. Looking east from Dickerson. 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Easement access from W. bickerson to L&J complex. Subject on right & Left. Aerial photo. Looking northeast 1 r C 1 1 1 Data use subject to license. TH _ Scale 1 : 30D,DDD 0 3 s ~ 2006 DeLOrme. 7op0 USA® 8.0. Mn n9.re~ v - - ~--.:6' ,a im www.delorme.com ~ 1" = 4.73 mi Data Zoom 9-4 1 1 J 1 1 AREA ANALYSIS The subject property is a 5 acre portion of the property known as 615 S. 16t" Ave. and is located within the corporate limits of the City of Bozeman. Specifically, the parent property, from which the subject is taken, is an 18.94 acre tract of land situated north of College St. and between S. 19t" Ave. and S. 1St" Ave. Bozeman and Belgrade comprise the economic base for Gallatin County, of which Bozeman is the County Seat. They both lay along Interstate 90, which is the primary east/west route across the state, with Belgrade being approximately 10 miles to the northwest of Bozeman. The area referred to as Four Corners is west of Bozeman and directly south of Belgrade where Huffine Lane (Hwy 191) and Jackrabbit Lane (SR 85) intersect. At this point Highway 191 continues south to Big Sky, MT, and Yellowstone National Fark. The overall area has experienced dramatic growth evidenced by an abundance of new construction both in residential and commercial development. History Bozeman was established in 1864, being on the "Bozeman Trail" to gold fields some 60 to 80 miles to the west. Cxallatin Valley was recognized for its agricultural potential by gold seekers who returned to the valley to farm and the Northern Facific Railroad followed with the cornpletian of its line through the valley in 1883. The town of Belgrade was established as a railroad community in 1882. Population Gallatin County gained the most new residents and had the second highest statewide growth rate between 1990 and 2000. Five of the state's fastest growing towns are in Gallatin County with Belgrade the fastest growing in the state. The latest report coming out of the U.S. Census Bureau, based primarily on building permits issued by local governments, indicates that one out of every three homes built in Montana aver a 12-month period ending last year was built in Gallatin County. These numbers may be skewed due to many counties in the state not issuing building permits; however it does reflect considerable growth and development in this area. Gallatin County added more than 1,800 housing units between July 1 of 2004 and 2005, 7 ' according to the census. The following table shows the comparative population and growth rates ' of the County and communities in the valley. Population Statistic Area 1990 2000 2004 (Est) Total Montana 799,065 902,195 926,865 15.9 Gallatin County 50,463 67,837 75,637 49.8 Bozeman 22,660 27,590 32,414 43 Belgrade 3,411 5,728 7,046 106.5 Manhattan 1,034 1,396 1,484 43.5 Three Forks 1,203 1,728 1,874 55.7 ' Economic Factors: The area's economic base is ane of the most diverse in the state, with Montana State University ' (MSU) and other government employment the largest single employer. Manufacturing, retail trade & services, and tourism & trade are also significant components of the economy. High ' Tech companies involved in software and manufacturing have become established in Gallatin Valley and are becoming a major contributor to the economic base. In fact, Gallatin County is ' now considered by many as the High Tech Center of the state. The fastest growing sectors continue to be tourism and recreation with airline boarding, skier days, fishing licenses and Yellowstone Park visits trending upward since 1990. Bozeman is also a regional trade center for a five county area. Median household income for Gallatin County has run approximately 15 to 20% higher than the ' statewide average and is currently near $40,000. Non-farm labor income is forecast to increase 2.8% to 3.7% per year over the next five years. Unemployment has averaged below 3% for ~ . J 1 1 several years now and nearly every sector of the economy has experienced a dramatic increase in activity over the past decade. Countywide construction activity, as indicated by building permits, began trending upward since 1992. This was fueled by a movement of investment monies from the stock market into real estate and the lowest mortgage rates in a quarter of a century. Residential construction began to accelerate and has only recently begun to level out. In the last several years we have experienced a steady increase in commercial construction, particularly in the Bozeman, Belgrade and Four Corners areas. According to the City of Bozeman Planning & Community Development, the city annexed mare than 186 acres in 2003 and over 3,600 acres since 1990, which represents a 59% growth in 14 years. Fueled by an ever-increasing demand for housing and commercial services, same 48-subdivision applications were processed in 2003, resulting in a creation of some 564 lots, of which 390 were designated for single-family structures. Bozeman County Commissioners have been inundated with requests for new subdivision approval and the latest report indicates something over 10,000 residential sites were expected to be coming on the market within the next year. In the last quarter of 2007, we have seen a leveling off in the residential real estate market. Nationally, mortgage lenders have begun to tighten their underwriting, which should cool the high rates of annual. appreciation that have been experienced in this real estate market over the past few years. The local perception is fueled by the national condition of the housing market. This is aggravated by the quantity of foreclosures, particularly in the subprime market where unqualified buyers are unable to meet the additional expense of adjustable rates moving up. The subject area does not seem to be experiencing a comparable foreclosure situation, however, the current inventory is over stocked and buyers are proceeding cautiously. In summary, current population trends in the subject area suggest a continued demand for products and services and corresponding residential and commercial development. However, the national housing market and the overall economy will have a leveling effect on our local market and marketing times will probably increase. The population is relatively young, well educated, with above average purchasing power. In addition the local economy is one of the most diverse in the state with governmental employment as the anchor. This should provide above average protection from severe economic downturns and encourage continued growth. The national 9 ' economy appears on the edge of recession, reflecting concern aver a the inordinate high foreclosure rate in residential properties financed in the subprizne market as well as ever increasing energy costs. However, the local area market appears to be stabilizing from a dramatic growth spurt to a much more realistic supply and demand status. National concerns, i.e. falling value of the dollar, high price of grain, etc. may prove to enhance Montana's economy. The economic projections for this area for the taming year appear reasonably stable. ' ~o 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 '~ ~- Gvurities: Gallatin, MT Demographic and Income Profile -appraisal Version Prepared by Summary 2000 2DD7 Population 67,831 84,457 Households 26,323 33,029 Families 16,196 19,641 Average Hvusehaid Size 2.46 2.46 Owner Occupied HUs 16,434 20,651 Renter Occupied HUs 9,889 12,378 Median Age 3D.9 31.6 Trends: 2007-2012 Annual Rate Area Populatnn 3.25% Househclds 3.38% Families 2.84°~ Owner HHs 3.4°/v Median Household Income 3.05% zooD zaD7 Households by Income Number Percent Number Percent ~ $15,000 3.760 14.3 % 3,651 11.1% $15,000 - $24,999 3,996 15.2°k 4,044 12.2% $25,OOD - $34,999 4,113 15.6%v 3,924 11.9% $35,OD0 - $49,999 5,215 19.8% 6,205 18.8% $50,OOD - $74,999 5,019 19.0°l0 7,317 22.2% $75,000-$99,999 2,157 8.2% 3,559 10.8% $100,D00-$149,999 1,405 5.3% 2,895 8.$% $15p,000 - $199,DD0 375 1.4%v 738 2.2°/v $200,OD0+ 317 12%v fi98 2.1 %v Median Household Incnme $38,111 $46,248 Average Household Income $48,302 $59,631 Per Capita Income $19,074 $23,724 zaDD zoD7 Population by Age Number Percent Number Percent 0 - 4 3,935 5.6% 4,964 5.9°/n 5 _ g 4,D29 5.9%v 4,511 5.3% 1D - 14 4,32$ 6.4 % 4,357 5.2% 15 -19 6,002 8.8% 6,627 7.8% 20 - 24 9,187 13.5% 10,548 12.5% 25 - 34 1D,059 14,8% 14,955 17,7 % 35 - 44 10.588 16.6°k 9,967 11.8% 45 - 54 9,308 13.7% 13,498 16.0% 55 - 64 4,645 6.8°/n 7,$31 9.3°/v 65 _ 74 2,982 4,4% 3,778 4.5°/v 75 - 84 2,085 3.1 % 2,41 D 2.9 $5+ 703 1.0% 1,011 1.2% Rata Note: Income is expressed in current dollars. Source: U.S. Dureau of the Census, 2000 Census of Population and Housing. FSRI forecasts for 2007 and 2012 2012 99,081 39,002 22,597 2.46 24,404 14,596 33.4 National 1.22°/n 1.27% 1.00% 1.29° 3.29% 2012 Number Percent 3,651 9.4°/n 3,881 10.0% 3,813 9.8% 6,578 16.9% 8,731 22.4°/v 5,020 12.9°k 4.736 12.1°k 1,317 3.4% 1,275 3.3% $53,145 $70,204 $28,025 2D1z Number Percent 5,805 5.9% 5,223 5.3°/n 5,35D 5.4%v 6,904 7.0°/n 12,479 12.6% 16,615 16.8% 11,587 11.7% 14,7D6 14.6% 11,463 11.6% 4,993 5.0°/v 2,662 2J% 1,294 1,3% X2007 FSRI On~amand reports and maps from Business Analyst Online. prder at www.esri.com/tree or ca11800-292-222b 5/15120tl8 Page 1 of 2 '~ Demographic and Income Profile -Appraisal Version •:.:~ Prepared by Counties: Gallatin, MT yc U N a c i~ rz m c c Q Trends 2007-2012 3.5 3 2.5 z Area t 6 [.~ U.S. 1 0.5 0 Pope atron Households Families Owner HHs Median WH Income Population by Age c a~ v N t7. 2007 Household income $75K-99K (10.8%a) $100K-$149K (8.8%) $150-199K+ (2,2%) $SOK-74K (22.2 %) \ ~$15K (11.1%) $35K$49K (1 ~ -9°~ ) Source: E5RI iprecasts for 20D7 and 2D12. (1z.z%) 0 2007 2012 @200T ESRI pmdemand reports and maps from Husiness Analyst Pnline. Order at ~ or call SOtl•292-222b 5/15!2008 Page 2 of 2 t 1 1 1 u 0 Data use subject to license. TM Scale 1:28,125 °~-_-- ieoo z~ao _ ~z~eooo ~._....._..__ n ® 2006 DeLorme. Topo USAF 8.0. r MN (1]d•[) u ~w - ~ ew aw ~~ m ~I. .. www.delorme.com 1" = 2,343.8 ft Data Zoom 12-7 NEIGHBORHOOD ANALYSIS The subject neighborhood includes the area within the City Limits of Bozeman south of Main St., west of Bowman's CBD and east of Gallatin Mall. This area includes the MSU campus and the South 19th Ave. corridor. The subject property is a 5 acre portion of 1$.94 acres of unimproved land that is zoned PLI and R-O and is situated just behind ar to the east of the line of properties fronting S. 19th Ave. It is currently being utilized for two little league ball fields. As proposed, the existing improvements of the Law & Justice Center and the County Detention Center are to be removed, reconfigured and relocated on the remainder parcel of approximately ' 14 acres. The majority of land in this neighborhood is zoned for either community business or high density residential and is approximately 95% improved with a mixture of professional offices, neighborhood business and multi-family residences. The subject is an interior tract of land adjacent to the Law & Justice Center Campus and is surrounding by the above listed uses. (Reference is made to the Neighborhood Map and Aerial Photos included herein) Nineteenth Avenue runs north from approximately five miles south of the city limits along the west side of the MSU Campus, through the west section of the city and joins Interstate 90 approximately two and a half miles north of Main St. It has become a primary ingress/egress corridor for Bozeman and handles a relatively high volume of vehicular traffic. As such, available land fronting and in close proximity to this arterial have become quite marketable and it continues to develop commercially. The development on the south side of 19th Ave. is primarily neighborhood office and business space in compliance with the zoning along this stretch of the corridor. In summary, the subject property is situated within a neighborhood that is relatively built out with existing high density residential and neighborhood office and business facilities. This tract has access from 19th Ave. via W. Dickerson, is in close proximity to the MSU campus and is relatively convenient to the Bozeman CBD. 1 1 1 1 1 1 1 1 1 Demographic and Income Profile -Appraisal Version Prepared ey Places: Bozeman city, MT Summary Population Households Families Average Household Size Owner Occupied HUs Renter Occupied HUs Median Age Trends: 2008-2013 Annual Rate Population Households Families Owner HHs Median Household Income Households by Income ~ $15,000 $15,000 _ $24,999 $25,000 - $34,999 $35,000 - $49,999 $50,000 - $74,999 $75,000 - $99,999 $100,OD0 - $149,999 $150,000 - $199,000 $200,000+ Median Household Income Average Household Income Per Capita Income Population by Age 0-4 5-9 10 - 14 15 - 19 20 - 24 25-34 35 - 44 45-54 55 - 64 65 - 74 75-84 85* 2000 27,509 10,877 5,019 2.26 4,663 6,214 25.5 Area 2.74% 2.97% 2.35% 2.72% 3.74% 2D00 Number Percent 2,191 19.9% 2,001 18.2% 1,835 16.7% 2,D4$ 18.6% 1,727 15.7% 675 6.1% 388 3.5% 103 0.9% 33 D.3% $31,955 $39,173 $16,104 2000 Number Percent 1,366 5.0% 1,120 4.1% 1,185 4.3% 3,184 11.6% 6,621 24.1% 4,701 17.1% 3,16$ 11.5% 2,7$1 10.1% 1,183 4.3% 885 3.2% 913 3.3% 402 1.5% 2D08 33,439 13,483 6,103 227 6,260 7,223 27.1 zoos Number Percent 1,808 13.4% 1,947 14.4% 1,62$ 12.1% 2,457 18.2% 2,902 21.5°k 1,394 10.3% 902 6.7% 241 1.8% 2D1 1.5% $42,999 $53,651 $22,267 2D08 Number Percent 1,651 4.9% 1,328 4.0% 1,417 4.2% 3,497 10.5% 7,369 22.Q°/a 5,569 16.7% 3,444 10.3% 3,810 11.4% 2,369 7.1% 1,320 3.9% 1,103 3.3% 563 1.7% Data Note: Income is expressed in current dollars. Source: U.S. Bureau of [he Census, 2000 Census of Population and Housing. ESRI forecasts for 2008 and 2013. 2013 38,273 15,607 6,853 2.27 7,159 8,448 27.5 National 1.23% 1.26% 1.05% 1.07% 3.19% 2013 Number Percent 1,690 10.8% 1,632 10.5° 1,900 12.2% 2,297 14.7% 3,847 24.6% 2,079 13.3% 1,380 8.8% 391 2.5% 392 2.5% $51,656 $63,202 $26,269 2013 Number Percent 1,950 5.1% 1,521 4.D% 1,614 4.2% 3,731 9.7% 8,377 21.9% 6,126 16.0% 3,917 10.2% 4,279 11.2% 3,0$6 8.1 1,734 4.5% 1,243 3.2% 692 1.8% ®20D8 ESRI On-demand reports and maps from 9usiness Analyst Qnline. Order at www.e~,rl.com/bao or call 800.292-2224 7/11/2008 Page 1 of 2 1 1 1 1 1 1 1 1 1 1 1 1 Demographic and Income Profile -Appraisal Version Prepared by Places: Bozeman city, MT Trends 2008-2D13 Population by Age 2008 Household Income $50K-74K (21 ~35K-$49K (18.2 II 5ourco ESRI forecasts for 2D08 and 2013. (6.~%) K+ (1.8 % ) (1.5%) SK (1 (14.4 % ) ©2008 SRI On-demand reports and maps from Business Analyst pnllne. Order at>~1tRy,BSri.com/baa or call 800-292-2224 7/11/2008 Page 2 of 2 1 C SITE DESCRIPTION The subject is an unimproved rectangular shaped tract of land containing approximately S acres. An access easement from W. Dickerson, which crosses the site to the Law & Justice facility is approximately 30' by 28S' and effectively reduces the useable land area from S acres to 4.81 acres more or less. The subject tract is an unimproved parcel which is part of the County Law & Justice Center and is currently utilized for two little league ball parks. It had originally been awned and operated as a school by the Raman Catholic Church. It was acquired by the county and converted into the Law and Justice Center and later, the County Detention Center was constructed on the site. For an interim period of tune a police training facility was located on the site, but these buildings were removed and the site restored in the late 90's. This report assumes that this parcel is segregated from the parent tract and is marketable with zoning for the private market of RO or comparable use, as of the effective date of this appraisal Zoning PLI: Major public and quasi-public uses outside of other districts. (Current zoning) R-O or similar: High density residential office district. (Hypothetical Condition) Easements The subject parcel will give an access easement (30' x 28S' +/-) to the Law & Justice Center complex, which will be an extension of W. Dickerson St. Other easements are estimated to be normal utility easements. Utilities All city utilities, including sewer and water, are available to the subject property ~~,.,.a n~..:.. According to FEMA Panel #300028001SC dtd 7/1S/1988, the subject is not within a flood plain. (See lnsert) Site Utility The subject relatively level, virtually cleared except for two little league ball fields and has full utility, subject to development requirements. 12 ~ a le I"=100' a9°u'~" w. S 89° Q3" 4B° w b/~ R~bor 87 41 5/e raeor 37p.12 I r f~B~~'~~ ~P~~~X ' ~ ~ 3 ~~~E ' ~ l TRAGT o ~ 15. ?72 acres ,~ ~ w 0 I ~_ ~ ~ 0 ~ l W O_ fl 4 ~ •- 1 1 1 1 1 N. 88° 5fr~ 04" E . j~~ y r /y.¢-rte 3ED > marked 8AB8 asx~~s RICHARD'S SUBDIVISIpN 1° %p~ ~~ ~ -.,~: 1 OI.42 TRACT B REMAINDER 3.Od0 acres ~xo.oO N. $"'" gg.~.~"' F 0 C asr Ia7.3~a 8 ~ RQMAN CATMpLiC B15NGP of HEL~N11, a 0 F- . ~ W X a x9~ 7; AI'QLI.p SUBp, ,- ~ ~~ ~~' N.89 09 67 E. 5'iE N 829'9 "~- ~I t. PROPERTY ADDRESS: ~~~~ N ~(N E.cam 575 S 16th Ave, Bozeman, MT 59715 `'~ FLOODSOURCE,~ ' FLrIppSCAPE - ,;. ~ --~~ V ~a aoa~ ~ ~~ ~ . Sao ~a c 3000 ) ~ NOrth ~-- ' ti z ~ ~ r-, ' ~ --^~ ~' CpRpy 47F • ! I ~ I ~"""~r~r8 i ,~_ ^+4 . ter.^-~•~~ ' err CgftPC1RA7E •~~- ~ 1 1 ~w 1 ~ ~ ~ "-" `~~ µ ~ Ills LIMITS Jt-.~f _. _ --. ~ m ~'~`'•' ~ F C L MITSTB t_ ^~ ~ ~a `l I R rr ~~~...111 ~ '~ ~~' h,~r• Q ~; ~ 1... 4ll_..~~~ it r. ae r, ~ ~ _.~. J lll......... I~ ~ w_. BUR ~~ ~a oat z c -.-~---; - n. ....- .. _• boa ~ c a -~ w ~~ 1• =' ~ORPQRATE ! ~ ~IMI'r5 k rl CCCIRPORATF r LIMITS ~ ~ ~ 4 ,,,,, W~ ~ _.. W ,..~.: CORPpRA THIS ARFA IS SHOWN L"~'TS Flood Hazards Map OM PANEL 300028 001 C~ .I "~ C Map Number ' • 30008 0015 C ~ ~ . ~` 0 S 0016 C sooo2BOO11c Effective Date y ~p4 July 15, 1988 ' .x _ F LlMI ~Pr,rh.•.r ,r.,~ r•~,. ~ Flood Legend °' Nigh flood risk ~~ ^ Moderate fltwd risk ._...~ '" - . -... ~ ~ Low flood risk 'I C ;9 ST f K ~' ~` This repptt makes nn ' } - .. ~"" ~ tiyi~k -,ti)rr-rr~e~ I regreser,tedonsorw®rtanties ~ 1 (•744' ~ WnClR,InQ It3 content, aocurmLy i I Of comgleter,ess. ~ ~ f STDBonltne.com 469.574.1234 azs 0020 c ~ 3aooxs eats c - - --- -- --- Powered by ~IcadSou[Cc •• -' -- - ' 1.,. ~ ~ en.Tr.FLaoo ......... _......-----...__ ~ ,Nww.npodsource.com ~ ~ l-- y ..__r.._ _ .-.__, _.. ~ iggg~2pp7 SourceProse Corporatlon. All rights reserved- Protected 6y U.S. Patent Numbers 6631328, 6678615, 6842698, 8nd 7p38681. 1 1 1 t OWNERSHIP & TAXES According to Gallatin County Treasurers Office, the subject property is currently listed under the following ownership: Tax ID Ownership Size 2006 Tax Val RGG33751 Gallatin County 15.772 Acres N/A RGG5237 Gallatin County 3 Acres $66,399 RGG5236 Gallatin County 0.172 Acres 10 215 Total; 18.944 Acres $76,614 Plus N/A Status: Exempt 13 ' INFQRMATION UPDATED.. January 31, 2008 General Parcel Tnformativn definitions GEOCODE 06079812313010001 ' OWNCODE 40000 OWNER CLASSIFICATION Local Government ' COUNTY ASSESSOR CODE OORGG33751 SECTION 12 TOWNSHIP T02SROSE ' LEGAL DESCRIPTION LAW JUSTICE CENTER SEC 12 2S SE PROPERTY ADDRESS ' MUNICIPALITY ADDITION-SUBDIVISION BOZEMAN LEVY DISTRICT COUNTY LEVY DISTRICT ' LEVY DISTRICT NAME :TOTAL I'INAL LAND VALUE $0.00 E!!t Ilan tiara TOTAL FINAL BUILDING VALUE $0.00 Ex~rlanatic-n 2003 FULL REAPPRAISAL VALUE $0.00 _N~:xr~lana_titn 2007 TA\ABLE MARKET VALUE $0.00 E?xplana~_tgn DEED 1: BOOK, PAGE, DATE (mmddyy) „ OWNER NAME 1 CALLATIN COUNTY ' TAXPAYER MAILING ADDRESS GENERAL DELIVERY BOZEMAN, MT 59718-9999 ' SITE INFORMATION clc~fintio~t CAMA Cade, ' Characteristic (Description) GEOCODE 06079812313010001 NEIGHBORHOOD ' NEIGHBORHOOD TREND RESIDENTIAL INDICATOR ' ACCESS I'RONTING ~: LOCATION ' TOPOGRAPHY UTILITIES IMP1tOVEMENTS TO TAE LAND defir~iti~ans METHODS OF VALUATION The appraisal process customarily utilizes three separate approaches in the valuation of real ' property. When sufficient data is available, an indication of value is developed for the property being appraised from each approach. The indications of value are then summarized and ' reconciled into a final estimate of value. The three approaches are: ' Cost Approach Income Capitalization Approach ' Sales Comparison Approach A brief summary of the different approaches to value is as follows: Cost Approach: The Cost Approach considers the cost of development as of the effective date of the appraisal, ' less the estimated accrued depreciation, plus the indicated land value. ' Income Capitalization Approach: The Income Capitalization Approach is a means of estimating the present worth of the income ' produced by a property in the future. The indication of value is computed by capitalizing the net income stream into value. Discounted Cash Flow (DCF) is a method within the Income ' Capitalization Approach that discounts an estimated series of cash flows to be received in the future in order to estimate the present worth of those cash flows. Sales Comparison Approach: ' The Sales Comparison Approach is a method of estimating the market value of a property by comparing similar properties and prices paid in actual market transactions. This approach was ' considered to be the only credible approach within the scope of this report for estimating the value of the subject property, subject to the reconfiguration and relocation of the current Law & ' Justice Center and Detention Facility. ' 14 HIGHEST & BEST USE Real Estate Appraisal_ Terminol~y (by the American Institute of Real Estate Appraisers) defines the highest and best use as: ' ~A~ 1 That reasonable and probable use that supports the highest present value, as defined, as of the effective date of the appraisal. (B) Alternatively, that use, from among reasonably probable and legal alternative uses, found to be physically passible, appropriately supported financially feasible, and which results in highest land value. (C) The definition immediately above applies specifically to the highest and best use of land. ' It is to be recognized that in cases where a site has existing improvements an it, the highest and best use may very well be determined to be different from the existing use. The existing use will continue, however, unless and until land value in its highest and best use exceeds the total value of the property in its existing use. (D) Implied within these definitions is recognition of the contribution of that specific use to ' community environment or to community development goals in addition to wealth maximization of individual property owners. ' (E) Alsa implied is that the determination of highest and best use results from the appraiser's judgment and analytical skill, i.e., that use determined from analysis represents an opinion, not a fact to be found. In appraisal practice, the concept of highest and best use represents the premise upon which value is based. In the context of mast probable selling price (market value), another appropriate term to reflect highest and best use would be mast probable use. In the context of investment value an alternative term would be "most profitable use." As Unim raved ' The subject is a 5 acre tract of land adjacent to the Gallatin County Law & rustice Center complex, which includes the Caunty Detention Center. It is surrounded by a mixture of ' neighborhood office and/or business facilities and high density multi-family residential buildings and is well located off a major arterial corridor (19`" Ave) between the MSU Campus and ' Bozeman's CBD. It is currently owned by the county and is zoned PLI for public use. The City Planning Office would favorably entertain an application for zoning change to something ' consistent with the existing neighborhood use and if marketed to a private ownership, it is a condition of this report that this parcel would be rezoned to an RO or similar designation. The 15 City of Bozeman is considering acquiring this parcel to relocate their Police and City Court ' facilities. Based on the current zoning of the subject and its proximity to the County L& J facilities, this appears to be the Highest and Best Use of the subject parcel, as unimproved. In the event, the property is marketed to the public, the Highest and Best Use, as unimproved, would be to rezone and develop the site with office space for uses that would be consistent with ' the legal activities of the county and/or service oriented businesses. ' As Improved The subject property is currently being utilized for two little league ball Melds and is virtually unimproved. Based on the above analysis, the Highest and Best Use would be to develop the property as described above, depending on the eventual ownership. 1 1 ' 16 SALES COMPARISON APPROACH The Sales Comparison Approach is a method of estimating the value of land by comparing ' similar properties being offered and actual prices paid in market transactions. The method is dependent upon the comparability of each property with the property being appraised, time of ' sale, the verification of sale, and the absence of any unusual conditions affecting the sale. The State of Montana is anon-disclosure state, in that sales data is not a matter of public record. ' Therefore, the appraiser had to rely an market data obtained from the Multiple Listing Service of the Gallatin Valley Association of Realtors, appraisers and other information available to the ' appraiser. ' An investigation was made of sales and offerings of similar unimproved tracts of land within the vicinity of the subject and the following sales are cited: 0 1 0 17 1 1 Location: TBD Valley Commons Dr. Grantor: Zander Enterprises Date of Sale: 9/17/07 Land Size: 49,658 SF (1.14 Acre) Zoning: BP (Business Park) Price: $747,500 Price/SF: $15.05 Price/AC: $655,701 Terms: Conventional Financing Source: MLS #130923 & Agent Remarks: This is a well located site in an established business park approximately 1.25 miles west of the subject and just west of the Gallatin Valley Mall. 18 COMPARABLE LAND SALE NO. 1 0 1 COMPARABLE SALE N0.2 Location: Lot 1, Block 2 Meadow Creek Grantor: Meadow Creek Fartners, LLC Lot Size: 97,139 SF (2.23 Acres) Zoning: R-4 High Density Price: $866,250 Price/SF: $8.92 Price/AC: $388,453 Terms: Cash or Equivalent Source: MLS #138008 & Agent Remarks: This is a large corner site located at the north end of a new subdivision within the city limits in the southwest section of Bozeman close to the MSU Campus. 19 1 1 1 1 COMPARABLE SALE N0.3 Location: Lot 2, Blk 2 Meadow Creek Grantor: Meadow Creek Partners, LLC Date of Sale: 7/14/08 Lot Size: 111,949 SF (2.57 Acres) Zoning: R-4 High Density Price: $800,000 Price/SF: $7.1 S Price/AC: $311,284 Terms: Cash or equivalent Source: MLS #138125 & Agent Remarks: This sale is located adjacent to comparable #2 and was purchased by the same buyer for future development into residential condos. zo