HomeMy WebLinkAboutStory Mansion AppraisalSUMMARY APPRAISAL REPORT OF:
A 2.147 ACRE SITE IMPROVED WITH
A 9,594 SF HISTORIC MANSION AND
A 4,680 SF CARRIAGE HOUSE AT
811 SOUTH WILLSON AVENUE
BOZEMAN, MONTANA
PREPARED FOR:
Chris Kukulski
City Manager
City of Bozeman
121 North Rouse Street
Bozeman, Montana 59771
MARKET VALUE AS OF:
January 30, 2014
PREPARED BY:
Sandra S. Kennedy & Elliott M. Clark, MAI
Clark Real Estate Appraisal
6477 US Highway 93 South, #509
Whitefish, Montana 59937
(406) 862-8151
Clark Real Estate Appraisal (14-006es) (01/30/2014) 2
6477 US Highway 93 South, # 509
Whitefish, Montana 59937
LETTER OF TRANSMITTAL
March 17, 2014
Mr. Chris Kukulski
City Manager
City of Bozeman
121 North Rouse Street
Bozeman, Montana 59771
Re: Summary Appraisal Report of a 2.147 Acre Site Improved with a 9,594 square foot Historic
Mansion and a 4,680 square foot Carriage House at 811 South Willson Avenue, Bozeman,
Montana
Dear Mr. Kukulski:
In compliance with your request Sandra Kennedy of Clark Real Estate Appraisal viewed the subject
property on January 23rd, 2014, accompanied by Sid Bush, City of Bozeman Facilities Services
Technician. Additionally, Sandra Kennedy and Elliott M. Clark viewed the subject property on
January 30th, 2014, again accompanied by Mr. Bush. Applicable information regarding zoning was
reviewed and trends in real estate activity in the area and throughout the state were researched and
analyzed. We conducted a search for comparable sales. The visual inspection, review, searches, and
analyses were made in order to prepare the attached summary appraisal report.
There are three approaches to value in the appraisal of real property. They are the Cost, Sales
Comparison and Income Approaches. All three approaches and their applicability will be discussed
in greater detail in the Scope of the Appraisal section of this report.
The value of the encumbered fee simple interest in the subject property is determined in this report.
The opinions of value were developed after a thorough study of available market data and other data
felt to be pertinent to this appraisal.
The attached summary appraisal report exhibits the factual data found and reasoning used in forming
our opinion of value. The value is based on the assumption that all necessary governmental approvals
have been obtained and will be maintained and that the property owners will exhibit sound
management and sales practices.
Telephone (406) 862 -8151 www.clarkappraisal.us FAX (406) 862 -8394
Clark Real Estate Appraisal (14-006es) (01/30/2014) 3
We were not provided with soil studies for the subject property. We assume that the soils are
capable of supporting construction similar to that in the neighborhood without unusual soil
preparation.
We certify that, to the best of our knowledge and belief, the statements and opinions contained in
this appraisal report are full, true and correct. We certify that we have no interest in the subject
property and that neither the employment to prepare this appraisal nor the compensation received
is contingent upon the value estimate of the property.
This appraisal assignment was not made nor was the appraisal rendered on the basis of requested
minimum valuations or specific valua tions. This appraisal is subject to the attached Certification
of Appraisal and Statement of Limiting Conditions. We further certify that this appraisal was made
in conformity with the requirements of the Code of Professional Ethics of the Appraisal Instit ute
and the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation
(USPAP).
Respectfully submitted,
Elliott M. Clark, MAI
Montana Certified General Real Estate Appraiser
REA-RAG-LIC-683
Sandra S. Kennedy
Montana Certified General Real Estate Appraiser
REA-RAG-LIC-758
14-006es
Telephone (406) 862 -8151 www.clarkappraisal.us FAX (406) 862 -8394
Clark Real Estate Appraisal (14-006es) (01/30/2014) 4
TABLE OF CONTENTS
CERTIFICATION OF APPRAISAL ...................................................................................................... 6
GENERAL ASSUMPTIONS & LIMITING CONDITIONS ................................................................ 8
SCOPE OF THE APPRAISAL.............................................................................................................. 10
IDENTIFICATION OF THE SUBJECT PROPERTY ....................................................................... 14
DATE OF INSPECTION ....................................................................................................................... 14
EFFECTIVE DATE OF MARKET VALUE ........................................................................................ 14
PROPERTY RIGHTS APPRAISED .................................................................................................... 14
PURPOSE OF THE APPRAISAL ........................................................................................................ 15
INTENDED USE OF THE APPRAISAL ............................................................................................. 15
CLIENT & INTENDED USER(S) OF THE APPRAISAL ................................................................. 15
DEFINITION OF MARKET VALUE .................................................................................................. 15
HISTORY OF SUBJECT PROPERTY & STATEMENT OF OWNERSHIP .................................. 16
PROPERTY DESCRIPTION ................................................................................................................ 20
A. GENERAL SITE DESCRIPTION ...................................................................................................................... 20
B. ACCESS & PARKING ...................................................................................................................................... 23
C. ZONING ............................................................................................................................................................ 24
D. ASSESSMENT/PROPERTY TAXES ................................................................................................................ 28
E. IMPROVEMENTS ............................................................................................................................................ 28
F. EASEMENTS, BUFFERS, RESTRICTIONS, AND ENCROACHMENTS ........................................................ 32
G. TOPOGRAPHY, VEGETATION, & ENVIRONMENTAL CONSIDERATIONS ............................................. 34
H. UTILITIES ........................................................................................................................................................ 34
I. PUBLIC SAFETY AND SERVICES ................................................................................................................... 34
J. HISTORIC SIGNIFICANCE .............................................................................................................................. 34
K. SITE SUITABILITY .......................................................................................................................................... 35
SUBJECT PHOTOGRAPHS ................................................................................................................. 41
SUBJECT MARKET ANALYSIS-HISTORIC HOMES IN MONTANA ......................................... 62
MONTANA HISTORIC MANSIONS PHOTOGRAPHS ................................................................... 65
SWOT ANALYSIS ................................................................................................................................. 74
HIGHEST AND BEST USE................................................................................................................... 75
CONSIDERATION OF FOUR PROPOSALS ..................................................................................... 82
THE APPRAISAL PROCESS ............................................................................................................... 83
COST APPROACH ................................................................................................................................................ 84
SALES COMPARISON APPROACH .................................................................................................................... 97
RECONCILIATION OF VALUE INDICATIONS ............................................................................................... 112
QUALIFICATIONS OF THE APPRAISER ...................................................................................... 113
APPRAISERS LICENSES ................................................................................................................................... 116
ADDENDUM ........................................................................................................................................ 117
NATIONAL ECONOMIC DATA ........................................................................................................................ 118
STATE ECONOMIC DATA ................................................................................................................................ 118
GALLATIN COUNTY DATA ............................................................................................................................. 119
CITY OF BOZEMAN DATA ............................................................................................................................... 122
ENGAGEMENT LETTER ................................................................................................................................... 128
SUBJECT DEED.................................................................................................................................................. 134
REFERENCES ..................................................................................................................................................... 135
Clark Real Estate Appraisal (14-006es) (01/30/2014) 5
SUMMARY OF SALIENT DATA AND CONCLUSIONS
IDENTIFICATION OF CLIENT/INTENDED USE
Clients/Intended Users
City of Bozeman
Purpose/Intended Use Estimate Market Value for possible marketing purposes
Property Owner City of Bozeman
SUBJECT PROPERTY
Property Addresses
811 South Willson Avenue, Bozeman, Montana
Site Size(s) 2.147 Acres (As Assembled)
Description of Improvements See Property Description
Assessor Number(s) 000RGH4399 and 00RGH62664
Census Tract 30 031 0011.02
Flood Zone Area of Minimal Flood Risk (Map Panel 30031C0816D – Dated
09/02/2011)
Zoning R-1 Residential Single-Household Low Density
HIGHEST AND BEST USE(S)
As If Vacant
Residential Subdivision Development
As Improved Single Family Residence
DATES, VALUE CONCLUSION(S) AND ASSIGNMENT CONDITION(S)
Report Date
March 17, 2014
Inspection Date(s) January 23, 2014 and January 30, 2014
Effective Date of Value(s) January 30, 2014
Property Rights Appraised Encumbered Fee Simple Interest
Estimate of Market Value
$1,540,000
Extraordinary Assumption(s) See Scope of Work
Hypothetical Condition(s) None
MARKETING TIME
The appraised value is based upon an approximately 9 to 12 month marketing period. Marketing time is addressed
in detail in the Subject Market Analysis portion of this report.
APPRAISER INFORMATION
Appraiser(s) Sandra Kennedy & Elliott M. Clark, MAI
Clark Real Estate Appraisal (14-006es) (01/30/2014) 6
CERTIFICATION OF APPRAISAL
We certify that, to the best of our 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 our unbiased professional analyses, opinions,
and conclusions.
Elliott M. Clark, MAI and Sandra S. Kennedy 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.
We have not performed services as appraisers regarding the property that is the subject of
this report within the three -year period immediately preceding acceptance of this
assignment.
We have no bias with respect to the property that is the subject of this report or to the
parties involved with this assignment.
Our engagement in this assignment was not contingent upon developing or reporting
predetermined results.
The compensation for completing this assignment is not contingent upon the development
or reporting of a predetermined values or directions in value that favor the cause of the
client, the amounts of the value opinions, the attainment of stipulated results, or the
occurrence of a subsequent event directly related to the intended use of this appraisal.
Our analyses, opinions, and conclusions were developed, and this report has been prepared,
in conformity with the requirements of the Uniform Standards of Professional Appraisal
Practice.
Sandra S. Kennedy and Elliott M. Clark both viewed the subject property.
No one provided significant real property appraisal assistance to the persons signing this
certification.
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The reported analyses, opinions and conclusions were developed, and this report has been
prepared, in conformity with the Code of Professional Ethics and Standards of Professional
Appraisal Practice of the Appraisal Institute.
The use of this report is subject to the requirements of the Appraisal Institute relating to
review by its duly authorized representatives.
As of the date of this report Elliott M. Clark, MAI completed the co ntinuing education
requirements of the Appraisal Institute.
As of the date of the report, Sandra S. Kennedy, has completed the Standards and Ethics
Education Requirement of the Appraisal Institute for Associate Members.
___________________________________
Dated Signed: March 17, 2014 Date Signed: March 17, 2014
Elliott M. Clark, MAI Sandra S. Kennedy
MT REA-RAG-LIC-683 MT REA-RAG-LIC-758
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GENERAL ASSUMPTIONS & LIMITING CONDITIONS
The appraisal is subject to the following conditions and to such other specific and limiting
conditions as are set forth in the appraisal report.
1. The legal description and site size are from the most recently recorded deed(s) or plat(s) and
are assumed to be correct.
2. The appraisers assume no responsibility for matters legal in character, nor do they render any
opinion as to title, which is assumed to be marketable. All existing liens, encumbrances and
assessments have been disregarded and the property is appraised as though free and clear under
responsible ownership and competent management.
3. Any sketches included in this report indicate approximate dimensions and are included to assist
the reader in visualizing the property.
4. The appraisers have not made a survey, engineering study or soil analysis of the property and
assume no responsibility in connection with such matters or for engineering, which might be
required to discover such factors.
5. Unless otherwise noted herein, it is assumed that there are no encroachments, zoning violations
or restrictions existing in or on the subject property.
6. Information, estimates and opinions contained in this report are obtained from sources
considered reliable and believed to be true and correct; however, no liability for them can be
assumed by the appraisers.
7. The appraisers are not required to give testimony or attendance in court by reason of this
appraisal, with reference to the properties in question, unless arrangements have been made
previously therefore.
8. The division of the land and improvements (if applicable) as valued herein is applicable only
under the program of utilization shown. These separate valuations are invalidated by any other
application.
9. On all appraisals, subject to satisfactory completion, repairs or alterations, the appraisal report
and value conclusion are contingent upon completion of the improvements in a workmanlike
manner.
10. Disclosure of the contents of this appraisal report is governed by the By-Laws and Regulations
of the Appraisal Institute. Except as hereinafter provided, the party for whom this appraisal
report was prepared may distribute copies of this report, in its entirety, to such third parties as
may be selected by the party for whom this appraisal report was prepared; howev er, selected
portions of this appraisal report shall not be given to third parties without prior written consent
of the signatory of this appraisal report. Further, neither all nor any part of this appraisal report
Clark Real Estate Appraisal (14-006es) (01/30/2014) 9
shall be disseminated to the general public by the use of advertising media, public relations
media, sales media or other media for public communication without the prior written consent
of the signatory of this appraisal report.
11. The Americans with Disabilities Act (ADA) became effective Januar y 26, 1992. The appraiser
has not made a specific compliance survey and analysis of the subject property to determine
whether or not it is in conformity with the various detailed requirements of the ADA. It is
possible that a compliance survey of the prop erty together with a detailed analysis of the
requirements of the ADA could reveal that the property is not in compliance with one or more
of the requirements of the act. If so, this fact could have a negative effect upon the value of
the property. Since the appraisers have no direct evidence relating to this issue, we did not
consider possible noncompliance with the requirements of ADA in estimating the value of the
property.
12. The appraisers are not experts at the identification of environmental hazards. This assignment
does not cover the presence or absence of such substances. Any visually detected or obviously
known environmental problems affecting the property will be reported and their impact on the
value will be discussed.
13. This appraisal assignment was not made nor was the appraisal rendered on the basis of a
requested minimum valuation, specific valuation, or an amount, which would result in approval
of a loan.
14. The appraisers are not building inspectors and this report is not a building inspectio n. Any
obvious defects are noted; however, this report is not to be relied upon for detection of unseen
defects.
15. This appraisal was prepared for the client and the intended user named in this report. The
analysis and conclusions included in the report are based upon a specific Scope of Work
determined by the client and the appraisers and are not valid for any other purpose or for any
other user.
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SCOPE OF THE APPRAISAL
The appraisers were asked to determine the value of the encumbered fee simple interest in the
subject property. Information about the subject property has been collected and analyzed in this
report and a narrative appraisal report for the subject property has been prepared.
The scope of the appraisal requires compliance with the Unifor m Standards of Professional
Appraisal Practice promulgated by the Appraisal Standards Board of the Appraisal Foundation
and the Guide Notes to the Standards of Professional Appraisal Practice adopted by the Appraisal
Institute. The standards contain binding requirements and specific guidelines that deal with the
procedures to be followed in developing an appraisal, analysis, or opinion. The Uniform Standards
set the requirements to communicate the appraiser’s analyses, opinions and conclusions in a
manner that will be meaningful and not misleading in the marketplace.
Scope of Property Viewing
Sandra Kennedy and Elliott M. Clark, MAI viewed the subject property. They were accompanied
by Christopher Clark of Clark Real Estate Appraisal and Sid Bush of the Cit y of Bozeman. The
interior and exterior of the building were viewed. The interior configurations are approximate
representations based upon a portion of the building plans provided by Comma -Q Architecture,
Inc. via the City of Bozeman.
Scope of Research
The history of ownership, historical uses, and current use were researched via the City of Bozeman
and the records of Gallatin County, Montana.
Area trends in development were researched. Comparable market data was obtained through a
combination of research by our firm; personal inspections by our firm; state-wide databases; public
record; and area realtors, appraisers, developers, and property owners. Every effort was made to verify
details of transactions with a party involved in the transaction or a knowledgeable third party.
Montana is a non-disclosure state and realty transfer sales price information is not available
via public record.
We researched the subject property history and discovered over 300 related documents just within the
City of Bozeman website. It is beyond the scope of this appraisal to review each document. The
addendum to this appraisal includes a summary of all documents and sources relied upon for this
report.
The subject property is not encumbered with a long term lease. It is an income producing property
and we requested and received operating income and expense information for the subject property.
We have considered this information in the highest and best use section of this report.
Because the subject is a historic property, additional research steps were required. Based on the article
“The Costs and Benefits of Historic Properties” written by Judith Reynolds, MAI, and included in
The Appraisal Journal, Spring 2006, there are nine questions to consider in the appraisal of historic
properties. These and the applicability of the considerations are included on the table on the following
page.
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Historic Properties Considerations
Consideration Applicability
What is the significance of this property to the history
of the United States and/or its region, community or
neighborhood and is its significance architectural,
cultural or related to a historical figure or event?
The Story Mansion is historically significant to the
City of Bozeman and the State of Montana as it
represents one of the finest surviving examples of turn-
of-the century regional architecture. Further, it was
built by Nelson Story, a notable pioneer best known as
the first man to drive cattle from Texas to Montana.
What designations does the property have or is it
eligible for in recognition of its significance?
The Story Mansion is listed on the National Register of
Historic Places.
Is the property solitary, or is it one of a grouping of
historic properties?
The Story Mansion is located within the Bon Ton
Historic District and is the most prominent example of
a group of homes built during the late 1800s and early
1900s.
Is the property eligible for historic rehabilitation tax
credits or other tax credits?
If owned by a private entity, the Story Mansion may
qualify for rehabilitation tax credits. Tax credits are
addressed in detail in the Market Analysis section of
this report.
Is the property eligible for grants, low-interest loans, or
other benefits?
Potential sources of funding are included in the Subject
Market Analysis section of this report.
Will the rehabilitated property benefit from heritage
tourism?
Some potential uses of the Story Mansion would likely
benefit from heritage tourism. These uses were not
determined to be the Highest and Best Use of the
subject property.
Is the property encumbered by, or eligible for, a
preservation easement?
The Story Mansion is encumbered by a 50-year
conservation easement between the City of Bozeman
and the Montana State Historic Preservation Office.
The conservation easement was granted as a condition of
the eligibility of the City of Bozeman (Grantor) for
financial assistance from the Montana State Historic
Preservation Office (Grantee). The easement is
discussed in detail in Property Description section of this
report.
For what adaptive uses is the property suitable? As currently allowed by a Conditional Use Per mit, the
Story Mansion may be used as a Community Center.
However, if renovated and permitted, the property is
suitable for a number of uses, from a single-family
residence to lodging to a professional building to a
public facility. The CUP is discussed in detail in the
Property Description section of this report.
What extraordinary costs of rehabilitation or operation
should be considered?
While some restoration has been completed, there is
extensive physical depreciation (functional
obsolescence and deferred maintenance) that will
require remediation prior to most uses. Completed
restoration and costs are discussed in the History of the
Subject section of this report. Rehabilitation estimates
are discussed in the Highest and Best Use and Cost
Approach sections of this report.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 12
Extraordinary Assumption
The value in this appraisal is based upon the extraordinary assumption that the costs for renovation
of the primary residence would not exceed that estimated by the appraisers. Significant variation in
the renovation costs may impact the subject property value.
Hypothetical Conditions
None
Highest & Best Use
Our opinion of the highest and best use for the subject property was developed using the research
collected relative to the subject property, area development trends, and demographics. The
information collected is considered comprehensive and provided a credible basis for carefully
considered analyses. We have based the highest and best use analysis on the zoning, conditional use
restrictions and encumbrances by easement that are currently in place. It was beyond the scope of this
appraisal report to prepare a feasibility analysis for every type of proposal that has been submitted to
the City. Additionally, it was not possible to prepare a credible feasibility analysis for each proposal
submitted to the city because the proposals do not include sufficient details regarding costs for each
proposed use. The appraisal process presented was based upon the highest and best use conclusion
for the subject property.
Appraisal Process
The subject property consists of 2 parcels, both of which are owned by the City of Bozeman. The
parcels are being utilized as assembled. For these reasons, we have provided the value of the subject
property as assembled. There are three recognized approaches in the valuation of real property. They
are: the Cost, Sales Comparison and Income Approaches. The Sales Comparison Approach provides
the most credible indication of value for vacant land when there are comparable sales available. Based
upon our analysis there were sufficient comparables and sufficient additional market data available
to prepare a credible Sales Comparison Analysis for the subject site as if vacant. All three approaches
were considered for the valuation of the subject property as improved. The income producing
potential for the subject property is addressed in the Highest and Best Use section of this report. Based
upon our analysis the Income Approach is not applicable to the valuation of the subject property. The
Cost Approach and Sales Comparison Approach were developed to value the encumbered fee simple
interest in the subject property as improved. The value indications from these two approaches were
reconciled for a final value conclusion of the encumbered fee simple interest in the subject property.
Environmental
The appraisers do not possess the requisite expertise and experience with respect to the detection
and measurement of hazardous substances, unstable soils, or freshwater wetlands. Therefore, this
assignment does not cover the presence or absence of such su bstances as discussed in the Limiting
Conditions section of this report. However, any visual or obviously known problems affecting the
property will be reported and their impact on the value will be discussed.
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General Data Sources
Individuals and offices consulted in order to complete this appraisal include the following:
Various Departments of the City of Bozeman and Gallatin County
Various Departments of Other Montana Counties
Montana Department of Revenue
Various Montana Area Multiple Listing Services including, Northwest,
Southwest, Butte, Billings, Missoula, Great Falls and Helena
Various Area Real Estate Agents, Real Estate Appraisers, Property
Managers, Property Owners, Tenants and Builders
Various Managers of Historic Properties throughout Montana
Specific data sources are noted in the body of the report where appropriate.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 14
IDENTIFICATION OF THE SUBJECT PROPERTY
The address of the subject property is 811 South Willson Avenue, Bozeman, Montana. The
property is located within of the city l imits of Bozeman. The assessor numbers for the subject are
included in the Summary of Salient Data and Conclusions portion of this report. A copy of the
most recent deed is included in the Addendum portion of this report. The legal descriptions
included in the most recently recorded deed for the subject property have changed since the most
recent transfer. A copy of the most recent subject property plat is included in the Property
Description section of this report.
DATE OF INSPECTION
January 30, 2014
EFFECTIVE DATE OF MARKET VALUE
January 30, 2014
PROPERTY RIGHTS APPRAISED
Fee simple is the greatest right and title, which an individual can hold in real property. The fee simple
interest is defined in the Appraisal of Real Estate, 13th Edition, on page 114 as follows:
“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, escheat.”
The subject property is encumbered by a conservation easement. The encumbered fee simple
interest for the subject property is provided in this report.
The leased fee interest is an ownership interest held by a landlord with the rights of use and occupancy
conveyed by lease to others. There are no leases in place for the subject buildings. For that reason no
leased fee estate currently exists for the subject property.
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PURPOSE OF THE APPRAISAL
The purpose of this appraisal is to estimate the market value of the encumbered fee simple interest in
the subject property, as of January 30, 2014.
INTENDED USE OF THE APPRAISAL
It is understood that the intended use of this appraisal is for potential marketing and sale of the subject
property.
CLIENT & INTENDED USER(S) OF THE APPRAISAL
This report was prepared for the City of Bozeman, the client. No additional third parties can rely upon
this report without the express written consent from both the appraisers and the client.
DEFINITION OF MARKET VALUE
Market value is defined in the following manner:
"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, knowledgeably and assuming the price is not affected by undue stimulus."1
Implicit in this definition is the 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 he considers his own
best interest;
(3) a reasonable time is allowed for exposure in the open market;
(4) payment is made in terms of cash in US 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.
1 Office of the Comptroller of the Currency - Comptroller's Manual for National Banks, March 1990, 12CFR, parts 34.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 16
HISTORY OF SUBJECT PROPERTY & STATEMENT OF OWNERSHIP
Ownership History
The subject property is owned by The City of Bozeman. The most recent transfer of the subject
property was from Montana Alpha Building Association of Sigma Alpha Epsilon, Inc. via
Warranty Deed recorded on April 18, 2003 with the Gallatin County Clerk and Recorder’s Office
as Document #2104950. A table with a history of recorded changes affecting the subject property
since it was purchased by the City of Bozeman is presented below.
Based on our research of the City of Bozeman documents, the city paid $1,316,489 for subject
property in 2003.
Use History
The subject property was built in 1910 by Nelson Story for the T.B. Story family’s use as a family
residence. The subject property was sold to Sigma Alpha Epsilon fraternity in 1922. The fraternity
sold the subject property to the City of Bozeman in 2003.
After purchasing the subject property the City began renovations in 2004. Ren ovations to portions
of the subject improvements were completed in 2009. The grounds and improvements were made
Assessor #
Recording
Date Document Type Document #Seller/Grantor Buyer/Grantee Legal Total Acres
Various
(26 Lots-Block 3)
4/18/2003 Warranty Deed 2104950 Montana Alpha
Building Association
of Sigma Alpha
Epsilon, Inc.
The City of Bozeman Lots 1-26 of Block 3 of
Butte Addition to the
City of Bozeman,
Gallatin County,
Montana
2.147 acres (26 city
lots as assembled)
000RGH4399 9/19/2005 Amended Plat of original
26 lots in Block 3
2202418 City of Bozeman N/A Lot 1A of Amended
Lots 1-26, Block 3 of
Butte Addition to the
City of Bozeman,
Gallatin County,
Montana
2.147 acres as
assembled (26 lots
were re-platted to be
one lot)
000RGH4399 7/21/2009 Conditions of Approval for
a Conditional Use Permit
for use of 1st floor of
Story Mansion as a
Community Center-
(Application Z-09022 in
City of Bozeman Dept of
Planning & Community
Development)
2337320 City of Bozeman N/A Lot 1A of Amended
Lots 1-26, Block 3 of
Butte Addition to the
City of Bozeman,
Gallatin County,
Montana
2.147 acres
000RGH4399 7/31/2009 T.B. Story Mansion &
Carriage House
Conservation Easement
Agreement for Save
America's Treasures
Grant No 30-04-ML-0046
2338483 City of Bozeman Montana State Historic
Preservation Office
Lot 1A, Block 3 of
Amended Butte
Addition to the City of
Bozeman, Gallatin
County, Montana
2.147 acres
000RGH4399 &
00RGH62664
12/29/2009 Amended Plat of Lot 1A to
create Lots 1A-1 & 1A-2
2350319 City of Bozeman N/A Lots 1A-1 & 1A-2 of
Amended Lot 1A, Block
3 of Butte Addition to
the City of Bozeman,
Gallatin County,
Montana
1.0381
+ 1.1092
= 2.147
acres as assembled
(One lot re-platted to
now be 2 lots)
000RGH62664 12/21/2009 Commission Resolution
No. 4227 - Lot 1A-2 is
declared to be Public Park
Land
2349815 City of Bozeman N/A Lot 1A-2, Block 3 of
Butte Addition to the
City of Bozeman,
Gallatin County,
Montana
1.1092 acres (The
portion of subject
that was declared
public park)
History of Property since Last Transfer
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available for rent by the public beginning in August 2009. Also in 2009, the city designated Lot
1A-2 as public parkland and encumbered the 1 st floor and basement of the subject residence with
a Conservation Easement for use as a community center. The Conservation Easement will be
discussed in more detail in the Property Description section of this report. (Source: The T.B. Story
Mansion Architectural Assessment, 2003, Comma-Q Architecture, Pages 113-114; Document link
provided to the appraisers by the client).
Based on our research, there have been a number of sources of funding for the renovation of the
subject property. Details of sources of income and the expenditures made since purchase are
provided in the table below.
Based on our research, the total investment in the subject property as of January 2010 was
approximately $3,600,000. We located several newspaper articles from 2012 th at referenced total
expenditures of $3,700,000. We have appraised the subject for less than the 2003 sale price plus
renovation costs to date. Restoration costs involved with historic properties do not always equate
Date Description Details Source of Funding Designation Use
Amount
Funded by
Other Sources
Amount Spent
by City Total
2003 City Purchases from SAE Fraternity City of Bozeman General Fund $1,316,489
Windows $297,000
Exterior Stabilization $497,000
2004 City of Bozeman obtains Save
America's Treasures (SAT)
matching grant for Story Mansion
(Conservation Easement required)
National Park Service Basement and First Floor
Renovation for use as Community
Center
$493,840
2008 City of Bozeman matching funds to
meet requirments for receiving the
Save America's Treasures Grant
City of Bozeman General Fund Basement and First Floor
Renovation for use as Community
Center
$450,000
2009 City General Fund to be
reimbursed by Public Fundraising
City of Bozeman General Fund Basement and First Floor
Renovation for use as Community
Center
$391,222
2009 National Trust for Historic
Preservation Grant
Federal Funds $7,000
2009 HB645 Historic Preservation Grant State Funds Insulation $24,334
2009 Main Floor and Basement
Completed
2010 New Roof,some new siding,
windows, gutter repairs, and re-
painting required due to Hail
Damage
Hazard Insurance Hazard Insurance
2004-2010 Donations to City for Story
Mansion
City/Donations $5,935
Unknown
Dates
Other Grants State and County Funds $5,000
Unknown
Dates
Other Additional Expenditures City of Bozeman City of Bozeman $113,016
$1,330,109 $2,270,727 $3,600,836Total
Investments in the Subject Property through January 2010
Source: City of Bozeman Commission Memorandum Data February 7, 2011
Max Baucus and Conrad Burns
successfully obtain HUD grant for
exterior paint, windows &
structural stabilization of the Story
Mansion and carriage house
2004 U.S. Department of Housing &
Urban Development
Clark Real Estate Appraisal (14-006es) (01/30/2014) 18
to a commensurate increase in market value. This is addressed in the Subject Market Analysis
portion of this report.
Marketing History
According to City Ordinances, there are restrictions and requirements related to the transfer of City
properties. These requirements are discussed in the Pr operty Description, which addresses
“Easements, Buffers, Restrictions and Encroachments”.
Based on our research, the subject has not been marketed on the area MLS since it was purchased.
The City of Bozeman published a request for proposals in the spri ng of 2011 and again in the
spring of 2013. In both cases, the RFP was advertised in the Bozeman Daily Chronicle multiple
times and was uploaded to the Bids/Projects page of the city of Bozeman website. A table with a
history of the RFPs and the submitted proposals is on the following page.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 19
We have not appraised the subject based on the hypothetical use of any of the proposed projects.
It is beyond the Scope of this report to have done so since we were not provided with details of
renovation or projected income and expenses for each project.
DateOrganization/Submitting EntityDocument Description
Amount of
Proposal or
Buy/Sell
Related Fiscal
Conditions
Explanation of Proposed
Price
Mar-11 City of Bozeman RFP A Request for Proposals is approved by City
Commission
Jul-11 Exergy
Development
Group, LLC
Buy/Sell Lot 1A-1 and improvements as encumbered
with Conservation Easement for continued
use as Community Center with reversion to
city if buyer fails to restore the property.
Closing was set for June 30, 2012 or sooner.
The Buyer offered $1,000 in earnest money
but eventually defaulted on the agreement.
$391,222 The suggested price of
$391,222 represented the
amount of general fund
money that the city spent
in 2009 on renovating the
mansion's first floor that
was not covered by federal
grant or city matching
funds.
Apr-13 City of Bozeman City Commission voted unanimously to find
Exergy Friends of the Story in default of its
agreement to purchase the Story Mansion.
N/A
May-13 City of Bozeman RFP A Request for Proposals is approved by
Commissioners and advertised in Bozeman
Daily Chronicle legal section multiple times
and uploaded to City of Bozeman website
N/A N/A
Proposal 1A City gifts the Story Mansion for use as a Fine
Arts Museum and Carriage House as an office
for Museum
Gift by City None offered
Proposal 1B If not gifted, Offer to Purchase based on Grant
Funding
$400,000 Grant Money waiting
to be released for
acquisition.
Renovation money to
be raised.
None offered
Aug-13 The Montana
Center for Civics
Engagement
Proposal 2 Use not specified $400,000 Renovation money to
be raised. Deposit of
the title with the
Montana History
Foundation to be held
in trust. City would
provide grounds
maintenance.
None offered
Aug-13 Story Mansion Inn
Group
Proposal 3 17 overnight guest rooms in Mansion, wine
bar and limited dining for guests and general
public; 6 overnight guest rooms and meeting
room in Carriage House
$500,000 and
possibly up to
$900,000
Initial Payment of
$500,000 upon
closing and any
renovation costs
above $1,100,000
would be deducted
from the remaining
$400,000
City recovers a portion of
the initial investment,
achieves public relations
success and diminishes
future risk. City keeps the
open space on the city
block.
Aug-13 Tree of Life
Ministries
Proposal 4 The Portal School of Creativity and Innovation Fair Market Value
(anticipated by
bidder to be
$2,600,000)
None Intent is to recognize the
original investment to
purchase ($1,316,489) and
the restoration
investments ($1,300,000
estimated by Tree of Life).
Source: City Commission Report from November 12, 2013
Bozeman Art
Museum
Aug-13
by City of Bozeman
History of Marketing and Request for Proposals
Clark Real Estate Appraisal (14-006es) (01/30/2014) 20
PROPERTY DESCRIPTION
A. GENERAL SITE DESCRIPTION
The subject is comprised of two lots that total 2.147 acres as assembled and together cover one city
block. Lot 1A-1 totals 1.0381 Acres and is improved with a historic 3 story single-family residential
home and a carriage house/barn. Lot 1A-2 is 1.1092 acres in size, is unimproved and has been
dedicated as parkland. The subject property is located within the city limits of Bozeman in an area
known as the Bon Ton Historic District.
The subject is bounded by College Street to the north, Willson Avenue to the east, Harrison Avenue
to the south and Grand Avenue to the west. The subject property is identified as follows:
Exhibits relative to the subject property and improvements follow.
Subject Property Plat Map
Lot Legal
Assestment
Code Status
Size in
Acres
1
Lot 1A-1 of Amended Lot 1A of Block 3 of
Butte Addition, City of Bozeman, County of
Gallatin, Montana 00RGH4399 Improved 1.0381
2
Lot 1A-2 of Amended Lot 1A of Block 3 of
Butte Addition, City of Bozeman, County of
Gallatin, Montana 00RGH62664 Dedicated Park 1.1092
2.1473
811 S Willson Avenue
Section 18, Township 02 South, Range 06 East
Bozeman, Montana
Total Land
Clark Real Estate Appraisal (14-006es) (01/30/2014) 21
Subject Property Zoomed In View of
Amended Lots 1A-1 and 1A-2 of Block 3 of Butte Addition to the City of Bozeman
Clark Real Estate Appraisal (14-006es) (01/30/2014) 22
Subject Property
Portion of Montana Cadastral Map
(Boundary lines are approximate)
Aerial View Zoomed Out
Subject Lot 1A-2
Subject Lot 1A-1
Subject
Clark Real Estate Appraisal (14-006es) (01/30/2014) 23
Subject Property Site Plan from 2008 Renovation Project
B. ACCESS & PARKING
There are two 20 foot wide paved driveways providing vehicular access to the subject property from
Grand Avenue. The driveways access an asphalt paved parking lot which includes 11 parking spaces,
one of which is handicapped accessible. Parking appears adequate for the subject improvements.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 24
C. ZONING
The subject property is located within the R-1, Residential Single-Household Low Density District.
The district is described in the table below:
In addition to the primary allowable uses, a Conditional Use Permit (CUP) is approved for the
subject property. This CUP allows the subject to be utilized as a community center. A community
center, as defined in Section 18.80.620 of the Bozeman Municipal Code (BMC), is “a building or
portion of a building used for nonprofit cultural, educational, recreational, religious or social
activities which is open to the public or a designated part of the public, usually owned and operated
by a public or nonprofit group or agency”. The CUP also allowed an a dditional access to the
subject from Grand Avenue and the improvement of the existing parking area.
Intent of the District “to provide for primarily single-household residential development and related uses within the city at
urban densities,and to provide for such community facilities and services as will serve the area’s
residents while respecting the residential character and quality of the area."
Primary Allowable Uses Single-household dwellings, Community residential facilities with eight or fewer residents, Essential
Services - Type 1(such as water and sanitary sewer distribution and collection lines), Family day care
home, Group day care home, Group living, Public and private parks, Manufactured homes on permanent
foundations, and Townhomes when utilized to satisfy the requirements of Affordable Housing.
Conditional Uses Accessory dwelling units,bed and breakfast,community center,Cooperative housing,day care center,
extended stay lodging, golf course, and uses approved as part of a PUD per article 20 of this chapter.
Minimum Floor Area That area required by the city’s adopted International Building Codes.
Minimum Lot Coverage Area no more than 40% of the lot area for single-household dwellings,
no more than 50% of the lot area for townhomes and
no more than 60% for any principal and accessory buildings used to satisfy the Affordable Housing
criteria.
Minimum Lot Area 5,000 square feet for single-household dwellings; however, if satisfying Affordable Housing the
requirement is 2,700 square feet for single-household and 2,500 square feet for townhomes. It is
recognized these are minimums and that lots may need to be larger than the minimum to comply with
other standards in the regulations.
Minimum Lot Width Ranges from 30 to 50 feet with a wider allowances for single-household and smaller widths allowable
for Affordable Housing single-household dwellings and townhomes.
Minimum Yard Requirement Front yard:ranges from 15 to 25 feet and is based on the adjacent street type (arterial,collector or
local).
Rear yards: required to be at least 20 feet, but may be 25 feet when adjacent to an arterial street.
Side yards: required to be 5 feet or 0 for interior townhomes.
All vehicle entrances,oriented to the street,into garages shall be no closer than 20 feet to a property
line.
Maximum Building Heights Based on roof pitch and ranges from 24 to 36 feet.
Garages Required to be subordinate to the dwelling and shall not obscure the entrance to the dwelling.
Minimum Density Five dwellings per net acre.
Off Street Parking Requirement The number of spaces required is dependent upon the unit type and number of bedrooms (from 1 to 4) or
is based on the number of residents in the case of a group residence or the conditional use if approved
for a CUP
R1-Residential Single-Household Low Denisty District
Clark Real Estate Appraisal (14-006es) (01/30/2014) 25
The subject is restricted by the location within the Neighborhood Conservation Overlay District.
The intent and purpose of the Neighborhood Conservation Overlay District is to:
“stimulate the restoration and rehabilitation of structures and all other elements
contributing to the character and fabric of established residential neighborhoods and
commercial or industrial areas.”
The subject property is additionally located within the Bon Ton Historic District. The Bon Ton
Historic District is one of ten historic districts within the Neighborhood Conservation Overlay
District. All ten of the historic districts are listed on the National Register of Historic Places.
(Only nine of the districts are depicted on the Neighborhood Conservation Overlay map because
the Montana State University District was recently added.) The Bon Ton District is roughly
bounded by Olive Street, Willson Avenue, Cleveland Street an d 4th Avenue. It was added to the
National Register of Historic Places on October 23, 1987.
Any property located within the Neighborhood Conservation Overlay district requires a Certificate
of Appropriateness by the City of Bozeman design review board for all new construction, alteration
to existing structures, movement of structures into or out of the neighborhood , or demolition of
structures unless specifically exempted. Properties that are exempt from this requirement include
those which are listed on the National Register of Historic Places. Since the subject is located
within the Bon Ton Historic District, it is considered to be listed on the National Register of
Historic Places and any changes to the subject property are allowable only by approval of
the National Park Service.
Any changes to structures listed on the National Register of Historic Places are based on The
Secretary of the Interior’s Standards for the Treatment of Historic Properties. The Standards are
included in the addendum of this report and the Standards and the Guidelines can be found at the
National Park Service website: (Guidelines for Preserving, Rehabilitating, Restoring, and
Reconstructing Historic Buildings)
http://www.nps.gov/tps/standards/rehabilitation/sustainability-guidelines.pdf
Additionally, the subject is encumbered by a Conservation Easement that is discussed more
thoroughly in the Easement Section of this portion of the report. This Conservation Easement is the
result of a condition of the grant by the National Park Service. The Conservation Easement requires
compliance with the preservation guidelines of The Secretary of the Interior’s Standards for the
Treatment of Historic Properties. These guidelines pre-empt the City of Bozeman’s Certificate of
Appropriateness standards and Design Guidelines for Historic Preservation.
A portion of the zoning map with the subject indicated is presented on the following page.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 26
City of Bozeman Zoning Map with Subject Property Outlined in Red
Neighborhood Conservation Overlay Map with Historic Preservation Districts
Subject
Subject
Clark Real Estate Appraisal (14-006es) (01/30/2014) 27
City of Bozeman Parks Map – Subject Property Outlined in Red and
Park located in Lot 1A-2 is indicated in darker green
City of Bozeman Lighting District Map
Subject Property located in Willson Ave District 295
Subject
Subject
Clark Real Estate Appraisal (14-006es) (01/30/2014) 28
D. ASSESSMENT/PROPERTY TAXES
The subject is owned by the City of Bozeman. The City of Bozeman is exempt from paying real
property taxes. If the subject were sold to a private owner/entity, the subject would be taxed based
on its assessed value.
E. IMPROVEMENTS
The subject improvements include a 3-story single family residence with a 2-story carriage
house/barn which were constructed from 1908 through 1910 and were partially renovated from
2004 through 2009. The main house roof and carriage house roof were completely replaced in
2010 as a result of hail storm damage. The subject main house totals approximately 9,594 square
feet above grade with a 3,375 square foot basement. The carriage house totals approximately 4,680
square feet on two floors.
The table below provides a detail of the square footage for each floor of each improvement. The
square foot estimates were provided to the appraisers by Comma-Q Architecture, Inc., architects
for the client. The estimates were based on plans created by the architects in the assessment of the
property in 2003 and the renovation of the property in 2008. We have relied upon these square
footage estimates in this report.
Details of the improvements and renovations to the impr ovements are presented in the following
pages of this report.
Square
Footage
Story Residence
1st Floor - Community Center 3,304
2nd Floor - Vacant/Requires Deferred Maintenance 3,450
3rd Floor - Vacant/Requires Deferred Maintenance 2,840
Above Grade SF 9,594
Basement - Community Center*1,166
Basement - Unfinished/Mechanical*2,209
Total SF of Story Mansion 12,969
Carriage House
1st Floor - Finished*1,487
1st Floor - Storage*873
2nd Floor - Unfinished Storage 2,320
Total SF of Carriage House 4,680
at 811 Willson Avenue, Bozeman, MT
Improvements
Source: Comma Q Architects; *Estimated breakdown by Appraisers
Clark Real Estate Appraisal (14-006es) (01/30/2014) 29
Story Mansion - Main House
Exterior
The subject main house is of wood frame construction. The roof is a multi-gabled style with cedar
shake shingles. It includes a turret on the front (east) side with two dormers and additional dormers
on the south and west sides. According to Exhibit A of the Conservation Easement between the
City of Bozeman and the Montana State Historic Preservation Office, “the mansion exterior
features a broad range of stylistic influences in addition to Queen Anne architecture, including
Tudor Revival and to a lesser extent Craftsman details.” (Conservation Easement Agreement,
Gallatin County Clerk & Recorder, Document 2338483)
Exterior walls are brick on the main floor, cedar shingles on the 2 nd floor and stucco with half-
timber accents on the 3rd floor. The east side provides a large main floor entry. Additional entries
include:
a Porte Cochére entry on the north side ;
a rear entry to a hallway and prep kitchen on the northwest side;
a rear entry access stairwell to the basement on the southwest side ;
a solarium entry on the south side; and
a handicapped ramp along the south side of the subject accessing a wrap -around porch to
the front and the solarium entry points.
There is a second-floor balcony on the east side off of the master bedroom and a second-floor
balcony on the west side off of a secondary bedroom. The main house includes copper gutters and
downspouts. There are a number of window styles in the main house, including multi-pane transom
windows, double-hung semi-circular windows, and diamond paned fixed windows.
Portions of the subject have been renovated since 2003. Renovations to the exterior include:
new copper gutters, downspouts and dry wells;
removal of lead paint and application of new non-toxic paint;
masonry work on foundation;
improvements to woodwork on porches;
the addition of a wheelchair access ramp;
new wood window casings were constructed and wherever possible window glass was
reclaimed. (The majority of the glass window panes in the main house are original but
some replacement glass was required after the hail storm of 2010.);
a new roof was added in 2010 after the hail storm.
Interior Main Floor & Basement
The subject basement foundation and crawl space below the porch are constructed of 18 - to 20-
inch-thick stone masonry walls. The basement fl oor is 6- to 8-inch-thick slab on grade. (Source:
Comma-Q Architectural Assessment, Page 49)
The main floor includes a front entry foyer, a side entry, a dining room, living room, prep-kitchen,
library, office, rear entry hallway and solarium.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 30
The basement includes a men’s restroom, a women’s restroom, a coat room, a storage closet, a
mechanical room, a rear exit and additional non -renovated storage areas.
The entire main floor and portions of the basement were renovated for use as a community center
between 2004 and 2009. Renovations to basement and main include:
an addition to the basement and main floor on the west side of the house provided a
basement stairwell entry and a main floor storage area and bathroom ;
addition of public men’s and women’s restroom s in the basement;
energy efficient HVAC system and an air circulation system ;
new electrical;
new plumbing;
updated wood flooring, some of which was reclaimed wood and some new period flooring
to match original flooring;
refinished wood wainscoting on the first floor walls;
renovated prep kitchen with metal derryboard walls and vinyl flooring;
new period type wallpaper in living room, dining room, office and library;
doors and trim are either reproduction period doors or reclaimed doors throughout the
basement and 1st floor;
glycol fire suppression sprinkler system installed on the main floor and in the basement ;
restoration of original lighting fixtures and new fixtures where required;
hot water radiant heat ceiling panels were added in the solarium;
insulation of exterior walls;
fireplaces in the living room and office have been closed off. It is possible that the
fireplaces could be utilized again, but they are not currently functional ;
reinforced structural components.
Interior 2nd & 3rd Floors
The 2nd and 3rd floors of the subject residence are not currently used for the Community Center
and these levels are in disrepair. Bathrooms on the 2nd floor are no longer in use and water lines
to them have been capped. At the top of the 2nd floor stairwell landing there is a temporary wall
and entry door leading into the 2nd floor foyer. The 2nd floor is partitioned into 9 rooms based upon
prior use as a residence and fraternity house. The rooms on the 2nd floor include: a foyer, a master
bedroom with study, a master bathroom, 6 smaller bedrooms , two additional bathrooms and a
stairwell to the 3rd floor. The master bedroom includes a fireplace and a d ressing room.
The 3rd floor is partitioned into 6 rooms based upon the prior use as a residence and fraternity
house. The rooms on the 3rd floor include: a main room (originally designed as a ballroom) and 5
smaller rooms.
Although the 2nd and 3rd floor are not renovated for use, some updates were made to these floors
for efficiency of maintenance.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 31
Updates to the 2 nd and 3rd floors include:
a glycol fire suppression system;
reinforced structural components on 2 nd floor;
insulated exterior walls;
ceiling-mounted gas space heaters added in various locations;
doors removed to provide adequate air circulation.
Quality and Condition
The overall quality of construction of the main residence is considered to be excellent. The overall
condition of the renovated 1st floor and renovated areas of the basement is considered to be
excellent. The overall condition of the areas of the basement that are not renovated and the 2 nd
and 3rd floors is considered to be poor.
Carriage House/Barn
Exterior
Construction of the carriage house/barn was completed in 1910. The carriage house is 2-story,
wood frame construction with a gambrel style, cedar shake roof including two dormers on the
north side and two on the south side. The main floor is approximatel y 2,360 square feet and the
2nd floor is 2,320 square feet in size.
Exterior walls are brick and cedar shingles on the main floor, and stucco with half-timber accents
on the 2nd floor. The building was originally designed as a carriage house with a hay loft. The
main floor was converted for use as a living area during the years the subject property was used as
a fraternity residence.
Portions of the carriage house have been updated since 2003. Renovations to the exterior include
of the Carriage House include:
new copper gutters, downspouts and dry wells;
removal of lead paint and application of non-toxic paint;
a new cedar shake roof, replaced after 2010 hail storm .
Interior Main Floor Carriage House:
We estimate approximately one-third of the main floor of the carriage house includes unfinished
storage area. The remaining main floor is finished area and includes: an open area; 4 smaller rooms
that were previously used for bedrooms when occupied by the fraternity; and a bathroom with two
stalls, two showers and two sinks. Interior finishes include carpet and vinyl flooring, gypsum board
walls and acoustic tile ceilings with fluorescent lighting.
The 2nd floor was originally a hay loft and has not been significantly modified. The 2nd floor has
exposed roof timber trusses. There are two stairwell accesses to the 2 nd floor hay loft. One access
is from the unfinished storage area and the second is from the northeast corner of the carriage
house.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 32
Quality and Condition
The overall quality of construction of the carriage house is considered good. The overall condition
of the carriage house is considered to be fair on the 1st floor and poor on the second floor.
Site Improvements
Site improvements include an asphalt paved circular driveway and parking lot with entry and exit
to Grand Avenue. The parking lot includes 11 parking spaces including 1 handicapped accessible
space. The subject is serviced by a city water and sewer and also includes 2 private wells for site
irrigation.
Improvement Exhibits
Architectural plans were prepared by Comma Q Architecture, Inc. in 2003 for an Architectural
Assessment of the subject property. Additional architectural plans were prepared by Comma Q.
Architecture in 2008 for a renovation project for the subject property. Both sets of plans were
relied upon for architectural details and square footages utilized in this report. Portions of both
architectural plans are included on the following pages as report exhibits. Photographs of the
subject improvements are included at the end of this section of the report.
F. EASEMENTS, BUFFERS, RESTRICTIONS, AND ENCROACHMENTS
Appraisers do not prepare thorough title searches in normal course of business. We were not
provided with a title report for the subject property.
The most significant easement for the subject property is a Conservation Easement between the City
of Bozeman and the Montana State Historic Preservation Office. The easement encumbers the portion
of the subject property identified as Lot 1A, Block 3 of Amended Butte Addition. The easement is
entitled T.B. Story Mansion and Carriage House Conservation Easement Agreement for Save
America’s Treasures Grant No. 30-04-ML-0046. The easement is dated May 26, 2009 and was
recorded on July 31, 2009 at the Gallatin Clerk and Recorder’s Office as Document #2338483.
According to the document, “the purpose of the easement is the preservation of the Story Mansion
and carriage house property, a one-block City of Bozeman site, which includes two buildings, that is
culturally, historically and architecturally significant.”
The conservation easement was granted as a condition of the eligibility of the City of Bozeman
(Grantor) for financial assistance from the National Park Service. The consideration for the easement
was a $493,839 grant to the City of Bozeman from the National Park Service of the United States
Department of the Interior.
Listed below are the conditions of the easement that, in our opinion, impact market value:
the conservation easement is for a period of 50 years;
no construction, alteration, or remodeling of the subject property will be allowed without the
approval of the Grantee and will be based on the Secretary of the Interior’s Standards for the
Treatment of Historic Properties preservation guidelines. A written narrative, with
architectural plans, indicating the original character-defining elements of the subject property
at the time the grant was created and is to be kept with the Grantee for reference purposes for
the duration of the easement;
Clark Real Estate Appraisal (14-006es) (01/30/2014) 33
the Grantor agrees to provide public access to view the grant-assisted work or features no less
than 12 days a year on an equitably spaced basis. The dates and times that the subject property
will be open to the public must be annually published and provided to the Grantee. A
nondiscriminatory admission fee, comparable to fees charged at similar facilities in the area,
is permitted;
the Grantor agrees that the Grantee, its employees, agents and designees shall have the right
to inspect the Subject Property at all reasonable times, with twenty-four hours written notice,
in order to ascertain whether the conditions of this easement agreement are being observed;
the Conservation Easement shall run with the land and be binding on the Grantor, its
successors and assigns. Reference to the easement must be inserted in any deed or other legal
instrument by which the Grantor divests itself of either the fee simple title or other lesser estate
in the Subject Property.
(Source: T.B. Story Mansion and Carriage House Conservation Easement Agreement for
Save America’s Treasures Grant No. 30—4-ML-0046)
A copy of the Conservation Easement is retained in the appraisal work file.
As noted, the subject property is currently owned by the City of Bozeman. Based on Chapter 2.05
of the Bozeman Municipal Code, there are additional restrictions in place related to the transfer
and sale of the subject property. The following ordinances are of particular significance:
Bozeman Municipal Code 2.05.030.D states that “if the City owns property containing a
historically significant building or monument, the City may sell or give the property to
nonprofit organizations or groups that agree to restore or preserve the property. The
contract for the transfer of the property must contain a provision that: 1) requires the
property to be preserved in its present or restored state upon any subsequent transfer; and
2) provides for the reversion of the property to the City for noncompliance with co nditions
attached to the transfer”;
Bozeman Municipal Code 2.05.040 indicates “when the City Commission, after public
hearing, has determined by a two-thirds vote of all the members that any real property
owned by the city is not needed for public use, or that the public interest may be furthered,
the City may sell such property by bid, auction with reserve, or negotiated sale or exchange,
subject, where appropriate, to a minimum price established through an appraisal that
certifies the value of such property. Notice of sale, exchange, or auction shall be published
as provided in MCA 7-1-4127. The city may terminate the sale procedures used at any
time and may reinitiate the same or different procedures at a later date.”;
Bozeman Municipal Code 2.05.050.A states that “Except as provided in Section 2.05.030
D, a sale under this part must be for cash or on terms that the City Commission may
approve, provided that at least 20% of the purchase price is paid in cash. All deferred
payments on the purchase price of any property sold must bear interest at a market rate,
payable annually, and may be extended over a period of not more than five years ”. And
2.05.050.B states that “Subject to Section 2.05.030.D, a sale may not be made for less than
90% of the appraised value”.
(Source: Commission Memorandum, February 7, 2011 and Bozeman Municipal Code.)
Clark Real Estate Appraisal (14-006es) (01/30/2014) 34
Based on the most recently recorded plat of the subject, there is a utility easement along the east
boundary of Lot 1A-2, beginning 83.94 feet south of the n ortheast corner of the lot. The utility
easement is trapezoidal in shape and is approximately 3,600 square feet in size.
It is assumed that any additional utility easements are located in the street rights -of-way. We did
not locate any additional easements, buffers, restrictions, or encroachments associated with the
subject property. If there are additional easements, buffers, restrictions, or encroachments in place
that the appraisers are not aware of the value indicated in this report could be affected.
G. TOPOGRAPHY, VEGETATION, & ENVIRONMENTAL CONSIDERATIONS
We have not been provided with an environmental audit for the subject property and assume there
are no toxic materials or groundwater contamination of the property. We assume that drainage has
been adequately engineered for the site and improvements. We have not been provided with a soil
study for the subject site. We assume the soil can accommodate the type of construction typically
seen in the subject area.
The subject topography is generally level. The subject property includes mature landscaping with
mature cottonwoods, firs and shrubs. The site also includes annual and perennial beds that were
covered with snow when viewed by the appraisers. Images available to the appraisers online indicate
the perennial and annual beds to be elaborate and well maintained.
According to the Federal Emergency Management Flood Zone Map the subject property is located
in an area of minimal flood risk. This is shown on floo d map 30031C0816D dated September 2,
2011. A copy of a portion of the City of Bozeman GIS map link to the FEMA map is included in
this section of this report.
H. UTILITIES
The subject property has access to electricity, natural gas, telephone, internet, city water and sewer
and includes two private wells for site irrigation.
I. PUBLIC SAFETY AND SERVICES
Police and Fire services are provided by the City of Bozeman.
J. HISTORIC SIGNIFICANCE
The subject property is historically significant. It was designed by the Helena architect, C.S. Haire
and represents Queen Anne architecture from the early 1900s. It is located on a full city block, which
is very rare, and may be one of only three remaining in the state.
The subject was built by Nelson Story, an entrepreneur and cattle rancher. He is known for his 1866
cattle drive of 1,000 Texas Longhorns from Texas to Montana along the Bozeman Trail – a first in
cattle drives. Nelson Story built the mansion along Willson for his son, T. Byron Story, and his son’s
family. Nelson Story was a successful businessman and became Bozeman’s first millionaire. His
son, T. Byron Story was also a local businessman, with interest in cattle, gold, sheep and wheat. The
subject is located within the Bon Ton Historic District. As part of this district, it was added to the
National Register of Historic Places in October 1987. It is also listed on the Montana State Register
of Historic Places.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 35
As a property that has historic significance, certain restrictions apply to the subject. These were
discussed in prior sections of the Property Description including Zoning and Easements, Buffers,
Restrictions and Encroachments.
K. SITE SUITABILITY
The subject site is well suited for the subject improvements. Property suitability i s further addressed
in the Subject Market Analysis portion of this report.
Additional exhibits relative to the subject property follow.
First Floor of the Subject Residence
(Community Center)
Clark Real Estate Appraisal (14-006es) (01/30/2014) 36
Second Floor of Subject Residence
Clark Real Estate Appraisal (14-006es) (01/30/2014) 37
Third Floor of the Subject Residence
Clark Real Estate Appraisal (14-006es) (01/30/2014) 38
Basement of the Subject Residence
(Community Center)
Clark Real Estate Appraisal (14-006es) (01/30/2014) 39
Main Floor of the Carriage House
Second Floor of the Carriage House
Clark Real Estate Appraisal (14-006es) (01/30/2014) 40
FLOOD MAP
Clark Real Estate Appraisal (14-006es) (01/30/2014) 41
SUBJECT PHOTOGRAPHS
Front entry of subject property from Willson Ave View of subject from southeast
View of subject from south View of subject from southwest
View of subject from northwest View of Porte Cochére
Clark Real Estate Appraisal (14-006es) (01/30/2014) 42
ADDITIONAL PHOTOGRAPHS
Basement entrance on west side addition Entrance to subject addition on west side
View of carriage house from north View of carriage house from southwest
View of carriage house from southeast View facing east on College Ave
Clark Real Estate Appraisal (14-006es) (01/30/2014) 43
ADDITIONAL PHOTOGRAPHS
View facing west on College Ave View facing north on Willson Ave
View facing south on Willson Ave View facing west on Harrison Ave
View facing south on Grand Ave View facing north on Grand Ave
Clark Real Estate Appraisal (14-006es) (01/30/2014) 44
ADDITIONAL PHOTOGRAPHS
Foyer North Entry of Foyer
Foyer Entry from East Front Door Foyer
Living Room Living Room Fireplace
Clark Real Estate Appraisal (14-006es) (01/30/2014) 45
ADDITIONAL PHOTOGRAPHS
Living Room Living Room
Dining Room Dining Room Cabinetry
Dining Room Solarium
Clark Real Estate Appraisal (14-006es) (01/30/2014) 46
ADDITIONAL PHOTOGRAPHS
First Floor Restroom First Floor Office
First Floor Office First Floor Library
First Floor Library First Floor Prep Kitchen
Clark Real Estate Appraisal (14-006es) (01/30/2014) 47
ADDITIONAL PHOTOGRAPHS
First Floor Prep Kitchen Basement Stairway
Basement Stairway Basement Hallway
Basement Men’s Restroom Basement Women’s Restroom
Clark Real Estate Appraisal (14-006es) (01/30/2014) 48
ADDITIONAL PHOTOGRAPHS
Basement Storage Basement Storage
Basement Mechanical Basement Mechanical
Basement Mechanical Basement Storage
Clark Real Estate Appraisal (14-006es) (01/30/2014) 49
ADDITIONAL PHOTOGRAPHS
Basement Sump Pump Stairway to Second Floor
Stairway to Second Floor Second Floor Landing
Second Floor Foyer Second Floor Foyer
Clark Real Estate Appraisal (14-006es) (01/30/2014) 50
ADDITIONAL PHOTOGRAPHS
Second Floor Bedroom Second Floor Study
Sink in Second Floor Study View of Second Floor Balcony from Study
Second Floor Master Bedroom Second Floor Master Bedroom
Clark Real Estate Appraisal (14-006es) (01/30/2014) 51
ADDITIONAL PHOTOGRAPHS
Second Floor Master Bedroom Second Floor Master Bathroom
Second Floor Bedroom Second Floor Bedroom
Second Floor Bedroom Second Floor Bathroom
Clark Real Estate Appraisal (14-006es) (01/30/2014) 52
ADDITIONAL PHOTOGRAPHS
Second Floor Bathroom Second Floor Bathroom
Second Floor Hallway Second Floor Bathroom
Second Floor Bedroom Stairway to Third Floor
Clark Real Estate Appraisal (14-006es) (01/30/2014) 53
ADDITIONAL PHOTOGRAPHS
Stairway to Third Floor Third Floor Landing
Third Floor Ballroom Third Floor Ballroom
Third Floor Ballroom Third Floor Storage
Clark Real Estate Appraisal (14-006es) (01/30/2014) 54
ADDITIONAL PHOTOGRAPHS
Third Floor Storage Third Floor Storage
Carriage House Entry Carriage House Storage
Carriage House Storage Carriage House Open Area
Clark Real Estate Appraisal (14-006es) (01/30/2014) 55
ADDITIONAL PHOTOGRAPHS
Carriage House Open Area Carriage House Open Area
Carriage House Ancillary Room Carriage House Ancillary Room
Carriage House Ancillary Room Stairway to Carriage House Loft
Clark Real Estate Appraisal (14-006es) (01/30/2014) 56
ADDITIONAL PHOTOGRAPHS
Carriage House Loft Carriage House Loft
Carriage House Loft Carriage House Loft
Carriage House Loft Carriage House Loft
Clark Real Estate Appraisal (14-006es) (01/30/2014) 57
ADDITIONAL PHOTOGRAPHS
Irrigation Well (Southwest Quadrant) Irrigation Well (Northwest Quadrant)
Parking Lot Storm Drain Parking Area Lighting
Clark Real Estate Appraisal (14-006es) (01/30/2014) 58
PRESERVATION / RESTORATION PHOTOGRAPHS
Floor Register Solid Wood Panel Doors
Scone Decorative Tile
Library Cabinetry Radiator
Clark Real Estate Appraisal (14-006es) (01/30/2014) 59
PRESERVATION / RESTORATION PHOTOGRAPHS
Fireplace Heated Bench
Light Fixtures Story Children Growth Records
Copper Downspout Outdoor Light Fixture
Clark Real Estate Appraisal (14-006es) (01/30/2014) 60
REPRESENTATIVE DEFERRED MAINTENANCE
Ceiling Damage in 2nd Floor of Story Mansion Wall Damage in 2nd Floor of Story Mansion
Light Fixture in Story Mansion Master Bathroom of Story Mansion
Temporary Heating 2nd Floor of Story Mansion Exterior Wall on Carriage House
Clark Real Estate Appraisal (14-006es) (01/30/2014) 61
REPRESENTATIVE DEFERRED MAINTENANCE
Window Sill on front of Story Mansion Porch Ceiling on Story Mansion
Clark Real Estate Appraisal (14-006es) (01/30/2014) 62
SUBJECT MARKET ANALYSIS-HISTORIC HOMES IN MONTANA
SUBJECT PROPERTY ANALYSIS
General Property Description: A complete property description detailing physical attributes, legal
restrictions and historic significance is included in a prior section of this report. The subject was
constructed as a single family residence with a carriage house in 1910. The subject is located within
the Bon Ton Historic District, which is located on the National Register of Historic Places and
surrounded by other historic homes along Willson Avenue in Bozeman, Montana. The
improvements are located on a full city block, a portion of which has been dedicated as a city park.
The subject property is encumbered with a Conservation Easement.
Analysis of Properties Identified as Historic Mansions in Montana
The subject is one of a number of properties identified as historic mansions in the state. We located
five additional properties also identified as Historic Mansions in Montana. We interviewed the
staff of each of these five historic mansions regarding details of their history and use. Sarah Nucci
is Curator of History at the Montana Historical Society and holds a bachelor’s degree in Historic
Preservation from Mary Washington College, the oldest degree of its kind in the United States.
Ms. Nucci, who has oversight of the Original Governor’s Mansion (OGM) in Helena, indicated
her opinion regarding house mansions as follows:
“Historic House Museums are rarely, unless George Washington lived there,
money makers. Weddings and special events are there, but house museum
admission isn’t a money maker. In addition, there is a stress to get repeat visitors,
as sites like the OGM are not designed to have changing exhibits and you’ll likely
only have repeats when guests are in town. I do suggest considering an adaptive
re-use goal for the site. In the years before restoration of the OGM, the state used
the building as an office for the Centennial Territorial offices. We have several
B&B’s on Ewing as well, and although lovely I don’t know how financially sound
they are. There are lots of other uses as well. Columbus Hospital in Great Falls is
now a small business shopping center that also has a housing facility in the
back. There are plenty of offices in historic homes, I read about an old armory in
Vermont that is being turned into a hotel. Hotels, housing, restaurants, and shops
are all functional for the space. Community spaces are popular options as
well. There are lots of other options that can be done besides the historic house
museum.”
Ms. Nucci also indicated that,
“It has only been in the last 10 years that the OGM has even charged admission into
the house. I know that we wouldn’t be able to pay both tour guides and have heat
and light in the house based on attendance to the site, let alone address any ongoing
maintenance and repair issues that arise. We do have fundraisers done by the
Original Governor’s Mansion Restoration Society (OGMRS) to pay for ongoing
restoration of the interior of the site. They currently host a Gala, Secret Garden
Tour, Halloween Walking Tour and the Holiday Home Tour.”
Clark Real Estate Appraisal (14-006es) (01/30/2014) 63
According to Ms. Nucci, the OGM has not had a public restroom, but plans are underway to
renovate it to include a public restroom in the near future. At that time, the state will be able to
allow events, such as wedding parties, to be held at the OGM.
Based on our interviews with a staff member from the historic house mansions identified in
Montana, we prepared the following table. In the following pages, we have included pictures of
the mansions and a discussion of the difference between the subject a nd other historic mansions in
the state.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 64
Name Address City Year
Built Size Lot Size Use Ownership
Adult
Admission &
Event Pricing
Historic & Unique
Attributes Preservation
Moss Mansion 914
Division St
Billings 1903 3 stories, 10,800
sf plus a full
finished
basement -
13,000 sf total.
Includes 28
rooms.
1.463 Acres
(more than
1/2 a City
Block)
Museum &
Community
Center (Facility
Rental,
Primarily
Grounds,
Spring - Fall)
Owned by City &
State; Operated
by Billings
Preservation
Society
$7.00/Adult
for Tour
Preston Boyd Moss,
constructed for his
family. Added to the
National Register of
Historic Places in 1982.
Unique in that all of
the Moss family
belongings have been
preserved, including
furniture, clothing,
documents, etc.
No major renovation.
It has always been
maintained &
preserved. A new
boiler put in a few
years ago and heat
registers added in
servants quarters.
Floors refinished in
the past year.
Copper King
Mansion
219 West
Granite St
Butte 1880 3 Stories, 10,868
sf plus
basement,
34 Rooms,
11 bedrooms,
5 bathrooms
0.318 Acres B&B and Tours,
and Private
event rental
Privately owned by
Erin Sigal & John
Thompson
(siblings) Owned
by the Cote Family
since 1950's
$10.00/Adult
for Tour &
$500 - main
floor event
rental
William Andrews
Clark, banker and
entreprenuer (one of
the 3 Copper Kings),
built the Copper King
Mansion for his family.
It was added to the
National Register of
Historic Places in 1970.
Receieved a Historic
Preservation Grant in
2011 to install a new
boiler, add rain
gutters, build a new
porch and paint the
entire exterior. New
roof, new carpets in
past 20 years.
Daly Mansion 251
Eastside
Highway
Hamilton 1886 3 Stories, 24,000
sf plus
basement.
Includes 50
rooms, 25
bedrooms, 15
bathrooms & 7
fire places.
50 Acres (27
acres are
Arboretum
and Garden)
Museum &
private event
facility, leased
to and
operated by
the Daly
Mansion
Preservation
Trust (DMPT).
State owned since
1986 when it was
purchased through
the Montata
Estate Tax
Forgiveness Act.
Currently, under
the umbrella of
University of
Montana, the
Mansion recieves
no funding for
operations, with
the exception of
payment for
insurance.
$9.00/Tour &
Various
Event
charges
from
$200/meetin
g to
$3,200/wedd
ing
The existing Chaffin
homestead was
purchased by Marcus
Daly, one of the 3
Copper Kings, for a
summer residence in
1886. The original
homestead was
remodeled several
times between 1886
and 1910. Added to
the National Register of
Historic Places in 1987
as "Riverside" the
name by which the
Daly's referred to the
property.
In the past decade,
approximately
$1,340,000 in Federal
Funding was provided
(part from Save
America's Treasures
Grant) and $772,000
from private
individuals and
foundations for
preservation of the
property. The Executive
Director indicated that
almost $6,000,000 in
Grants and Donations
has been invested in
the restoration of the
Daly Mansion since its
purchase.
Original
Governor's
Mansion
304 North
Ewing
Helena 1888 3 stories, Queen
Anne Style, 9,500
sf, 18 rooms total,
7 bedrooms, 2.5
bathrooms, 7
Fireplaces.
1.042 Acre House
Museum - not
currently an
event center
but looking
into that for
future.
Currently none
of the
bathrooms
accessible to
the public are
plumbed for
use.
State owned since
1913.
Administered by
the Montana
Historical Society
$8.00/Adult
for Tour
Built by entrepreneur
William Chessman as
a private residence.
Acquired by the State
of Montana in 1913 to
serve as its first
official governor's
residence. Housed 9
first families until
1959. It was added to
the National Register of
Historic Places in 1970
as "Former Montana
Executive Mansion".
Restoration began in
1969 with the support
of the City of Helena.
Conrad Mansion Woodland
Ave
Kalispell 1895 3 Stories, 13,000
sf, 26 rooms, 3
bathrooms, 8
fireplaces.
3 acres House
Museum &
event center
Donated to the
City of Kalispell in
1974 by Katherine
Conrad, daughter
of Charles Conrad.
Operated by the
Conrad Mansion
Foundation and
fully self-
supported by
event fundraising.
$10.00/Adult
for Tour and
$500 to
$1,000 for
Wedding/
Event rental
Built by Charles E.
Conrad, businessman
and founder city of
Kalispell. Designed by
Spokane Architect,
Kirtland Cutter. Added
to the National Register
of Historic Places in
1975.
According to Ex.
Director, when
purchased the Conrad
Mansion was in need
of some attention from
some years of neglect.
Initial repairs were
required and city paid
for these- the amount
invested is unknown.
In recent years, several
Montana HB465 grants
were received totaling
$521,046. One of the
grants was to repair
and stabilize the
foundation.
Historic Mansions in Montana
Clark Real Estate Appraisal (14-006es) (01/30/2014) 65
MONTANA HISTORIC MANSIONS PHOTOGRAPHS
Moss Mansion – Billings Copper King Mansion - Butte
Marcus Daly Mansion - Hamilton Original Governor’s Mansion – Helena
Conrad Mansion - Kalispell
Clark Real Estate Appraisal (14-006es) (01/30/2014) 66
Our research indicates that:
the most notable historic house mansions have been used as a house museum, or a
museum/event center or as a bed & breakfast/event center;
of the 5 house mansions identified, 4 are owned by their respective cities or by the state
and 1 is privately owned and operated as a bed and breakfast;
of the 4 house mansions that are owned by a city or the state, all were purchased or donated
to the city or state prior to 1986, which is when the Daly Mansion was purchased through
the Montana Estate Tax Forgiveness Act;
three of the house museums are operated by non -profits and are self-supporting, but these
are also rented for wedding and social events.
The subject differs from the typical house mansions in the state in that:
the subject was not donated to the city or state but was purchased in 2003;
the subject was in need of extensive renovation to ensure its preservation, whereas the
majority of the house mansions were in better repair at the time they were donated and the
upkeep of them has been continued since they were donated ;
the subject is not operated by a non-profit that holds fundraising events and has a dedicated
executive director seeking private funding;
the subject is encumbered by a conservation easement that requires approval for any
renovations or alterations and al so requires the subject be open to the public at least 12
days per year (approximately once per month).
Historic Preservation Easements
We have researched Historic Preservation Easements and sought sales of historic homes with
similar Conservation Easements. Although they may exist, they are not common in Montana, even
among historic homes that are listed on the National Register of Hi storic Places. We did not locate
any sales of similar historic properties encumbered with Conservation Easements similar t o the
subject in Montana. For this reason, it was necessary to use alternative sources to determine
whether or not the easement on the subject property impacts marketability. We prepared a search
for peer reviewed articles published that address impact on value due to Historic Preservation
Easements. A table with the articles we relied on to research this topic is on the following page.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 67
Additionally, we interviewed Pete Brown, Historic Architectural Specialist with the Montana State
Historical Preservation Office in Helena. According to Mr. Brown, he knows of no other
residential properties comparable to the Story Mansion that have similar preservation easements.
Most preservation easements were with regard only to renovations and alterations rather than
requiring public access.
We also interviewed Judith Reynolds, MAI, who has written articles and a book addressing
Historic Preservation Easements. According to Ms. Reynolds, although she indicated she had
heard of conservation easements that required the entrusted property be open to the pu blic, the
more common historic preservation easement is for preservation of the historic improvement.
According to Ms. Reynolds, easements like the subject Conservation Easement do diminish the
Author(s)Title Source Summary of Article
Huso, Deborah
R.
"This Old Write-Off"Valuation, published
by The Appraisal
Institute, Third
Quarter, 2012;
Volume 17, Number
Three
In the 1990s and early 2000s many non-profit
organizations were promoting façade easements for
historic properties and claiming the IRS had a 10 to 15
percent rule for determining diminution of value in
historic preservation easement properties; however,
there was no such rule and IRS eventually
commissioned market studies in major cities where
easements were being established. The studies
showed 3 to 5 percent reduction in values, but not 10 to
15 percent.
Valuation Staff
Writers
"The Case that Started it All:
Internal Revenue Service Vs.
Simmons"
Valuation, published
by The Appraisal
Institute, Third
Quarter, 2012;
Volume 17, Number
Three
The Internal Revenue Vs. Dorothy Simmons, is a
landmark case that determined that there was no 10 to
15 rule for determining diminution of value in historic
preservation easement properties. The case started
when façade easements were granted by Dorothy
Simmons on two historic row houses to a local nonprofit
that held the easements. In 2006, the IRS denied the
deductions taken ($162,500 and $93,000). In 2009, the
U.S. Tax Court ruled that there was only a 5% loss in
value, entitling deductions of $56,250 and $42,250,
respectively.
Valuation Staff
Writers
"Evasive Actions"Valuation, published
by The Appraisal
Institute, Third
Quarter, 2012;
Volume 17, Number
Three
IRS compliant appraisals for tax deductions for historic
easements requires a significant body of market
evidence. Tamara Papas, SRA, Of Pinnacle
Performance, Inc., who specializes in historic
preservation easement valuation in Washington, D.C.
says that "in some cases an easement can actually add
value to a property. You need four or five comps on both
sides."
Reynold, Judith,
MAI
"The Costs & Benefits of Historic
Properties"
The Appraisal
Journal, Spring 2006
Article examines 9 questions that should be asked by
an appraiser regarding historic properties and the
valuation of them in order to isolate any special costs
and benefits that accrue to the property, including those
related to Conservation Easements.
Kilpatrick, John A.
& Adams, Victoria
B.
"Preservation Easements"The Journal of
Wealth Management,
Summer 2008
The authors cite the benefits of historic preservation
easements but also discuss the requirements by the
IRS for an appraisal that provides market support of the
diminution in value. They also cite the negative impacts
of historic preservation easements such as 1) the
possible additional maintenance costs and 2) the
owner gives up the legal right to re-develop the property
to its possible highest and best use and must accept
the permitted use(s) of the historic easement.
Summary of Articles Referenced Related to Valuation of Historic Conservation Easements
Clark Real Estate Appraisal (14-006es) (01/30/2014) 68
fee simple bundle of rights and it is reasonable to expect ma rket participants to consider that there
would be at least 5% diminution in value.
A ruling by the U.S. Tax Court, noted in the prior table, indicates that a 5% loss in value was also
reasonable for a façade easement.
Based on the data available to the appraisers, we estimate the subject Conservation
Easement would indicate a diminution in value of 5%.
Analysis of Return on Renovation/Restoration Dollars for Historic Properties
Our research indicates that restoration costs of historic properties do not always equate to a
commensurate increase in market value. The table below provides details of 2 closed properties
and 1 listed property that have been renovated.
The data above indicates a gain of between 6% and a loss of more than 26% on the overall total
investment. Additionally, we interviewed realtors who indicated that the cost of restoration was
not always realized at time of sale. We discuss, in the Forecast of Competitive Supply that follows
in this section, an active listing in Bozeman that has been historically renovated and has been
marketed for a number of years at a price that is well above market.
POTENTIAL PURCHASERS OR USERS OF THE SUBJECT PROPERTY
Potential purchasers of the subject would be preservation minded individuals or entities interested
in owning a historic residence that would be open to the public at least 12 days per year and
includes as an amenity a 1-acre city park. Additionally, it would be a n individual or group willing
to renovate the remainder of the property, including the 2 nd and 3rd floors of the subject main
residence and the carriage house main floor. It is important to note that three of the four closed
comparable sales of historic properties that we located were purchased with the intent of use as
private residences.
When the City most recently solicited proposals, four organizations responded. The table on the
following page summarizes the four interested organizations and their proposals (Source: City of
Bozeman).
Comp #Address Prior Sale
Prior Sale
Price Renovation Details
Estimated
Renovation Cost
Recent Sale
Date
Recent
Sale/List
Price Gain/(Loss)
Percentage
Gain or Loss
on total
investment
2 504 S Willson Ave, Bozeman 8/12/2009 $900,000 Complete Historic Renovation $1,000,000 7/10/2012 $1,400,000 ($500,000)-26.32%
3 1330 Gerald Ave, Missoula 9/19/2008 $862,000
Renovations included new wiring, new HVAC,
asbestos mitigation, plumbing, insulation
throughout home, plaster and updated
kitchen and bathrooms. $200,000 8/31/2012 $1,125,000 $63,000 5.93%
A1 1003 2nd Avenue NW, Great Falls 6/5/2008 $305,000
Prior to being purchased this property had
been vacant for a while and been neglected
and was in disrepair. Current owners
purchased for a B&B andrenovated kitchen,
bath, and a number of additional projects.
They did much of the repair and renovation
themselves.
Owner's hope
to break even
on the
renovation
expense, but
they did most
of the labor on
projects.ACTIVE*$395,000 Unknown N/A ACTIVE
Return on Renovation Investment
Clark Real Estate Appraisal (14-006es) (01/30/2014) 69
According to our research, if the subject is sold to an owner in the private sector, the owner may
be eligible for tax benefits based on the subject’s inclusion in the National Register o f Historic
Places. The subject is currently owned by the City of Bozeman and such a credit is not available.
The table below indicates some of the possible sources of tax incentives.
The Montana Historic Preservation website provides additional details of the federal and state tax
credits. This information is presented below:
Federal Tax Credit
The Federal Historic Preservation Tax Incentives Program encourages private sector rehabilitation
of historic buildings and is one of the Nation's most successful and cost -effective community
revitalization programs. It generates jobs and creates moderate and low-income housing in historic
buildings.
Funding Source Contact Information
Federal Tax Credit http://www.nps.gov/history/hps/tps/tax
State of Montana Tax Credit http://data.opi.mt.gov/bills/mca/15/31/15-31-151.htm
Local Government Initiatives Various
Tax Increment Financing Specific to Various Cities in Montana
Special Districts for Business
Improvement, Parking & Other
Infrastructure
Specific to Various Cities in Montana
Local Mill Levy Specific to Various Cities in Montana
Tax Incentive Tools
Clark Real Estate Appraisal (14-006es) (01/30/2014) 70
In general, a tax credit is a dollar-for-dollar reduction in the amount of taxes owe d.
The amount of credit under this program equals 20% of the qualifying costs of rehabilitation.
Private residences do not quality for this program. Eligible properties must have an income
producing use upon project completion. Income producing properties are typically
commercial, business, and rental properties.
A project must be “substantial” in that qualifying rehabilitation expenses must exceed the
greater of $5,000 or the adjusted basis of the building.
A building needs to be certified as a historic structure by the National Park Service.
Rehabilitation work has to meet the Secretary of the Interior’s Standards for Rehabilitation as
determined by the National Park Service.
The federal credit can be put towards one year of back taxes and claimed incrementally over a
period of 20 years.
The National Park Service administers the tax credit program at the national level; The State
Historic Preservation Office (SHPO) serves as liaison between the applicant and NPS. For
further information on the program visit http://www.nps.gov/history/hps/tps/tax.
The amount of tax savings is dependent upon rehabilitation and restoration costs.
State of Montana Tax Credit
The State of Montana also has a rehabilitation tax credit program that piggybacks the federal
program. If a Montana tax payer is certified for the federal credit that person (or entity) also meets
the qualifications to claim the Montana credit. Successful applicants to this program will earn a
state income tax credit equal to 25% of their federal credit (5% of the qualified costs associated
with rehabilitation). The amount of tax savings a buyer would receive is dependent upon
rehabilitation and restoration costs. For further information on the state tax credit visit:
http://data.opi. mt.gov/bills/mca/15/31/15-31-151.htm
In some markets, these tax credits are marketable, but they are not typically marketa ble at 100%
of the tax credit value. In markets where these are recognized, we understand that the tax credits
may be marketable from 70% to 80% of the total tax credit value.
State Tax Abatement Programs
In addition, Montana historic properties that meet certain criteria established by a review process
may receive a tax abatement during the construction period, not to exceed 12 months, and for up
to 5 years following completion of the construction. The tax abatement is limited to 100% of the
increase in taxable value caused by the rehabilitation, restoration, expansion, or new construction.
The total amount of estimated taxes when rehabilitated is reduced by the estimated taxes had the
building not been rehabilitated and this provides estimated tax sa vings. Information on this
program is available on the following website: http://leg.mt.gov/bills/mca/15/24/15 -24-1603.htm
Additional Sources of Funding
The Montana State Historic Preservation Office (SHPO) provides a document with additional
funding sources available on the SHPO website at http://mhs.mt.gov/shpo/HPFunding.pdf. This
document includes descriptions of funding sources and programs that are available to assist historic
preservation projects.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 71
In some cases the suggested sources are not necessarily focused on historic preservation but may
be used for projects that have mul tiple objectives. The various funding sources are organized by
federal, state and foundation sources. The tables are presented below and on the following page.
Funding Source Eligibility Requirements
Potential Dollar
Amount(s)Notes Contact Information
Federal Grants Various Various
Over 1,000 grant programs
providing access to approximately
$400 billion in annual awards.
www.grants.gov
US Department of Commerce, Economic
Development Administration
Governments, Indian Tribes,
Economic Development Districts,
Non-Profits, Universities, & Other
Higher Education
$25,000 to $2,000,000 www.eda.gov
Institute of Museum & Library Services Museums & Libraries Up to $150,000 www.imls.gov
National Endowment for the Humanities 501(c)(3)Various www.new.gov/grants
National Endowment for the Arts Museums & Other Exhibiting
Organizations $5,000 to $200,000 www.nea.gov
Preserve America (National Park Service)
Historic Preservation Officers
(State, Tribal) & Designated
Communities
$30,000 to $250,000 www.preserveamerica.gov
Save America's Treasures (National Park
Service) Not Available in FY 2012 www.nps.gov/history/hps/treasures
USDA Rural Development Various - See Website Various - See Website www.rurdev.usda.gov
Montana Department of Commerce,
Community Development Block Grants
Incorporated Cities, Towns,
Counties & Consolidated City-
County Governments
$20,000 to $450,000 (406) 841-2777
Montana Department of Transportation,
Community Transportation Enhancement
Program
Local & Tribal Governments Various www.mdt.mt.gov/business/ctep
Montana Arts Council, Montana Cultural
Trust: Culture and Aesthetics Grant
Program
Various Various - See Website www.art.mt.gov/about/about_culturalgrants.asp
State Historic Preservation Office,
Montana Historical Society, Montana
Preserve America
Not Available in FY 2012 www.mhs.mt.gov/shpo/preserveamerica
State Historic Preservation Office,
Montana Historical Society, Rural Property
Brick and Mortar Grant
Not Available in FY 2012 www.mhs.mt.gov/shpo
Montana Department of Commerce, Special
Events Grants Program
Montana Non-Profit Entity, City,
County, or Tribal Government $2,500 to $80,000 www.travelmontana.mt.gov
Montana Department of Commerce,
Tourism Infrastructure Program Grant
Non-Profit Organizations &
Communities Up to $20,000 www.travelmontana.mt.gov
Federal & State Grant Information
Funding Source Contact Information
3 Rivers Communications www3rivers.net
Ash Gove Charitable Foundation (913) 451-8900
Browning-Kimball Foundation (406) 454-1433
Butte Citizens for Preservation and
Revitalization www.butteepr.org/grants.htm
The Foster Foundation info@thefosterfoundation.org
Humanities Montana info@humanitiesmontana.org
J.M. Kaplan Fund www.jmkfund.org
Jerry Metcalf Foundation www.jerrymetcalffoundation.org
Lower Flathead Valley Community
Foundation, Inc.www.lfvct.info
M.J. Murdock Charitable Trust www.murdock-trust.org
MDU Resources Foundation http://www.mdu.com/coprorateresponsibility/foundation
Montana Historical Foundation mthistory.org
Montana Preservation Alliance, Montana's
Endangered Industrial Architecture Grant http:/www.preservemontana.org
National Trust for Historic Preservation www.preservationnation.org/mpo
Town Pump Charitable Foundation www.townpump.com/index.aspx/coporate/community_giving
2010 Tourism Cares Worldwide Grant
Program www.tourismcares.org
Foundations & Organizations Offering Grant Dollars
Clark Real Estate Appraisal (14-006es) (01/30/2014) 72
Federal and State tax credits are dependent on whether an owner is a private or non -profit entity.
The amount of the credit is based on the cost of rehabilitation. It is unknown whether any of the
tax credits, abatements or grant opportunities will be applicable and how their possible availability
may impact value. Such opportunities are more related to an investment value, one that is for a
specific investor or class of investors, rather than market value. We have not adjusted the market
value that considers these factors but have provided this information as a service to the client.
Potential users of the subject property would be individuals or groups seeking to rent a unique and
historic venue for the purpose of a family gathering, a wedding, a social event or a professional
organization meeting place. If the subject were sold and t he use changed from Community Center
to another use, such as lodging or single family residence, potential users may change or expand.
DEMAND FROM PURCHASERS
Demand noted in prior years for historical residences can shed light on future demand. The past
sales activity of historical residences in the greater Bozeman market area is included on the table
on the following page.
The chart above represents the Inferred Demand which is based on historical demand for similar
properties in prior years, based on data from the Southwest Montana Multiple Listing Service.
Montana is a non-disclosure state and not every sale transfers via the area MLS; however, the MLS
data is considered to provide an accurate depiction of general trends in real estate trans fers.
The data in the chart above is based on properties located within the city limits of Bozeman,
constructed prior to 1931, and with at least 2,500 square feet of finished space above grade. There
have been 36 sales meeting this criteria over the past decade. This indicates historical demand for
somewhat similar properties in the subject market area has been approximately 3.6 properties per
year for the past 10 years.
The median size of the finished area above grade for these properties was 3,059 square feet and
the median price was $157 per square foot. Thirty-four of the properties were located on lots that
were less than 1 acre in size and 2 of the properties were located on lots between 1.1 and 5.9 acres
in size.
5 6 5 1 2 1 4 2 6 4
$144
$180
$207
$147
$199
$132
$168
$118
$196
$281
$0
$50
$100
$150
$200
$250
$300
0
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10
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S
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Period (Years)
Prior Sales of Historic Homes in City of Bozeman
Number of Sales per Year Average Price Per SF
Source: SW Montana MLS Market
Clark Real Estate Appraisal (14-006es) (01/30/2014) 73
Data indicates that prices have been trending upward since 2011 but the annual number of sales
has been a statistically small number (less than 30 sales per year). Caution must be used with
small data sets since they are subject to data-specific influences that can skew averages. This
does not mean that prices are not trending upward, but asserting a specific quantitative market
conditions adjustment based on the changes in price per square foot of a few sales may be
erroneous. It is appropriate to place more emphasis upon larger data sets, such as single -family
residential sales in the Bozeman market. In the Residential Home Sales of the Bozeman Economic
Data that is presented in the addendum of this re port, we have noted a more modest increase of
9% from 2012 to 2013.
FORECAST OF COMPETITIVE SUPPLY
As of the effective date, there was 1 active listing of a historical property in the City of Bozeman
with more than 2,500 square finished above grade. In overall size, it is much smaller than the
subject property and does not include an accessory building. The property is a 2-story, residence
located in the Bon Ton Historic district. According to the listing agent, the property was
constructed in 1910 but has been completely renovated since it was purchased privately in 2004.
Historic preservation techniques were used in the renovation and updates include: new electrical
service, wiring, and museum-quality low-voltage lighting throughout, new windows, new
plumbing, new hot water HVAC system, refurbished hardwood floors, new roof, trim and siding.
The residence is 2,536 square feet in size with a 1,268 square foot unfinished basement. It includes
8 rooms, 3 of which are bedrooms and 2 bathrooms. Based on our interview of the listing realtor,
the owner has spared no expense to restore and preserve the historic features of this property. The
quality and condition of this property are both considered excellent. This property is listed for
$1,475,000 or $582 per square foot. This is more than double the average price per square foot of
other historic properties sold in Bozeman in 2013. The active listing is somewhat smaller in size
than the subject property. This property has been listed nine times since 20 09 for list prices ranging
from $1,395,000 to $1,475,000. The number of days on market for each listing ranged from 67 to
225 days and total 1,273 cumulative days as of the effective date of this report. The number of
days on market would likely suggest that this active listing is priced above market.
INTERACTION OF SUPPLY AND DEMAND
Based upon the average annual demand of 3.6 properties per year for the last 10 years, there is less
than a 1 year supply of historic residences available for sale in the Bozeman market area. The list
price per square foot of the one active listing is 207% higher than the 2013 average price per square
foot of $281.
Based on the average number of sales (3.6) and the number of active listings (1), the demand is
higher than the supply ; however, market data also indicates that motivated sellers must provide
a reasonable market price in order to attract a buyer.
FORECAST OF MARKETING AND EXPOSURE TIME
The average marketing time for similar properties in the subject mar ket area was 202 DOM over
the past decade. The average marketing time in 2013 was 348 days. In order for the subject
property to sell in a reasonable time a competitive price is necessary. The values indicated in this
report are based upon a 9 to 12 month marketing time for the subject property. The exposure
time for the subject property is also estimated to be between 9 to 12 months.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 74
SWOT ANALYSIS
Strengths
The subject is a unique, historic mansion.
The subject has been renovated to very high, historic preservation standards on the exterior
and has been partially renovated on the interior.
The subject is located on one full city block in the Bon Ton Historic District.
The subject is recognized on the National Register of Historic Places.
The subject includes a park amenity.
Historic preservation guidelines of the Secretary of Interior will help preserve the subject.
Weaknesses
The subject renovation is incomplete and the exact cost to cure is unknown.
Maintenance costs for large, historic properties may be substantial.
Income derived from a house mansion/community center does not typically represent the
highest and best use of a historic home.
Opportunities
Limited marketing through Requests for Proposals has produced 4 parties interested in the
purchase or gifting of the Story Mansion.
A variety of grant funding opportunities may be available to the owner or a future buyer based
on money spent on further preservation.
Tax credits may be available to a future buyer if the buyer is a private individual or entity and
the use of the subject is income producing.
The City of Bozeman has the authority to revoke the Conditional Use Permit that is in place
and possibly to allow for a different use other than a Community Center.
Threats
The cost to cure and the commitment to restore the property based on historic preservation
guidelines may be a deterrent to some prospective buyers.
The Conservation Easement that requires the owner to open the subject to the public at least
12 times per year may be a deterrent to some prospective buyers.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 75
HIGHEST AND BEST USE
The four basic economic principles of supply and demand, substitution, balance and conformity are
considered to be the basic tools of analyzing the relationship between economic trends and an
appraisal. Market forces create market value. For this reason, the analysis of highest and best use is
very important. When the purpose of an appraisal is to estimate market value, a highest and best use
analysis identifies the most profitable, competitive use for which a property can be used.
It is important to recognize the possibility that the Highest and Best Use of the land could differ from
the Highest and Best Use of the property. This occurs when a site has existing improvements and the
Highest and Best Use of the land differs from the current use. Often, the current property use will
continue until the value of the land, under its Highest and Best Use, less existing improvement
demolition costs, exceeds the total value of the property in its present use.
The Highest and Best Use analyses and conclusions are included on the following page.
According to The Appraisal of Real Estate - Thirteenth Edition by the Appraisal Institute, Highest and
Best Use is defined as follows:
"Highest and best use is the reasonably probable and legal use of vacant land or an improved
property that is legally permissible, physically possible, appropriately supported, and financially
feasible and that results in the highest value."
The analysis for Highest and Best Use considers first the reasonably probable uses of a sit e that can be
legally undertaken. The final Highest and Best Use determination is based on the following four criteria:
Legally Permissible:
The availability of land for a particular use in terms of existing regulations and restrictions, deed
restrictions, lease encumbrances, or any other legally binding codes, restrictions, regulations,
or interests.
Physically Possible:
The physical adaptability of the site for a particular use.
Financially Feasible:
All uses that are legally permissible and physically possible that are likely to produce an income,
or return, equal or greater than the amount needed to satisfy operating expenses, financial
obligations, and capital amortization are considered to be financially feasible.
Maximally Productive:
Of the financially feasible uses, the use that produces the highest net return or the highest
present worth.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 76
AS IF VACANT
Legally Permissible
The subject property is located within the R-1, Residential Low Density Zoning District. Within
this zoning district, permitted uses include single -family dwellings, community residential
facilities with eight or fewer residents, essential services for water and sanitary sewer lines, family
day care homes, group day care homes, group living, public and private parks, manufactured
homes on a permanent foundation, and townhomes when utilized to satisfy the requirements of
Affordable Housing. In addition to the primary allowable uses, a Conditional Use Pe rmit (CUP)
was approved by the City of Bozeman that allows use of the subject property as a Community
Center.
Lo t 1A-2 is 1.1092 acres in size and is dedicated as parkland and as such, may not be developed.
The subject property as improved is encumbered by a Conservation Easement; however, the
easement is based on the existence of the improvements; therefore, since this analysis is related
to the Highest and Best Use As If Vacant, we have not considered the Conservation Easement
in the As If Vacant analysis.
Physically Possible
The subject is comprised of two lots that total 2.147 acres as assembled and are located on a full
city block. The topography of the subject is level. Utilities are available to the property and there
is access to city water and sewer, as well as two private wells for irrigation of the subject property.
There is sufficient area for any of the allowable uses. The subject has good access from Grand
Avenue on the subject west boundary. As noted above, only Lot 1A-1 may be developed.
Financially Feasible
The subject site is located in an area of other historic homes. Single -family residential
development is feasible. Nearby lot sizes range from 0.14 to 0.38 acre. Since these are all
considerably smaller in size than the subject Lot 1A-1, the subject would likely be purchased for
residential subdivision development as approximately 4 lots.
Maximally Productive
Based upon this analysis of the legally permissible, physically possible and financially feasible
uses of the subject property, the maximally productive highest and best use as if vacant of Lot 1A -
1 is residential subdivision development and of Lot 1A-2 is parkland.
AS IMPROVED
Legally Permissible
The allowable uses in the R-1 zoning district and the CUP were discussed above. In addition to
the allowable uses, the subject is also encumbered by a Conservation Easement with approximately
45 years remaining that requires that any alterations or renovations meet certain historic
preservation standards. The Conservation Easement also requires that the subject be open at least
12 days per year to the public, with equitably spaced timing, and that those dates be made available
to the public. This encumbrance does not preclude any of the allowable uses, but it does diminish
the fee simple bundle of rights and would likely reduce the number of market participants and
negatively impact market value .
Clark Real Estate Appraisal (14-006es) (01/30/2014) 77
Physically Possible
The subject is comprised of two lots that total 2.147 acres as assembled and which are located on
a full city block. The topography of the subject property is level. Lot 1A-1 of the subject is 1.0378
is improved with a historic residence and a carriage house. The residence was renovated and
converted to Community Center. Lot 1A-2 of the subject is 1.1092 acres in size and is dedicated
as parkland. There is sufficient area for the improvements on Lot 1A-1. The subject property has
good visibility from all sides. The subject has good access from Grand Avenue on the subject west
boundary.
Financially Feasible
The subject is located in a neighborhood of historic homes that are predominantly utilized as sin gle
family residences. The subject property has been utilized as a community center. A legally
permissible alternative use is a Bed and Breakfast. We have analyzed the financial feasibility of
all three uses in the following paragraphs.
Community Center
As noted the subject property is being utilized as community center. We were provided by the
subject property owner with the income and expense information for 2009 through 2013. The
information provided to us is included in the Addendum portion of this re port. The income and
expense data from the City does not include any consideration for property insurance or any
overhead expenses for staff time allotted to facilities maintenance, park maintenance, or
administration.
Even without accounting for the administrative and maintenance staff, the net operating income is
negative for the Community Center. This analysis indicates that continued use as a community
center is not financially feasible. This conclusion is supported by our research of properties
identified as Historic Mansions in Montana.
Bed & Breakfast
According to our research, Bed and Breakfast use is common for historic homes in the state. This
is also a conditional use under the R-1 zoning district. For these reasons and in order to identify
the highest and best use of the subject as improved, we have analyzed the subject property as a bed
and breakfast using income approach techniques.
Cost of Renovation: In order to prepare this analysis we first determined a reasonable cost to
update the prep kitchen to a commercial kitchen and renovate the 2 nd and 3rd floors of the subject
main residence. Our projections of the necessary r enovation for subject for use as a B&B would
include renovating 6 bedrooms with adjoining bathrooms on the 2nd floor and renovation of the 3rd
floor for use as the owner/manager’s quarters to include 2 bedrooms, a bathroom, a kitchen and
living area.
Effective Gross Income $25,000
Less Estimated Expenses $26,000
Net Operating Income ($1,000)
Analysis of Subject as Community Center
Based on 2014 Forecast
Clark Real Estate Appraisal (14-006es) (01/30/2014) 78
We located two cost comparables and one projected cost comparable. The table below indicates
the properties we relied on for this analysis.
The first property considered is the renovation of the subject main floor and basement for
use as a Community Center.
The second is the projected cost for renovation of the Borden Hotel in Whitehall. The
Borden Hotel was purchased by the Jefferson Local Development Corporation in February
2010 for $20,000. As of December 2011 the Borden Hotel was listed on the National
Register of Historic places. It is to be renovated by a combination of public and private
funds in 2014. The main floor will consist of office and retail space and the upper floor
will consist of 7 apartments. The Borden had significant water damage on the upper floor
prior to being purchased. It is in need of extensive renovation. Was this published
somewhere – We need to make sure we are not violating client confidentiality
The last property we considered is the 2010 renovation of the historic Sears Building in
Butte. The Sears Lofts Building is located in the Butte -Anaconda National Historic
Landmark District, the nation’s largest historic district. The five -story building is
approximately 55,000 square feet in size. It was purchased in 2006 by a former resident of
the area for $10,000. The first floor was renovated for use as a food market and additional
commercial space. The upper floors were developed as 34 a partment units. Most of the
apartments include 1 and 2 bedroom units which range in size from 674 square feet to 1,049
square feet. There are also three “penthouse” units with over 1,500 square feet each. The
apartment units in the Sears Lofts Building inc lude hardwood flooring, granite countertops
and maple cabinets.
We have accorded most weight on the cost to renovate the subject main floor and basement, with
secondary emphasis on the two remaining cost comparables. Based on this data, a reasonable
cost estimate is $200 per square foot, which would also cover the cost to update the prep
kitchen to a commercial type kitchen. Based on the size of the 2nd and 3rd floors, the cost of
renovation would likely be $1,258,000 (6,290 square feet X $200/sf).
As a Check of Reasonableness, we have included the 2009 Estimate of the Cost to Renovate the
2nd floor and 3rd floors as presented by the City in the “Story Mansion and Carriage House
Condition Report as of January 27, 2011”.
Project Name - Building Location
Renovation
Completion Adaptive Re-Use Renovation Cost Size in SF
Renovation
Cost/SF
Subject Story Mansion, (Main & Basement)Bozeman 2009 Community Center $1,335,062 4,470 $299
Borden Hotel (Est. Cost to Renovate)Whitehall 2014
Commercial Main &
Apartments Upper $1,444,000 13,000 $111
Historic Sears Lofts Building Butte 2010
Retail Main,
Upper 4 Floors - Apartments $8,000,000 55,000 $145
$145.45
$185.07
Analysis of Cost to Renovate Subject 2nd & 3rd Floors
Median
Average
Clark Real Estate Appraisal (14-006es) (01/30/2014) 79
Based on this 2009 forecast as adjusted for inflation at 2% annually, a cost of $233 per square foot
is indicated ($1,462,682/6,290 SF). The total is higher than we have used in our estimate but some
costs estimated by the city would not necessarily be required of a bed and breakfast and some costs
required of a bed and breakfast would not necessarily be required of the city. Examples include:
1) an elevator and stair tower are estimated at $665,337, but a B&B would not necessarily include
the same; 2) the 3rd floor finishes are not included in the city’s estimate but some renovation of the
3rd floor would be required for the owner/manager quarters.
Average Daily Rate: In order to analyze the subject as a Bed & Breakfast establishment, we had
to determine a reasonable average daily rate (ADR). We have located four Bed & Breakfast rates
for historic homes in the state. All four are located on the National Register of Historic Places.
The Collins Mansion is listed individually, while the remaining three are listed within a historic
district. The table below indicates the estimated average nightly rate based on rate ranges for these
four establishments.
The subject is most similar in location to the Voss Inn and Lehrkind Mansion. Situated along
South Willson Avenue, between the Central Business District (CBD) of Bozeman and the MSU
campus, the subject is superior in location to all but the Voss Inn. Like the subject, The Voss Inn
is located along South Willson near Bozeman’s CBD; however, it was most recently renovated in
Description
2009
Estimate 2010 2011 2012 2013
2014 Estimate
at 2.0%
Inflation
Structural Upgrades for 2nd & 3rd Floor - selective
demolition, and new wood access stairway with
metal handrails from 1st to 3rd Level, reconfiguring
partitions at the new stairway
$128,680 $131,254 $133,879 $136,556 $139,287 $142,073
Elevator & Stair Tower $602,616 $614,668 $626,962 $639,501 $652,291 $665,337
Parking Lot upgrades for 20 additional spaces to meet
code for added usable square footage
$63,500 $64,770 $66,065 $67,387 $68,734 $70,109
2nd Floor Interior Finish Proposals for office space,
bathroom, restoration of doors, reconfigure fire
system, reconfigure hot water heating system lines,
electrical and lighting upgrades (low estimate)
$530,000 $540,600 $551,412 $562,440 $573,689 $585,163
Total Estimated $1,324,796 $1,462,682
Estimate for Cost to Renovate 2nd & 3rd Floors
Source: Story Mansion & Carriage House Conditon Report as of January 27, 2011
Name Location/Historic District
Quality/
Condition Rate Range
Est. Avg.
Daily Rate
(ADR)
Copper King Inn Butte-Anaconda Historic District Exc/Gd $85 -$135 $120
Collins Mansion Collins Mansion - Great Falls Exc/Gd $89-$135 $120
Voss Inn Bozeman - Bon Ton Historic District Exc/Avg $120-$140 $130
Lehrkind Mansion Bozeman - Brewery Historic District Exc/Gd $119 - $239 $190
Subject Bozeman - Bon Ton Historic District Exc/Exc $140 - $250 $200
B & B Estimated Average Daily Rate
Clark Real Estate Appraisal (14-006es) (01/30/2014) 80
1984 and is considered inferior based on condition to the renovated areas of the subject property.
In our opinion, it would not command the same rates as the subject as renovated. Based on this
data, a reasonable ADR is estimated at $200/room/night.
Gross Revenue Multiplier Analysis for a B&B: A form of income analysis often used for Bed &
Breakfast facilities is a gross revenue multiplier (GRM). According to Don Lindner, MAI and
president of Coastal Realty Consultants in Savannah, Georgia, “B&B sales (in Savannah) in
general have sold for 3.5 times room revenue.” Savannah has a thriving tourism economy and has
many historic B&Bs.
We located two Montana properties for GRM analysis. The Collins Mansion is a 5 room B & B
that is an active listing in Great Falls. The listing agent has had a number of interested parties and
she believes it is priced competitively. The sale price will likely be less than the list price, but
based on the fact it is priced competitively, we have adjusted the list downward by only 5%. We
estimated room revenues at $262,800 (6 rooms X $120/night X 365 days per year).
The Voss Inn, located in the Bon Ton Historic District along South Willson in Bozeman has been
marketed a number of times since 2007, originally for $1,700,000. It was listed most recently
from June 2012 through October 2012 for $895,000. Since it has been listed a number times over
the course of the past 7 years and was most recently marketed for 142 days, we have adjusted the
list price downward by 15%.
We have put most emphasis on the Voss Inn located in Bozeman; however, the subject as
renovated would likely indicate a slightly higher GRM. Based on this data, a GRM of 3.0 is
reasonable. The estimated room revenue is $438,000 (6 rooms X $200 ADR X 365 days ) X 3.0
GRM = $1,314,000. The indicated value of $1,314,000 less the estimated $1,258,000 cost to
renovate, is positive - indicating that the project is financially feasible. This analysis provides an
indication of a residual value of the property of $56,000.
Single Family Residence
We located a number of sales of similar properties in population centers of Montana. All were
purchased for residential use. These sales were utilized to develop a Sales Comparison Approach to
determine the value of the subject property. The value indication from the Sales Comparison
Approach for the subject property as a single family residence far exceed the residual value indication
for the subject property if utilized as a Bed and Breakfast.
Conclusion
Based upon our research and the analyses presented the financially feasible use of the subject
property is as a single family residence.
B&B Name Location List Price Adj. List
Est. Room
Revenue GRM
Collins Mansion Great Falls, MT $445,000 $422,750 $262,800 1.61
Voss Inn Bozeman, MT $895,000 $760,750 $284,700 2.67
Typical B&B Savannah, GA 3.50
GRM Analysis
Clark Real Estate Appraisal (14-006es) (01/30/2014) 81
Maximally Productive
Based upon this analysis of the legally permissible, physically possible and financially feasible
uses of the subject property, the maximally productive highest and best use is for a sin gle family
residence.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 82
CONSIDERATION OF FOUR PROPOSALS
The City of Bozeman release d a Request for Proposals in 2013. The table below indicates the
proposals received by the city as of August 2013 and their zoning implications.
We have not examined the financial feasibility of the subject based on the hypothetical use of any
of the proposed projects. It is beyond the Scope of this report to have done so since we were not
provided with details of renovation costs or projected income and expenses for each project.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 83
THE APPRAISAL PROCESS
In the foregoing sections of this report, we have examined and discussed the subject property. To
arrive at an estimate of market value for the subject property, it is necessary to collect and analyze all
available data in the market, which might tend to indicate the value of the subject property. The subject
property must be compared to similar properties that can be constructed, purchased, or from which a
similar monetary return may be received.
In the remainder of this report we develop the Cost Approach and the Sales Comparison Approach.
Although the subject does produce some income, it is not enough to cover expenses and it is not
currently encumbered with a long term lease; therefore, the Income Approach is not applicable to the
valuation of the subject property. The value indications are reconciled for a final value conclusion
of the fee simple interest as encumbered by the Conservation Easement.
APPROACHES IN THE VALUATION OF REAL PROPERTY
The three recognized approaches in the valuation of real property are Sales Comparison,
Cost Approach and Income Capitalization. According to The Appraisal of Real Estate -
Thirteenth Edition by the Appraisal Institute, the approaches are defined as follow s:
Cost Approach
A set of procedures through which a value indication is derived for the fee simple
interest in a property by estimating the current cost to construct a reproduction of (or
replacement for) the existing structure, including an entrepreneur ial incentive;
deducting depreciation from the total cost; and adding the estimated land value.
Adjustments may then be made to the indicated fee simple value of the subject
property to reflect the value of the property interest being appraised.
Sales Comparison Approach
The process of deriving a value conclusion for the subject property by comparing
similar properties that have recently sold; identifying appropriate units of comparison
and making adjustments to the sales prices (or unit prices) of the c omparables based
on the relevant, market-derived elements of comparison. The Sales Comparison
Approach may be used to value improved properties, vacant land or land being
considered as though vacant when an adequate supply of comparables sales is
available.
Income Capitalization Approach
An appraiser analyzes a property's capacity to generate future benefits and capitalizes
the income into an indication of present value. The principal of anticipation is
fundamental to the approach. Techniques and procedures from this approach are
used to analyze comparable sales data and to measure obsolescence in the Cost
Approach.
Each of the three approaches to value requires data collection from the market and each are
governed equally by the principle of substitution. This principle holds "when several similar
or commensurate commodities, goods or services are available, the one with the lowest price
will attract the greatest demand and widest distribution”. (Source: The Appraisal of Real
Estate – Thirteenth Edition by the Appraisal Institute)
Clark Real Estate Appraisal (14-006es) (01/30/2014) 84
COST APPROACH
The Cost Approach to value reflects the actions of market participants relative to cost. Older
properties may exhibit physical and/or functional deficiencies that affect value. For this reason,
the Cost Approach is most applicable to new or proposed construction. The Cost Approach i s often
the only credible approach when there are few sales and little income data available. It is also
useful as a check of reasonableness.
The first step in the Cost Approach is to estimate the value of the subject site as if vacant. The next
step is to estimate the cost new of the existing improvements. The third step is to determine
depreciation for the subject improvements and to subtract the depreciation from the cost new.
The final step is to add the site value to the improvement cost less dep reciation.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 85
LAND VALUE ESTIMATE
We searched the city of Bozeman market for sales of vacant sites suitable for residential and/or
community center use. We located 4 closed sales in the city of Bozeman that are considered
appropriate comparables for the subject site as if vacant. Due to the limited market data it was
necessary to use 1 land sale that sold more than 2 years ago. The unit of comparison used in thi s
analysis is the price per lot. This is the unit of comparison used by most market participa nts for
purchases of similar sites. The sales are described on the table below:
A complete description of each sale is included in the comparable land sale write -ups provided in
this section of this report. A map depicting the location of the subject and comparables is below.
Comp #Address Area Acres Size in SF Sales Price Sale Date Price/Acre
1 NHN Mathew Bird Circle Bozeman 0.332 14,462 $163,000 10/17/2013 $490,964
2 NHN Vaquero Parkway Bozeman 3.023 131,678 $400,000 9/19/2013 $132,319
3 NHN Fowler Avenue Bozeman 0.804 35,022 $189,000 5/9/2013 $235,075
4 2103 Lomas Drive Bozeman 0.570 24,829 $250,000 6/1/2011 $438,596
SUMMARY OF LAND COMPARABLES
FOR 2.147 ACRE ASSEMBLAGE AT 811 S WILLSON AVE, BOZEMAN, MT
Subject
Comp 3
Comp 2
Comp 1
Comp 4
Clark Real Estate Appraisal (14-006es) (01/30/2014) 86
LAND SALE 1
Location
City/State
County
Assessor Number(s)
Zoning
Size: Acres
Square Feet
Gross or Net
Date of Sale
Sale Price
Less Improvements
Adjusted Sale Price
SW MT MLS #
Price Per Acre $490,964 Price per Square Foot
Price per Lot $163,000 Price per Front Foot
Grantor Palmer Property Holdings, LLC Grantee
Recording Data Warranty Deed #2465973D Marketing Time 110
Financing/Conditions Cash Equivalent Verified By
Legal Description Lot 93 of West Meadow
Subdivision, Phase 3, City of
Bozeman, Gallatin County,
Montana
Intended Use
Section/Township/Range S19-T02S-R06E
Access Mathew Bird Circle Traffic Count
Topography Level Lot Dimensions
Flood Plain FEMA Map #30031C0818D Dated
09/02/2011, Zone X, Minimal Flood
Risk
Highest & Best Use at Sale
Shape Irregular Improvements
Frontage (Feet)N/A
View Similar Properties, Mountains Value of Improvements
Utilities Utilities to Lot: City Water &
Sewer, Nat. Gas, Telephone,
Electricity, Internet
Miscellaneous
Verified by SK Report File #
COMPARABLE SALE INFORMATION
Gross
October 17, 2013
$163,000
$11.27
N/A
Bozeman, MT
Gallatin
0.332
14,462
00RGG51601
R-1, Residential Single-
Household, Low Density
NHN Mathew Bird Circle
14-006es
Residential
Irregular
Residential Development
Not available
PROPERTY DETAILS
None
N/A
$0
TRANSFER INFORMATION
Days on Market
Daniel P. Wetstein and Kathleen
F. Wetstein
$163,000
Jim Appleby - 406-579-0839
Carol Lister - 406-581-9376
ANALYSIS OF SALE
191046
Clark Real Estate Appraisal (14-006es) (01/30/2014) 87
LAND SALE 2
Location
City/State
County
Assessor Number(s)
Zoning
Size: Acres (Rounded)
Square Feet
Gross or Net
Date of Sale
Sale Price
Less Improvements
Adjusted Sale Price
SW MT MLS #
Price Per Acre $132,319 Price per Square Foot
Price per Lot $400,000 Price per Front Foot
Grantor Holyoke V, Inc.Grantee
Recording Data Warranty Deed #2463205 Marketing Time 1207
Financing/Conditions Cash Verified By
Legal Description Lot 9 of Block 8, The Crossing at
Baxter Meadows, Gallatin County,
MT
Intended Use
Section/Township/Range S03-T02S-R05E
Access Vaquero Parkway Traffic Count
Topography Level Lot Dimensions
Flood Plain Not in Flood Plain Highest & Best Use at Sale
Shape Irregular Improvements
Frontage (Feet)331.5
View Similar Properties, Mountains Value of Improvements
Utilities Utilities to Lot: City Water &
Sewer, Nat. Gas, Telephone,
Electricity, Internet
Miscellaneous
Verified by SK Report File #
$0
TRANSFER INFORMATION
Shining Mountain Lutheran Church
$400,000
Jason Bayse, 406-581-7653 and
appraiser's files
ANALYSIS OF SALE
N/A
14-006es
Seller marketed to buyer as a
Community Center lot under
preliminary plat
Irregular
Residential Development
Not available
PROPERTY DETAILS
None
N/A
$3.04
$1,207
Bozeman, MT
Gallatin
3.023
131,678
00RGG65789
R3 - Residential Medium Density
COMPARABLE SALE INFORMATION
Gross
September 19, 2013
$400,000
Corner of Vaquero Parkway and
Davis Lane
Clark Real Estate Appraisal (14-006es) (01/30/2014) 88
LAND SALE 3
Location
City/State
County
Assessor Number(s)
Zoning
Size: Acres
Square Feet
Gross or Net
Date of Sale
Sale Price
Less Improvements
Adjusted Sale Price
SW MT MLS #
Price Per Acre $235,075 Price per Square Foot
Price per Lot $189,000 Price per Front Foot
Grantor Glacier Bank - REO Grantee
Recording Data Warranty Deed #2448884 Marketing Time 63
Financing/Conditions Cash Verified By
Legal Description Lot 19 in Block 1 of the Final Plat
of Fowler Place Subdivision, City of
Bozeman, Gallatin County,
Montana
Intended Use
Section/Township/Range S18-T02S-R06E
Access Christopher Way Traffic Count
Topography Level Lot Dimensions
Flood Plain FEMA Map #30031C0812D Dated
09/02/2011, Zone X, Minimal Flood
Risk
Highest & Best Use at Sale
Shape Irregular Improvements
Frontage (Feet)N/A
View Interior Views Value of Improvements
Utilities Utilities to Lot: City Water &
Sewer, Nat. Gas, Telephone,
Electricity, Internet
Miscellaneous
Verified by SK Report File #
COMPARABLE SALE INFORMATION
Gross
May 9, 2013
$189,000
$5.40
N/A
Bozeman, MT
Gallatin
0.804
35,022
000RGG7987
R-1, Residential Single-
Household, Low Density
NHN Fowler Avenue
14-006es
Residential Development, possible
multi-lot development
Irregular
Residential Development
Not available
PROPERTY DETAILS
None
N/A
$0
TRANSFER INFORMATION
Days on Market
Highfive Bozeman II LLC
$189,000
Mark Dobrenski - 406-599-2175
ANALYSIS OF SALE
187647
Clark Real Estate Appraisal (14-006es) (01/30/2014) 89
LAND SALE 4
Location
City/State
County
Assessor Number(s)
Zoning
Size: Acres
Square Feet
Gross or Net
Date of Sale
Sale Price
Less Improvements
Adjusted Sale Price
SW MT MLS #
Price Per Acre $438,596 Price per Square Foot
Price per Lot $250,000 Price per Front Foot
Grantor Robert B. Ogle a/k/a Robert E.
Ogle
Grantee
Recording Data Warranty Deed #2389769 Marketing Time 0
Financing/Conditions Cash Verified By
Legal Description Lot 23A of Graf's Second
Subdivision to the City of Bozeman,
Gallatin County, Montana
Intended Use
Section/Township/Range S18-T02S-R06E
Access Lomas Drive Traffic Count
Topography Slightly Sloped Lot Dimensions
Flood Plain FEMA Map #30031C0817D Dated
09/02/2011, Zone X, Minimal Flood
Risk
Highest & Best Use at Sale
Shape Irregular Improvements
Frontage (Feet)N/A
View Similar Properties, Mountains, City Value of Improvements
Utilities Utilities to Lot: City Water &
Sewer, Nat. Gas, Telephone,
Electricity, Internet
Miscellaneous
Verified by SK Report File #
$0
TRANSFER INFORMATION
Days on Market
Timothy Jon Horton and Laura
Nordlund Horton, Trustees of the
Timothy Jon Horton and Laura
Nordlund Horton Revocable Living
Trust dated February 16, 2010
$250,000
Penny Ogle - 406-595-7767
ANALYSIS OF SALE
176019
Originally platted as Lots 23 and
24, now amended as Lot 23A
14-006es
Residential
Irregular
Residential Development
Not available
PROPERTY DETAILS
None
COMPARABLE SALE INFORMATION
Gross
N/A
June 1, 2011
$250,000
$10.07
N/A
Bozeman, MT
Gallatin
0.570
24,829
000RGG3016
R-1, Residential Single-
Household, Low Density
2103 Lomas Drive
Clark Real Estate Appraisal (14-006es) (01/30/2014) 90
Comparison Sales Analysis Grid for Subject Site as if Vacant
Adjustments have been considered for differences between the comparable sales and the subject site.
Any adjustments made are noted on the spreadsheet below;
DESCRIPTION SUBJECT SALE 1 SALE 2 SALE 3 SALE 4
ADDRESS
811 S Willson
Ave
NHN Mathew Bird
Circle
NHN Vaquero
Parkway NHN Fowler Ave 2103 Lomas Drive
LOCATION Bozeman Bozeman Bozeman Bozeman Bozeman
SALES PRICE $163,000 $400,000 $189,000 $250,000
LISTING ADJUSTMENT
IMPROVEMENTS
BUYER EXPENDITURES
DEMOLITION
ENVIRONMENTAL
OTHER
LEGAL/ZONING
ADJUSTED PRICE $163,000 $400,000 $189,000 $250,000
PROPERTY RIGHTS Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple
PROPERTY RIGHTS ADJUSTMENT
ADJUSTED PRICE $163,000 $400,000 $189,000 $250,000
FINANCING Market Market Market Market Market
FINANCING ADJUSTMENT
ADJUSTED PRICE $163,000 $400,000 $189,000 $250,000
CONDITIONS OF SALE ADJUSTMENT Market Market Market REO Market
ADJUSTMENT $56,700
ADJUSTED PRICE $163,000 $400,000 $245,700 $250,000
DATE OF SALE 10/17/13 09/19/13 05/09/13 06/01/11
MARKET CONDITIONS FACTOR 1.00 1.00 1.00 1.00
ADJUSTED PRICE PER LOT $163,000 $400,000 $245,700 $250,000
APPROXIMATE SIZE IN ACRES 2.147 0.332 3.023 0.804 0.570
ADJUSTED SALES PRICE PER LOT $163,000 $400,000 $245,700 $250,000
RANKING BASED ON:
LOCATION Similar Similar Similar Similar
VIEW Similar Similar Similar Superior
SHAPE AND TOPOGRAPHY Similar Similar Similar Similar
ZONING Similar Similar Similar Similar
PARK AMENITY Inferior Similar Inferior Inferior
UTILITIES Similar Similar Similar Similar
SIZE Smaller Larger Smaller Smaller
ADJUSTED SALES PRICE PER LOT $163,000 $400,000 $245,700 $250,000
RANKING COMPARED TO SUBJECT Slightly Inferior
& Smaller
Similar
& Larger
Slightly Inferior
& Smaller Similar & Smaller
811 SOUTH WILLSON AVENUE, BOZEMAN, MONTANA
COMPARABLE SALES ANALYSIS
FOR 2.147 ACRES LOCATED AT
Clark Real Estate Appraisal (14-006es) (01/30/2014) 91
Discussion of Differences:
Buyer Expenditures, Property Rights, and Financing: According to our research no adjustment
was necessary in these categories for the comparable sales.
Conditions of Sale: Sale 3 is an REO sale. Research indicates that non-REO land sales of
comparable properties ranged from 4% to 137% more than REO land sales. These statistics
indicate a median of 48% more for non-REO land sales. We have made a conservative upward
adjustment of 30% to Sale 3 for this difference.
Market Conditions: All of the land sales closed in 2011 or 2013. Based upon our analysis, market
conditions for vacant residential parcels in Bozeman were similar on the effective date of this
report as on the closing dates of the comparables and no adjustment is necessary in this category.
Discussion of Rankings:
Location: We were unable to locate any recent vacant residential land sales within a historic district
in Bozeman. Therefore, there is not sufficient market data to determine the impact on vacant land
value for location within a historic district. The subject and all of the comparables are located in
the city limits of Bozeman and are considered similar.
View: Land Sale 4 is located on a lot overlooking the city. This is considered superior based on
view. The views from the subject and remaining comparables result in similar marketability.
Shape/Topography: The shapes and topographies of the subject and comparables result in similar
marketability.
Zoning: The subject is located in R-1, Residential Low Density zoning district with an additional
CUP that allows for use as a Community Center. All of the comparables are located in residential
zoning districts that allow for single family residential development. Sale 3 is located in an R-3,
Residential Medium Density zoning district and, based on a PUD subdivision plat, it was
designated as a Community Center lot. Based upon the highest and best use analysis of the subject
and comparables, zoning is similar.
Park Amenity: The subject includes a 1.1092 acre park along South Willson and College Avenue.
We located no sales that included a park amenity. All of the sales are within a mile of a park and
Land Sale 3 is adjacent to the Gallatin Regional Park . Based on its proximity to a park, Land Sale
3 is considered similar to the subject based on park a menity. The remaining Sales are not adjacent
to a park and they are considered inferior based on park amenity.
A map of the City of Bozeman Parks with the Subject and Comparable locations is provided on
the following page.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 92
Utilities: The subject and comparables all have similar access to necessary utilities.
Size: The subject is bracketed by the comparables based on lot size. B ased upon our analysis of
the available market data, the price per lot varies relative to total lot size. For this reason, size is
considered in the final reconciliation.
Reconciliation of Sales Comparison Approach for the Subject Site As If Vacant
The adjusted sales based on price per lot range from $163,000 to $400,000. Most weight is
accorded Sale 3, which is closest in size to the subject and is also designated as a Community
Center lot in the subdivision PUD. Secondary and equal weight is accorded the 3 remaining
Comparable Land Sales.
Based on this analysis, a price per lot of $350,000 is reasonable and supported by the data.
$350,000
Subject
Land Sale 2
Land Sale 4
Land Sale 3 Land Sale 1
Clark Real Estate Appraisal (14-006es) (01/30/2014) 93
COST ESTIMATE FOR IMPROVEMENTS
The next step in the Cost Approach is to estimate the cost new of the improvements , minus
depreciation, and add the estimated land value. The cost is based on an estimate derived from the
Marshall Valuation Service, a recognized national cost estimating service. The comparative -unit
method (utilizing the calculator method) is used to estimate the replacemen t cost for the subject
improvements. All applicable depreciation must be calculated and subtracted from the cost new.
It is important to note that our analysis is based upon replacement costs and not
reproduction costs.
We estimated the base cost for the subject main residence using the indicated cost for a High Value
Residence, Class ‘D’, Type V. We estimated the basement finished area separately from the
unfinished area. We considered the finished area as high value finish.
We estimated the base cost of the shell of the carriage house (considered an accessory building)
using a blended rate for a high value two story stable and a very good q uality guest house. These
two base costs were nearly the same. We estimated the cost of the interior finish o f the carriage
house based on the lowest cost interior office/apartment. We estimated the base cost for the 2nd
floor of the carriage house and the main floor storage area of the carriage house separately using
the indicated cost for a Class D, hayloft. In addition, when required, adjustments were made to
the indicated base cost for construction characteristics and current and local cost differences.
2nd & 3rd Floors: We applied a cost of $292.27 to the overall subject square footage above grade.
We have deducted the cost to renovate to bring the subject to a completed condition that would be
required for a single family residence . The cost to renovate the 2nd and 3rd floors was discussed in
the Highest and Best Use section of this report when the feasibility of a Bed and Breakfast was
analyzed. Based on the feasibility analysis we determined a reasonable cost estimate to renovate
the 2nd and 3rd floors and update the kitchen from prep to residential was $200 per square foot
applied to the square footage of the 2nd and 3rd floors. Based on the size of the 2nd and 3rd floors,
the cost of renovation would likely be $1,258,000 (6,290 square feet X $200/sf).
Depreciation:
Depreciation is defined as a loss in value of any kind. There are three categories of depreciation.
These are Physical Depreciation, Functional Depreciation and External (or Economic)
Depreciation.
The subject was constructed 1910. There is some physical depreciation present due to the age of
the subject and there is some functional obsolescence (in addition to the condition of the 2 nd and
3rd floors).
We estimated depreciation from all sources for each of the comparable sales used in the Sales
Comparison Approach of this report. There was not sufficient market data available to extract the
amount of each specific source of depreciation.
We verified each of the sales with the listing agent for the sale. We verified contributory site
values with listing agents. Improved Sale 3 contributory lot value was based on a recently sold
Clark Real Estate Appraisal (14-006es) (01/30/2014) 94
similar sized lot in the same historic neighborhood as Sale 3. That lot sold for $325,000 with an
improvement and the improvement was subsequently demolished. The overall market extracted
depreciation is presented below.
The indicated depreciation from all sources for the comparables ranges from 37% to 66%. We
have accorded approximately equal weight to all of the Improved Sales. We have selected an
overall depreciation rate of 50% for use in the Cost Approach for the subject property.
COST APPROACH CONCLUSION
The Cost Approach analysis for the subject property is presented on the following page.
Sale 1 Sale 2 Sale 3 Sale 4
502 S Grand 504 S Willson 1330 Gerald Ave 105 N Excelsior
Bozeman Bozeman Missoula Butte
Sale Price $1,800,000 $1,400,000 $1,125,000 $409,500
Less Value of Land -$300,000 -$325,000 -$325,000 -$40,950
Less Value of FF&E $0 $0 $0 $0
Depreciated Cost of Improvements $1,500,000 $1,075,000 $800,000 $368,550
Cost of Improvements As If New $2,390,000 $1,830,000 $1,730,000 $1,080,000
Less Depreciated Cost of Improvements -$1,500,000 -$1,075,000 -$800,000 -$368,550
Total Depreciation in Dollars $890,000 $755,000 $930,000 $711,450
Total Depreciation Percentage 37%41%54%66%
Year Constructed/Year Renovated 1904 / 1999 1886 / 2007 1918 / 2009 1898 / Unknown
Market Extracted Depreciation from All Sources from Improved Sales
Clark Real Estate Appraisal (14-006es) (01/30/2014) 95
BASE COST
MAIN RESIDENCE
HIGH VALUE RESIDENCE, SEC 12, PAGE 27
CLASS D, TYPE V $292.27
WALL HEIGHT MULTIPLIER, SEC 12, PAGE 24 1.000
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $300.51
HIGH VALUE RESIDENCE, SEC 12, PAGE 26
BASEMENT - CLASS D, HIGH VALUE FINISH $89.27
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $91.79
HIGH VALUE RESIDENCE, SEC 12, PAGE 26
BASEMENT - CLASS D, UNFINISHED/MECHANICAL $19.64
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $20.19
CARRIAGE HOUSE
CLASS D, SHELL OF ACCESSORY BUILDING CARRIAGE HOUSE
SEC 17, PAGE 36 & SEC 12, PAGE 29 - 40% FOR SHELL
CLASS D, VERY GOOD SHELL OF CARRIAGE HOUSE $51.20
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $52.64
CLASS D, INTERIOR OF CARRIAGE HOUSE - SEC 12, PAGE 13
CLASS D, LOWEST COST INTERIOR OFFICE-APARTMENT $47.29
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $48.62
CLASS D, HAYLOFT AREA, SEC 17, PAGE 30
CLASS D, HAYLOFT AREA $12.23
CURRENT COST MULTIPLIER, SEC 99, PAGE 3 1.060
LOCAL COST MULTIPLIER, SEC 99, PAGE 8 0.970
ADJUSTED BASE COST $12.57
COST ANALYSIS
811 SOUTH WILLSON AVENUE, BOZEMAN MONTANA
Clark Real Estate Appraisal (14-006es) (01/30/2014) 96
The indicated value for the subject property from the Cost Approach as rounded is
$1,530,000.
COST ANALYSIS
ABOVE GRADE RESIDENCE - EXCELLENT 9,594 @ $300.51 …………..$2,883,093
ADJUSTMENT FOR LOW COST INTERIOR OF 2ND & 3RD FLOORS OF RESIDENCE 6,290 @ -$200.00 …………..-$1,258,000
BASEMENT RESIDENCE - FINISHED 1,166 @ $91.79 …………..$107,027
BASEMENT RESIDENCE - UNFINISHED 2,209 @ $20.19 …………..$44,600
FIRE SUPRESSION SYSTEM - RESIDENCE Lump Sum ………………………….…………..$47,000
PORCHES, BALCONIES & PORTE COCHERE - RESIDENCE Lump Sum ………………………….…………..$60,000
ASSESSORY BUILDING - SHELL CARRIAGE HOUSE 4,680 @ $52.64 …………..$246,355
APARTMENT/OFFICE - CARRIAGE HOUSE 1,487 @ $48.62 …………..$72,298
2ND FLOOR HAYLOFT - CARRIAGE HOUSE 2,320 @ $12.57 …………..$29,162
ASSESSORY BUILDING - CARRIAGE HOUSE MAIN FLOOR STORAGE 873 @ $12.57 …………..$10,974
SITE IMPROVEMENTS & LANDSCAPING Lump Sum ………………………….…………..$50,000
COST NEW $2,292,509
ENTREPRENEURIAL INCENTIVE @ 10% $229,251
TOTAL COST NEW OF CURRENT IMPROVEMENTS $2,521,760
LESS OBSERVED DEPRECIATION
ESTIMATED TOTAL DEPRECIATION FROM ALL SOURCES 50.0%of adjusted cost $1,260,880
TOTAL DEPRECIATED IMPROVEMENT COST $1,260,880
ADD LAND VALUE $350,000
$1,610,880
LESS ADJUSTMENT FOR CONSERVATION EASEMENT ENCUMBRANCE -$80,544
INDICATED VALUE FROM COST APPROACH $1,530,336
ROUNDED TO $1,530,000
Clark Real Estate Appraisal (14-006es) (01/30/2014) 97
SALES COMPARISON APPROACH
The Sales Comparison Approach reflects the actions of market participants in purchasing historic
residences similar to the subject property as improved. We located only 2 sales in the immediate
subject market area. For this reason it was necessary to expand our search to other cities in
Montana. We located 4 sales and one active listing of historic residential properties that compare
relatively well with the subject property. These comparables are included on the table below;
The comparables are described in detail in this portion of this report. Photographs of the
comparables are included. A map indicating the locations of the comparables in relation to the
subject property is below.
Map of Improved Sales
Comp #Type Address Area
Sale/List
Price
Building
Size in SF Price/SF Sale Date
1 Residential 502 S Grand Ave Bozeman $1,800,000 5,411 $332.66 11/1/2013
2 Residential 504 S Willson Ave Bozeman $1,400,000 4,501 $311.04 7/10/2012
3 Residential 1330 Gerald Ave Missoula $1,125,000 4,128 $272.53 8/31/2012
4 Bed & Breakfast/ Boarding House 105 N Excelsior Ave Butte $409,500 7,812 $52.42 5/27/2009
A1 Bed & Breakfast 1003 2nd Ave NW Great Falls $445,000 5,653 $78.72 ACTIVE
SUMMARY OF COMPARABLE IMPROVED SALES
FOR 2.147 ACRES AS ASSEMBLED AT 811 S WILLSON AVE, BOZEMAN, MT
Subject
Comp 1
Comp 2
Comp 3
Listing 1
Comp 4
Clark Real Estate Appraisal (14-006es) (01/30/2014) 98
IMPROVED SALE 1
Location
City/State
County
Assessor Number
Zoning
Historic Significance
Conservation Easement
Site Size: Acres
Square Feet
Building SF Above Grade
Date of Sale
Sales Price
MLS #
Grantor Thomas E. Bitnar and Randle
Robinson Bitnar
Grantee
Recording Data Warranty Deed #2467200D Marketing Time 244
Financing/Conditions Cash Verified By
Legal Description North 20 ft of Lot 18 and Lots 19-20 in
Block 5 of Fairview Addition to
Bozeman, Gallatin County, Montana
Intended Use
Section/Township/Range S07-T02S-R06E
Building SF Above Grade 5,411 5,411
Basement Area 1,935 (Finished)Sales Price $1,800,000
# of Bedrooms 4 Less Site Value* $200,000
# of Bathrooms 4.5 Value of Improvements $1,600,000
Construction Wood Framed, Exterior Brick Sales Price Per Square Foot $332.66
Quality Excellent Price of Improvements Per SF $295.69
Condition Excellent
Year Built/Age 1904 / 109 Years / Renovated 1999
Number of Levels 3 + Basement
Functional Plan/Layout Yes
HVAC/Heating/Cooling Gas Radiant Hot Water
Outbuildings None
Garage Carport
Access City Street
Appliances Average
Utilities Electricity, Telephone, Natural Gas,
Internet, City Water & Sewer
Site Topography Level
Water Frontage None
Seller Concession $2,200 (Radon Mitigation)
Miscellaneous List Price: $1,850,000
* Estimated by Appraiser 14-006es
Notes
COMPARABLE SALE INFORMATION
CRMX-188 LLC
Mike Basile - 406-579-6530
Bozeman MT
November 1, 2013
$1,800,000
Improvement Size - SF
Report File
10,803
Gallatin
502 S Grand Ave
DESCRIPTION OF IMPROVEMENTS ANALYSIS OF SALE
Days on Market
187957
000RGH4670
5,411
R-1, Residential Single-Household, Low
Density
Residential
0.248
Listed on State and National Register of
Historic Places via Bon Ton Historic District
None
TRANSFER INFORMATION
Clark Real Estate Appraisal (14-006es) (01/30/2014) 99
502 South Grand Avenue
ADDITIONAL PHOTOGRAPHS
Foyer Living Room / Dining Room
Bedroom Bathroom
Scrollwork Patio
Clark Real Estate Appraisal (14-006es) (01/30/2014) 100
IMPROVED SALE 2
Location
City/State
County
Assessor Number
Zoning
Historic Significance
Conservation Easement
Site Size: Acres
Square Feet
Building SF Above Grade
Date of Sale
Sales Price
MLS #
Grantor David Ronsen and Michelle C
Ronsen
Grantee
Recording Data Warranty Deed #2420550D Marketing Time 532
Financing/Conditions Cash Verified By
Legal Description Lots 16, 17, 18, 19 and 20 in Block 6
of the Fairview Addition to the City of
Bozeman, Gallatin County, Montana
Intended Use
Section/Township/Range S07-T02S-R06E
Building SF Above Grade 4,501 4,501
Basement Area 1,293 (Unfinished)Sales Price $1,400,000
# of Bedrooms 4 Less Site Value* $275,000
# of Bathrooms 3.5 Value of Improvements $1,125,000
Construction Wood Framed Sales Price Per Square Foot $311.04
Quality Excellent Price of Improvements Per SF $249.94
Condition Excellent
Year Built/Age 1886 / 126 Years / Remodeled
2007
Number of Levels 3 + Basement
Functional Plan/Layout Yes
HVAC/Heating/Cooling Gas Radiant Hot Water
Outbuildings None
Garage 2-Car Detached
Access City Street
Appliances Excellent
Utilities Electricity, Telephone, Natural Gas,
Internet, City Water & Sewer
Site Topography Level
Water Frontage None
Seller Concession $9,450 (Fireplace Repair)
Miscellaneous List Price: $1,650,000
COMPARABLE SALE INFORMATION
Amy L. Andrews, Trustee of the
Christopher J. Andrews and Amy L.
Andrews Revocable Living Trust,
Dated May 4, 2009
Denise Andres - 406-556-5065
Bozeman MT
July 10, 2012
$1,400,000
Improvement Size - SF
24,002
Gallatin
504 S Willson
Notes
000RGH5314
4,501
R-1, Residential Single-Household,
Low Density, Bon Ton Historic District
Residential
0.551
Listed on State and National Register
of Historic via Bon Ton Historic District
None
TRANSFER INFORMATION
DESCRIPTION OF IMPROVEMENTS ANALYSIS OF SALE
Days on Market
172149
Clark Real Estate Appraisal (14-006es) (01/30/2014) 101
504 South Willson
ADDITIONAL PHOTOGRAPHS
Living Room Dining Room
Kitchen Bedroom
Bathroom Den
Clark Real Estate Appraisal (14-006es) (01/30/2014) 102
IMPROVED SALE 3
Location
City/State
County
Assessor Number
Zoning
Historic Significance
Conservation Easement
Site Size: Acres
Square Feet
Building SF Above Grade
Date of Sale
Sales Price
MLS #
Grantor Terry G. Whatley and Margery M.
Whatley
Grantee
Recording Data Warranty Deed #201217029 Marketing Time 103
Financing/Conditions Cash Verified By
Legal Description Lot 4 in Block 26 in Hammond
Addition No. 3 to the City of Missoula,
Missoula County, Montana
Intended Use
Section/Township/Range S27-T13N-R19W
Building SF Above Grade 4,128 4,128
Basement Area 2,244 (Unfinished)Sales Price $1,125,000
# of Bedrooms 5 Less Site Value* $325,000
# of Bathrooms 2.5 Value of Improvements $800,000
Construction Wood Framed, Masonry/Brick
Exterior
Sales Price Per Square Foot $272.53
Quality Excellent Price of Improvements Per SF $193.80
Condition Excellent
Year Built/Age 1918 / 94 Years / Renovated 2009
Number of Levels 2 + Basement (Unfinished) + Attic
(Unfinished)
Functional Plan/Layout Yes
HVAC/Heating/Cooling Gas Radiant Hot Water
Outbuildings None
Garage 2-Car Detached
Access City Street
Appliances Excellent
Utilities Electricity, Telephone, Natural Gas,
Internet, City Water & Sewer
Site Topography Level
Seller Concession None
Water Frontage None
Miscellaneous List Price: $1,280,000
* Estimated by Appraiser 14-006es
1330 Gerald Ave
DESCRIPTION OF IMPROVEMENTS ANALYSIS OF SALE
Days on Market
20123416
0001336600
4,128
R5.4, Residential (1 Detached
Dwelling per 5,400 sf)
Residential
0.53
Listed on State and National Register
of Historic Places via the University
Historic District
None
TRANSFER INFORMATION
Notes
COMPARABLE SALE INFORMATION
Anne E. Timmons
Jeremy Williams - 406-532-7919
Missoula MT
August 31, 2012
$1,125,000
Improvement Size - SF
Report File
23,087
Missoula
Clark Real Estate Appraisal (14-006es) (01/30/2014) 103
1330 Gerald Avenue
ADDITIONAL PHOTOGRAPHS
Foyer Dining Room
Kitchen Living Room
Bathroom Stairway
Clark Real Estate Appraisal (14-006es) (01/30/2014) 104
IMPROVED SALE 4
Location
City/State
County
Assessor Number
Zoning
Historic Significance
Conservation Easement
Site Size: Acres
Square Feet
Building SF Above Grade
Date of Sale
Sales Price
MLS #
Grantor Chad L. Tipton and Shannon Tipton Grantee
Recording Data Warranty Deed #629769 Marketing Time 485
Financing/Conditions Conventional Verified By
Legal Description Lot 1 and East 40 feet of Lot 2 in
Block 3 of Excelsior Addition to
City and County of Butte Silver
Bow, Montana
Intended Use
Section/Township/Range S14-T03N-R08W
Building SF Above Grade 7,812 7,812
Basement Area 3,255 (Unfinished)Sales Price $409,500
# of Bedrooms 9 Less Site Value* $40,950
# of Bathrooms 7.5 Value of Improvements $368,550
Construction Wood Framed, Exterior Brick Sales Price Per Square Foot $52.42
Quality Excellent Price of Improvements Per SF $47.18
Condition Good
Year Built/Age 1898 / 111 Years
Number of Levels 3 + Basement
Functional Plan/Layout Yes
HVAC/Heating/Cooling Gas Radiant Hot Water
Outbuildings None
Garage None
Access City Street
Appliances Excellent / Historic
Utilities Electricity, Telephone, Natural Gas,
Internet, City Water & Sewer
Site Topography Level
Seller Concession None
Water Frontage None
Miscellaneous List Price: $449,000
* Estimated by Appraiser 14-006es
105 N Excelsior Ave
DESCRIPTION OF IMPROVEMENTS ANALYSIS OF SALE
Days on Market
90538
0001430410
7,812
R-3, Multi-Family Residential
Bed & Breakfast / Boarding House
0.23
Listed on State and National Register of
Historic Places via the Butte-Anaconda
National Historic Landmark district
None
TRANSFER INFORMATION
Notes
COMPARABLE SALE INFORMATION
MJG Properties, LLC
Sheri Broudy - 406-490-4069
Butte MT
May 27, 2009
$409,500
Improvement Size - SF
Report File
10,019
Silver Bow
Clark Real Estate Appraisal (14-006es) (01/30/2014) 105
105 N Excelsior Ave
ADDITIONAL PHOTOGRAPHS
Front Entry Living Room
Kitchen Kitchen
Bathroom Stairway
Clark Real Estate Appraisal (14-006es) (01/30/2014) 106
IMPROVED LISTING 1
Location
City/State
County
Assessor Number
Zoning
Historic Significance
Conservation Easement
Site Size: Acres
Square Feet
Build SF Above Grade
Date of Sale
Asking Price
MLS #
Grantor (Current Owner)Samuel J., Sr. and Andrea L.
Gouchenour
Grantee
Recording Data N/A Marketing Time (as of report
effective date)
50
Financing/Conditions N/A Verified By
Legal Description Lots 12, 13 and 14 of Block 28 of the
West Great Falls Addition to the City
of Great Falls, Cascade County,
Montana
Intended Use
Section/Township/Range S03-T20N-R03E
Building SF Above Grade 5,653 5,653
Basement Area 2347 (Unfinished)Asking Price $445,000
# of Bedrooms 8 Less Site Value* $60,000
# of Bathrooms 7 Furniture, Fixtures and Equipment*$50,000
Construction Wood Framed, Exterior Masonry Value of Improvements $335,000
Quality Excellent Sales Price Per Square Foot $78.72
Condition Very Good Price of Improvements Per SF $59.26
Year Built/Age 1891 / 123 Years / Renovated 2009
Number of Levels 3 + Basement
Functional Plan/Layout Yes
HVAC/Heating/Cooling Gas Radiant Hot Water
Outbuildings None
Garage None
Access City Street
Appliances Average
Utilities Electricity, Telephone, Natural Gas,
Internet, City Water & Sewer
Site Topography Level
Water Frontage None
Seller Concession None
Miscellaneous Prior Sale 6/5/2008, $305,000
* Estimated by Appraiser 14-006es
Notes: Currently operated as Bed and Breakfast; 5 rooms with nightly rates $89 to $135.
0001828100
5,653
R-3, Residential Single-Household, High
Density
Bed and Breakfast
0.502
Listed on State and National Register of
Historic Places, National Register
Reference #80002402
None
TRANSFER INFORMATION
DESCRIPTION OF IMPROVEMENTS ANALYSIS OF SALE
Days on Market
13-2496
COMPARABLE SALE INFORMATION
N/A
Kerry McInerney - 406-868-4324
Great Falls MT
Active
$445,000
Improvement Size - SF
Report File
21,867
Cascade
1003 2nd Avenue NW
Clark Real Estate Appraisal (14-006es) (01/30/2014) 107
1003 2nd Ave Northwest
ADDITIONAL PHOTOGRAPHS
Foyer Living Room
Dining Room Kitchen
Bedroom Bathroom
Clark Real Estate Appraisal (14-006es) (01/30/2014) 108
SALES COMPARISON ANALYSIS
A sales comparison analysis for the subject property utilizing the comparables presented is below.
The sales comparison addresses the subject residence finished area. Separate adjustments will be
made to account for the carriage house, the conse rvation easement and the unfinished area above
grade in the main residence.
DESCRIPTION SUBJECT SALE 1 SALE 2 SALE 3 SALE 4 LISTING 1
IDENTIFICATION 811 N Willson 502 S Grand 504 S Willson 1330 Gerald
105 N
Excelsior
1003 2nd Ave
NW
LOCATION Bozeman Bozeman Bozeman Missoula Butte Great Falls
SALE OR LIST PRICE $1,800,000 $1,400,000 $1,125,000 $409,500 $445,000
ADJUSTMENT FOR FF&E -$50,000
ADJUSTED PRICE $1,800,000 $1,400,000 $1,125,000 $409,500 $395,000
LISTING ADJUSTMENT -$39,500
SELLER CONCESSIONS -$2,200 -$9,450
BUYER EXPENDITURES
DEMOLITION
ENVIRONMENTAL
OTHER
LEGAL/ZONING
ADJUSTED PRICE $1,797,800 $1,390,550 $1,125,000 $409,500 $355,500
PROPERTY RIGHTS Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple Fee Simple
PROPERTY RIGHTS ADJUSTMENT
ADJUSTED PRICE $1,797,800 $1,390,550 $1,125,000 $409,500 $355,500
FINANCING Market Market Market Market Market Market
FINANCING ADJUSTMENT
ADJUSTED PRICE $1,797,800 $1,390,550 $1,125,000 $409,500 $355,500
CONDITIONS OF SALE Market Market Market Market Market Market
CONDITIONS OF SALE ADJUSTMENT
ADJUSTED PRICE OF IMPROVEMENTS $1,797,800 $1,390,550 $1,125,000 $409,500 $355,500
DATE OF SALE 11/01/13 07/10/12 08/31/12 05/27/09 ACTIVE
MARKET CONDITIONS FACTOR 1.00 1.09 1.08 1.00 1.00
ADJUSTED PRICE $1,797,800 $1,515,700 $1,215,000 $409,500 $355,500
FINISHED AREA ABOVE GRADE 3,304 5,411 4,501 4,128 7,812 5,653
ADJUSTMENT FOR:
LOCATION/SITE $150,000 $75,000 $25,000 $309,000 $290,000
FINISHED SQUARE FOOTAGE ABOVE GRADE ($158,000)($90,000)($62,000)($338,000)($176,000)
BASEMENT FINISHED SQUARE FOOTAGE ($38,000)$58,000 $58,000 $58,000 $58,000
ADJUSTED PRICE $1,751,800 $1,558,700 $1,236,000 $438,500 $527,500
ADJUSTED SALES PRICE PER SQUARE FOOT $324 $346 $299 $56 $93
RANKINGS FOR:
QUALITY Excellent Similar Similar Similar Similar Similar
CONDITION/AGE Excellent Similar Similar Similar Inferior Inferior
OVERALL RANKING COMPARED TO SUBJECT Similar Similar Similar Inferior Inferior
ADJUSTED PRICE PER SQUARE FOOT $324 $346 $299 $56 $93
AS OF JANUARY 30, 2014
AT 811 SOUTH WILLSON AVE, BOZEMAN, MONTANA
SALES COMPARISON ANALYSIS GRID FOR A HISTORIC PROPERTY
Clark Real Estate Appraisal (14-006es) (01/30/2014) 109
Discussion of Adjustments:
Furniture, Fixtures & Equipment: According to the listing agent, Active Listing 1, a bed and
breakfast, includes FF&E with an estimated value of $50,000. A downward adjustment in this
amount was made to Active Listing 1 to account for this .
Listing Adjustment: Based on market data, sale prices are typically less than list prices. The
percentage of Sale to List for the Improved Sales 1, 2, 3 and 4 range from 84.7% to 97.3% and
average 90.3%. Based on this market evidence, Active Listing 1 was adjusted downward by 10%
to account for the high likelihood that it will not sell for full list price.
Seller Concessions: Sales 1 and 2 required downward adjustments for Seller Concessions. Sale 1
was adjusted downward by $2,200 for radon mitigation and Sale 2 was adjusted downward by
$9,450 for fireplace repairs.
Buyer Expenditures, Property Rights, Financing and Conditions of Sale: No adjustments were
considered necessary in these categories for the comparables.
Market Conditions: Improved Sales closed from 2009 through 2013 in Bozeman, Missoula and
Butte markets. Sale 1 closed in Bozeman in the past 6 months and no market adjustment was
considered necessary. Sale 2 closed in Bozeman in 2012. Based on changes in market conditions
in Bozeman, an upward adjustment of 9% was required for Sale 2. Sale 3 closed in 2012 in
Missoula. Based on changes in market conditions in Missoula since 2012, an upward adjustment
of 8% was required for Sale 3. Sale 4 closed in 2009 i n Butte. The median price of single family
home sales in Butte has been relatively stable since 2009 and no adjustment was necessary to Sale
4 for changes in market conditions.
Location/Site: The adjustments in this category reflect the differences between the contributory
land values of the comparables and the subject site value as if vacant. This adjustment takes into
consideration all differences in the site and location. The table below indicates the adjustment
made for differences in location and site to each of the comparables and the active listing.
Finished Square Footage Above-Grade: The comparables vary in size compared to the subject.
Based on the differences in size, an adjustment of $75 per square foot was made to each of the
Comparables to reflect this difference. The table presented on the following page indicates the
adjustment made to each of the comparables and the active listing for differences in finished square
footage above grade.
Subject
(As Assembled)Sale 1 Sale 2 Sale 3 Sale 4 Active 1
Size 2.147 0.248 0.551 0.530 0.230 0.502
Subject Land Value $350,000 $350,000 $350,000 $350,000 $350,000 $350,000
Est. Land Value of Comp $200,000 $275,000 $325,000 $40,950 $60,000
Adjustment $150,000 $75,000 $25,000 $309,050 $290,000
Adjustment Rounded $150,000 $75,000 $25,000 $309,000 $290,000
Site Value Adjustment
Clark Real Estate Appraisal (14-006es) (01/30/2014) 110
Basement Finished Square Footage: The comparables all include basements; however, only the
subject and Sale 1 include a finished basement area. An adjustment of $50 per square foot was
applied to the difference between the subject finished square footage and each of the comparables
to account for differences in size of finished basement. The table below indicates the adjustments
made.
Discussion of Rankings:
Quality: The subject and comparables are all historic homes with turn of the century architecture.
The subject and comparables are considered similar based on quality.
Condition/Age: Age and condition are typically interrelated and the overall condition is reflective
of the effective age. The overall condition of Improved Sale s 1, 2, 3 are considered similar to the
subject. Sale 4 and Active Listing 1 are considered inferior to the subject based on condition.
SALES COMPARISON APPROACH RECONCILIATION
The closed sales provided indications of $324, $346, $299 and $56 per square foot respectively.
Sales 1 and 2 are located in the same historic district as the subject. Sale 3 is located in the
University Historic District in Missoula. All are considered of similar quality and condition.
Approximately equal weight is accorded Sales 1, 2 and 3. No weight is accorded Sale 4 and Active
Listing 1 as they are considered inferior to the subject based on condition. Also, based upon our
analysis of the contributory site values for Sale 4 and Active Listing1 they are likely located in
areas that exhibit external obsolescence.
We have accorded approximately equal weight to Sales 1, 2 and 3, indicating a price of $325 per
square foot for the subject property (rounded). This is reasonable and well supported by the
available market data. Based on this, the value indicated for the finished areas of the subject
residence is $1,073,800(3,304 SF X $325/SF).
Contributory Value of 2nd & 3rd Floor Shell: In addition to the main floor and basement finished
areas of the main residence , the exterior shell of the 2 nd and 3rd floors of the main house must be
considered. This estimate is based on the depreciated cost analysis from the Cost Approach. A
table detailing this adjustment is on the following page.
Subject Sale 1 Sale 2 Sale 3 Sale 4 Active 1
Finished Square Footage Above Grade 3,304 5,411 4,501 4,128 7,812 5,653
Difference in Subject & Comparables in SF Comp SF - Subject SF 2,107 1,197 824 4,508 2,349
Adjustment ($158,025)($89,775)($61,800)($338,100)($176,175)
Rounded ($158,000)($90,000)($62,000)($338,000)($176,000)
Above Grade Finished Square Footage Adjustment
Subject Sale 1 Sale 2 Sale 3 Sale 4 Active 1
Basement Finished Square Footage 1,166 1,935 0 0 0 0
Difference in Subject & Comparables in SF Comp SF - Subject SF 769 (1,166) (1,166) (1,166) (1,166)
Adjustment ($38,450)$58,300 $58,300 $58,300 $58,300
Rounded ($38,000)$58,000 $58,000 $58,000 $58,000
Basement Finished Square Footage Adjustment
Clark Real Estate Appraisal (14-006es) (01/30/2014) 111
Based on an estimated cost of $55 per square, $345,950 is an appropriate adjustment for the 2nd
and 3rd floor exterior shell of the main residence.
Contributory Value of Carriage House: In addition to the 2nd and 3rd floor exterior shell
adjustment, we also must consider a contributory value for the carriage h ouse. We have relied
upon the depreciated cost as estimated in the Cost Approach for this adjustment . We have
determined this to be $200,000 as presented in the table below.
Diminution in Value for Conservation Easement : Last, we must also consider the diminution
in value due to the Conservation Easement. This was discussed in the Market Analysis section of
this report and was determined to be 5%.
Conclusion: Based on this analysis, the indication of the value of the encumbered fee simple
interest in the subject property from the Sales Comparison Approach is below;
3,304 SF X $325/SF $1,073.800
Exterior Shell of 2nd & 3rd Floor $ 345,950
Carriage House $ 200,000
$1,619,750
Less 5% for Conservation Easement $ 80,988
Value Indicated $1,538,762
Rounded To $1,540,000
Cost New/SF $300.51
Less Cost to Finish Interior $200.00
Exterior Cost $100.51
Plus Entreprenuerial Incentive $10.05
Cost New Exterior $110.56
Less Depreciation @ 50%$55.28
Rounded $55.00
SF of Exterior 2nd & 3rd Floors 6,290
Total for Exterior 2nd & 3rd Floors $345,950
2nd & 3rd Floor Shell Exterior Adjustment
SHELL OF CARRIAGE HOUSE 4,680 @ $52.64 $246,355
APARTMENT/OFFICE - CARRIAGE HOUSE 1,487 @ $48.62 $72,298
2ND FLOOR HAYLOFT - CARRIAGE HOUSE 2,320 @ $12.57 $29,162
CARRIAGE HOUSE MAIN FLOOR STORAGE 873 @ $12.57 $10,974
$358,789
ENTREPRENURIAL INCENTIVE @ 10%$35,879
$394,668
DEPRECIATION @ 50%$197,334
$197,334
$200,000
Contributory Value of Carriage House
As Rounded
Clark Real Estate Appraisal (14-006es) (01/30/2014) 112
RECONCILIATION OF VALUE INDICATIONS
The value indications for the Encumbered Fee Simple Interest in the subject property are indicated
below;
Cost Approach
The Cost Approach is typically most applicable for proposed, new or relatively new properties.
This approach can also provide some insight into value when there are few sales or lease
comparables available. The Cost Approach can also be used as a check of reasonableness, which
is how we have relied upon it in this report.
Sales Comparison Approach
The Sales Comparison Approach was developed using the best comparables available in the
greater subject market area. In this case we considered sales of historic mansions in urban areas
throughout the state. The sales provide indications of the actions of market participants relative to
purchases of similar properties in the immediate and greater subject market area. The comparables
provide credible information regarding the actions of market participants with regar d to historic
residential properties. Quantitative and qualitative adjustments were necessary for differences
between the subject and comparables. The adjustments were considered necessary and appropriate .
This approach is accorded all weight.
Income Approach
The subject property in as is condition was not considered an income producing property since the
net revenue for the current use was less than zero. The Income Approach was not applicable to the
valuation of the subject property. Omitting this approach does not impact the credibility o f this
report.
Conclusion
All weight is placed on the Sales Comparison. The Cost Approach provides a check of
reasonableness. After careful consideration, the encumbered fee simple interest in the subject
property, in as is condition, as of January 30, 2014 is:
$1,540,000
Encumbered Fee Simple
Interest
Cost Approach $1,530,000
Sales Comparison Approach $1,540,000
Income Capitalization Approach Not Developed
Clark Real Estate Appraisal (14-006es) (01/30/2014) 113
QUALIFICATIONS OF THE APPRAISER
ELLIOTT (ELLIE) M. CLARK, MAI
PROFESSIONAL DESIGNATIONS
MAI Designated Member of the Appraisal Institute (2004)
FORMAL EDUCATION
College of Charleston, Charleston, SC
Bachelor of Science – Geology (1985)
REAL ESTATE EDUCATION
Appraisal Institute
1990 - Basic Valuation Procedures
1990 - Real Estate Principles
1992 - Capitalization Theory and Technique
1994 - Advanced Income Capitalization
2001 - Highest and Best Use and Market Analysis
2001 - Advanced Sales Comparison and Cost Approaches
2002 - Standards of Professional Practice, Part A
2002 - Standards of Professional Practice, Part B
2002 - Report Writing and Valuation Analysis
2002 - Advanced Applications
2003 - Comprehensive Exam
2003 - Separating Real & Personal Property from Intangible Business Assets
2004 - Demonstration Appraisal
2006 - 7 Hour National USPAP Update Course
2006 - Business Practices and Ethics
2008 - 7 Hour National USPAP Update Course
2010 - 7 Hour National USPAP Update Course
2012 – 7 Hour National USPAP Update Course
2012 – Fundamentals of Separating Real Property, Personal Property and Intangible Business Assets
2012 – Valuation of Conservation Easements
2014 – 7 Hour National USPAP Update Course
Institute of Financial Education
1985 - Real Estate Law I
1986 - Real Estate Law II
IAAO
1991 - Standards of Practice and Professional Ethics
Citadel Evening College
1993 - Residential Appraisal Reports Using URAR Form
William H. Sharp & Associates
1995 - The Home Inspection
Trident Technical College
Clark Real Estate Appraisal (14-006es) (01/30/2014) 114
1997 - Uniform Standards of Appraisal
Historic Preservation Consulting
1998 - Appraising Historic Property
The Beckman Company
2004 - The Technical Inspection of Real Estate
WORK EXPERIENCE
2003 - Present Clark Real Estate Appraisal – Owner/Commercial Real Estate Appraiser
1995 - 2003 Sass, Herrin & Associates, Inc. – Commercial Real Estate Appraiser
1990 - 1995 Charleston County Assessor’s Office – Sr. Staff Real Estate Appraiser
1986 - 1989 First Sun Capital Corporation - Mortgage Loan Officer
1985 - 1986 First National Bank of Atlanta - Mortgage Loan Processor
1984 - 1985 South Carolina Federal Savings Bank - Mortgage Loan Processor
STATE LICENSES/CERTIFICATIONS
Montana State Certified General Real Estate Appraiser - REA-RAG-LIC-683
APPRAISAL SEMINARS ATTENDED
2000 – JT&T Seminars: Financial Calculator HP -12C
2000 – Appraisal Institute: Highest and Best Use Applications
2004 – Appraisal Institute: Evaluating Commercial Construction
2005 – Appraisal Institute: Scope of Work: Expanding Your Range of Services
2006 – Appraisal Institute: Subdivision Valuation
2006 – Appraisal Institute: Appraising from Blueprints and Specifications
2006 – Appraisal Institute: Uniform Appraisal Standards for Federal Land Acquisitions
2007 – Appraisal Institute: Analyzing Commercial Lease Clauses
2007 – Appraisal Institute: Condominiums, Co-ops, and PUDs
2008 – Appraisal Institute: Spotlight on USPAP
2008 – Appraisal Institute: Quality Assurance in Residential Appraisals: Risky Appraisals = Risky Loans
2008 – Appraisal Institute: Office Building Valuation: A Contemporary Perspective
2009 – Appraisal Institute: Appraisal Curriculum Overview (2-Day General)
2010 – Appraisal Institute: Hotel Appraising – New Techniques for Today’s Uncertain Times
2010 – Appraisal Institute: The Discounted Cash Flow Model: Concepts, Issues & Applications
2011 – Appraisal Institute: Understanding & Using Investor Surveys Effectively
2011 – Appraisal Institute: Advanced Spreadsheet Modeling for Valuation Applications
2012 – Appraisal Institute: Appraising the Appraisal: Appraisal Review -General
2013 – Appraisal Institute: Business Practices and Ethics
PARTIAL LIST OF CLIENTS
Glacier Bank
Rocky Mountain Bank
State of Montana Department of Natural Resources
Montana Department of Transportation
United Stated Department of Interior
Clark Real Estate Appraisal (14-006es) (01/30/2014) 115
SANDRA S. KENNEDY
FORMAL EDUCATION
University of Montana at Western, Dillon, MT
Bachelor of Science in Business, Magna cum Laude
REAL ESTATE EDUCATION
Appraisal Institute
Course 110 – Appraisal Principles, 2004
Course 120 – Appraisal Procedures, 2004
Course 410 – 15- Hour National USPAP Course, 2004
Course 203R- Residential Report Writing & Case Studies, 2006
Course - National Uniform Standards of Professional Appraisal Practice Update V.06, 2006
Course 320 – Basic Income Capitalization, 2006
Course 540 – Report Writing and Valuation, 2007
Course 510 – Advanced Income Capitalization, 2007
Course - National Uniform Standards of Professional Appraisal Practice Update, 2008
Course N400G - General Appraiser Market Analysis and Highest and Best Use, 2009
Course 420 – Online Business Practices & Ethics-2009
Course - National Uniform Standards of Professional Appraisal Practice Update, 2010
Course 503GD-Advanced Concepts & Case Studies, 2011
Course - National Uniform Standards of Professional Appraisal Practice Update, 2012
Course – Comprehensive Review of Appraisal Concepts, 2013
Comprehensive Exams Passed: Modules I, II, III and IV, 2013
Course - National Uniform Standards of Professional Appraisal Practice Update, 2014
SEMINARS & WEBINARS
2004 – Webinar: Appraising the Appraisal
2005 – Seminar: The Professional’s Guide to the Uniform Re sidential Appraisal Report
2008 – Seminar: Spotlight on USPAP: Hypothetical Conditions and Extraordinary Assumptions
2010 – ABA/AI Telephone Briefing, Appraisal Review: Sales Comparison Approach
2010 – ABA/AI Telephone Briefing, Appraisal Review: Income Capitalization Approach
2011 – Seminar: The Uniform Appraisal Dataset from Fannie Mae and Freddie Mac
2011 – Webinar: Understanding the Interagency Appraisal and Evaluation Guidelines
2011 – ABA/AI Telephone Briefing: 1004MC Form: Issues and Solutions
2012 – Seminar: Appraising the Appraisal: Appraisal Review- General
2013 – Montana Economic Outlook Seminar
2013 – Seminar 112: Practical Regression Using Microsoft Excel
WORK EXPERIENCE
2008-Present Clark Real Estate Appraisal, Inc. – Montana Certified General Appraiser
2004 – 2008 Clark Real Estate Appraisal, Inc. – Real Estate Appraiser Trainee
2003 – 2004 General Contractor for personal residence
2002 – 2004 Carroll College – Director of Planned Giving
1994 – 2002 Carroll College – Director of Development
1990 – 1992 Western Washington University – Director of Annual Giving
1987 – 1990 University of Montana at Western – Alumni & Development Program Coordinator
STATE LICENSES/CERTIFICATIONS
Montana Certified General Real Estate Appraiser REA-RAG-LIC-758
Clark Real Estate Appraisal (14-006es) (01/30/2014) 116
APPRAISERS LICENSES
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ADDENDUM
Clark Real Estate Appraisal (14-006es) (01/30/2014) 118
NATIONAL ECONOMIC DATA
Real GDP increased 3.2% in the fourth quarter of 2013 after increasing 4.1% in the third quarter
of 2013 based to the estimate released by the Bureau of Economic Analysis of the US Department
of Commerce (BEA). According to
the BEA, the slowdown in real GDP
growth mainly reflected a slowdown
in inventory investment. A decrease
in federal government spending was
also cited as a factor. The full effects
of the federal government shutdown
in October could not be quantified;
however, BEA estimated that the
effects of the reduction in hours
worked by federal employees
reduced GDP growth by 0.3%.
Accelerating net exports and
increases in consumer spending
served as offsetting factors to the downturn in GDP growth for the fourth quarter of 2013. Overall
the national economy appears to be slowly improving.
STATE ECONOMIC DATA
Montana is the 44th most populous state in the US. 2010 US Census data estimated a population
of 989,415 indicating a growth in population of 9.7% from 2000 to 2010. The US Census Bureau
estimates that the population of Montana in 2013 was 1,005,292. This estimate shows a 1.6%
increase since the last census in 2010. The state economy is diverse with a wide variety of
industries. The top five employment categories in the state are;
Trade, Transportation, and Utilities
Government (Federal, State, & Local)
Education & Health Services
Healthcare & Social Assistance
Leisure & Hospitality
These industries employ from 11% to 16% of the workforce in Montana per category. The
remaining categories employ less than 10% each.
According the University of Montana Bureau of Economic Re search estimates, the state economy
grew by about 2.7 percent, as measured by inflation-adjusted nonfarm earnings, in 2013. The long
term outlook for Montana is for continued growth as economic activity accelerates in most areas
of the state.
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GALLATIN COUNTY DATA
The subject property is located in Gallatin County which is in the southwestern quadrant of the
state. The total area of the county is approximately 2,632 square miles, of which 2,606 square
miles is land and 26 square miles is water. The county was established in 1873 and attained its
present boundaries in 1978. The county seat is Bozeman, which is in the northern portion of the
county. A map of Montana with counties identified is below and a map of Gallatin County is on
the following page.
Geographical Information
Counties adjacent to Gallatin County are Madison County to the west, Jefferson County to the
northwest, Broadwater County to the north, Meagher County to the northeast, Park County to the
east, Park and Teton Counties, Wyoming to the southeast, and Freemont County, Idaho to the
southwest. The Gallatin National Forest and Yellowstone National Park are national protected
areas located in Gallatin County.
City and Communities
Bozeman, Belgrade and Three Forks are incorporated cities in Gallatin County. The incorporated
towns in Gallatin County are Manhattan and West Yellowstone. County population centers
include: Amsterdam-Churchill, Big Sky, Four Corners and Willow Creek. Communities include
Gallatin Gateway, Logan and Maudlow.
Population
Gallatin County is the 4th most populous county in Montana. The 2012 county population estimate
from the US Census Bureau was 91,377. The population increased a total of 32% or 3.2% per
year between 2000 and 2010. The Environmental Systems Research Institute (ESRI) forecast for
2012 was 91,667 and for 2015 it is 106,595.
Subject County
Clark Real Estate Appraisal (14-006es) (01/30/2014) 120
Income
According ESRI forecasts the median household annual income in 2013 for Gallatin County was
$51,952, which is higher than the 2013 ERSI estimated median household income for Montana in
of $44,613. According to the American Community Survey data in 2009, the most recent year for
which data is available, 14.1% of the Gallatin County population was below the poverty line. This
is equal to the estimated 14.1% poverty rate for the
State of Montana.
Employment
According to ESRI there were 48,573 residents of
Gallatin County over 16 years of age in the
workforce. Of these, 95.6% were employed in
Gallatin County. The county unemployment rate
(non-seasonally adjusted) per the Montana
Department of Labor and Industry as of December
2012 was 4.9%. This is below the December 2012
unemployment rate for the state of 5.7%.
According to ESRI, approximately 49.6% of the
workforce in Gallatin County is employed in service
industries (education services, lodging, health
services, professional services, etc.). The next largest
employment categories are retail trade, construction
and manufacturing with 12.1%, 9.8%, and 5.7% of
the workforce respectively. The remaining
categories of agriculture/mining, transportation,
communication, utilities and wholesale trade each
employ less than 4.0% of the workforce per
category.
Montana State University is the major employer in Gallatin County. The top 20 private employers
in Gallatin County are listed in the table to the left.
Real Estate
According to the ESRI estimate there were 43,880 housing units in Gallatin County in 2013 and
50.2% are owner occupied. The 2010 Census indicated 42,289 housing units and a home ownership
rate of 52.7%. According to the American Community Survey (ACS) data from 2005 -2009, which
is the most recent data available, approximately 59.8% of the homes in Gallatin County were single
family detached; approximately 31.2% were multi-family type units; and approximately 9% were
mobile homes.
Business Name Number of
Employees
Albertson's 100-249
Bozeman Deaconess Hospital 1000-4999
Community Food Co-Op 100-249
Costco 100-249
First Security Bank 100-249
Gibson Guitar 100-249
Kenyon Noble Lumber & Hardware 100-249
Lowes 100-249
Martel Construction 100-249
McDonalds 100-249
Murdoch's Ranch & Home Supply 100-249
Reach Inc.100-249
Ressler Motor 100-249
Right Now Technologies 500-999
Rosauers 100-249
Target 100-249
Town & Country Foods 100-249
Town Pump Convenience Stores 100-249
Wal Mart 250-499
Zoot Enterprises 100-249
Top 20 Private Employers in Gallatin County Based
on 2nd quarter 2011 Data:
Source: Montana Department of Labor and Industry
Clark Real Estate Appraisal (14-006es) (01/30/2014) 121
Montana is a nondisclosure
state which means that
property sales prices are not
public record. There are few
succinct sources of realty
transfer data available. Historical
data on home sales volume and
median price for Gallatin County
from city-data.com is included in
the chart on the right.
This data indicates that the
median home sale price for
Gallatin County was
approximately $260,000 in the
4th quarter of 2013. This is the
approaching the high point for
the study period, which was in the 1st two quarters of 2008. According ERSI housing data, the median
price of homes in Gallatin County is $266,200. Based on the city-data.com chart, the number of sales
per quarter has declined in the 4th quarter of 2013, (the most recent quarter for which data was
available). Historically, seasonal fluctuations in volume have been typical for the Gallatin County
market and the 1st and 4th quarters of each year are often the lower in sales volume than 2nd and 3rd
quarters.
Education & Healthcare
There are multiple elementary schools, middle schools and high schools in the various population
centers of Gallatin County. Montana State University is located in Gallatin County in the city of
Bozeman. MSU is the largest university in the state with a total enrollment above 15,000 (head count)
in the fall of 2013. In addition to the Bozeman Deaconess Hospital there are numerous medical clinics
located in the various population centers of Gallatin County.
Linkages & Transportation
US Interstate 90 extends east to west through Gallatin County straddling the city of Bozeman. US
Highway 191 extends north to south connecting Bozeman with Big Sky and West Yellowstone to the
south. Airports in Gallatin County include Bozeman Yellowstone International Airport near the city
of Belgrade and Gallatin County Airport at Progreba Field, located near the city of Three Forks.
Montana Rail Link, a privately held, Class II railroad, traverses east to west alongside US Interstate
90.
County Data Conclusion
The population of Gallatin County has increased considerably since 2000. The county provides a
variety of employment opportunities including Montana State University, Bozeman Deaconess
Hospital and RightNow Technologies. The county unemployment rate is lo wer than that of the
state and the nation. The economy and the real estate market have remained relati vely stable since
2010. Overall, the economy of Gallatin County is considered stable due to the influence of the
university and proximity to Yellowstone National Park and other recreational opportunities.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 122
CITY OF BOZEMAN DATA
The city of Bozeman is located in southwest Montana and is the county seat of Gallatin County.
The city was platted in August 1864 and was incorporated in April 1883. The city is named after
John M. Bozeman, who established the Bozeman Trail and was a key founder of the city.
Population and Income
Based on ESRI, the 2013 estimated population of the city of Bozeman was 38,358. The 2010 Census
indicated a population of 37,280, which is a 26.0% increase from the 2000 population of 29,510. The
forecast for 2018 indicates a population of 40,466. The Bozeman population makes up approximately
41.5% of the total Gallatin County population.
According to ESRI estimates, the median household income for residents in the city of Bozeman in
2013 was $42,674, which was lower than the median household income of $44,613 in Montana and
lower than $51,314 for all U.S. households. The forecast for 2018 is for a median household income
of $52,364 in the city of Bozeman.
Employment
According to the ACS 2005-2009 estimate, there were 22,628 employed in the Bozeman Work
Force over the age of 16. Employment by specific industry is indicated in the following table.
Agricultural/Mining 1.6%
Construction 10.8%
Manufacturing 4.6%
Wholesale Trade 1.8%
Retail Trade 15.2%
Transportation/Utilities 1.9%
Information 1.6%
Finance/Insurance/Real Este 5.9%
Professional/Scientific/Technical 8.6%
Educational Services 14.96%
Public Administration 2.4%%
Health Care/Social Assistance 7.7%
Accommodation/Food Services 10.8%
Arts/Entertainment/Recreation 3.8%
Other Services 8.4%
Two of Bozeman’s largest employers are Montana State University and Bozeman Deaconess
Hospital. MSU employs over 3,500 individuals that equates to over 2,700 full time equivalents.
Montana State University recently announced plans to grow enrollment by 2,000 students in the
near term. Bozeman Deaconess Hospital is the larges t private employer with over 1,400
employees, of which 821 are full-time employees. In addition, there are at least eight companies
which are engaged in research or production of laser optic equipment, over a dozen bio -tech
companies, and several large nationally-known high-tech companies, including Oracle
Corporation, Ligocyte Pharmaceutical, Bacterin International, and ILX Lightwave Corporation.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 123
Other nationally-known companies based in Bozeman include Gibson Guitar Corporation,
Mystery Ranch Backpacks and Simms Fishing Products.
Commercial Real Estate
Properties improved with general office, medical office or retail space are located throughout the
Bozeman area. Retail hubs include the CBD of Bozeman along Main Street, 7 th Avenue and 19th
Avenue from Main Street and north to Interstate 90.
Commercial construction has increased in recent years along Main Street and 19 th Avenue. There
is some vacant retail and office space but vacancy rates are relatively low and occupancy rates are
estimated to be at 85% to 95%.
Historic commercial sales in the city of Bozeman that were marketed on the area MLS are
presented on the table below:
Based upon our research, on average there were 33 sales of commercial properties per year in the
city of Bozeman throughout the past 10 years. The most recent annual sales volume is 23% higher
than 2012 and shows sustained growth since 2009. We identified 58 active listings of commercial
properties in the city of Bozeman and 6 pending commercial sales. This indicates approximately a
2 year supply of commercial properties in the Bozeman market area.
Residential Real Estate
According to ERSI 20123 estimates, there are 18,057 housing units and 16,322 households in
Bozeman. The ERSI forecast for 2018 indicates 19,552 housing units and 17,396 households. Based
on 2013 estimates 38% are owner occupied, 52.4% are rented, and 9.6% are vacant. As of 2009, the
ASC Survey indicates approximately 43% of these are detached single-family homes, 5% are mobile
homes, and the remainder are comprised of multi-family units.
Montana is a nondisclosure state which means that property sales prices are not public record.
There are few succinct sources of realty transfer data available. According to the 2013 ESRI
estimates, the median home value in Bozeman was $221,611, compared with $169,649 for Montana
and $177,257 for the United States. The median home value in Bozeman is projected to increase to
$260,398 by 2018, reflecting a 3.28% annual increase.
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
10 Year
Total
Business with Land and Building 1 1
Commercial Condos 9 9 24 22 11 6 5 3 17 16 122
Comm/Ind. Subdivision Lot 17 6 5 0 0 0 0 0 0 0 28
Commercial Land & Building 9 25 10 10 6 7 10 12 10 18 117
Vacant Commercial Land 6 19 10 5 3 1 1 7 8 60
Grand Total 41 59 49 38 20 13 16 16 34 42 328
City of Bozeman Commercial Sales on Area MLS in Past 10 Years
Source: SW MT MLS as of December 2013
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According to our research on the area MLS, the median single family home price in Bozeman
increased from $254,500 in 2012 to $277,710 in 2013, indicating a 9.12% increase.
Historical data on home sales
volume and the median price
of home sales in Bozeman
from city-data.com is
included in the table to the
left.
This information indicates
that the median sale price of
homes in Bozeman was
approximately $280,000 in
the 4th quarter of 2013. This is
higher than the median price
at any time during the study
period (2008 forward).
According to this data, the
sales volume has ranged from
175 to 405 per quarter in the past year. Seasonal fluctuations in sales volume are common.
At $280,000, the median home price is unaffordable for families with a median household income of
$42,674. This conclusion is based upon a 10% down payment with a 30 year mortgage at a rate of
5%. (PI payment of $1,353; $42,674/12 = $3,556; $1,353/$3,556 = 38.04% of gross pay without taxes
and insurance).
The table below provides the historical residential building permit activity. Permit activity in 2013
indicates substantial growth in single- and multi-family development.
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Total
2013
Percentage
Decade
Percentage
Single Family 260 265 257 214 93 71 144 160 146 205 1,815 32.64%37.04%
Duplex/TH 214 204 121 151 65 12 24 12 14 4 821 0.64%16.76%
Multi-Family 400 486 292 391 84 99 40 27 11 419 2,249 66.72%45.90%
Manufactured 7 0 0 8 0 0 0 0 0 0 15 0.00%0.31%
Total 881 955 670 764 242 182 208 199 171 628 4,900 100.00%100.00%
Residential Building Permit Activity in Bozeman
Source: City of Bozeman Planning Department
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The chart below indicates the number of lot sales and average prices over the past 4 years. There was
a sharp increase in the number of sales in 2012 and a modest increase in 2013. In 2012, the average
lot price dipped in part due to the number of builders purchasing bulk sales of lots.
There are 117 active listings of similar type lots on MLS as of the effective date of this report, with
an average asking price of $90,982. Based on our interviews of market participants, the area MLS
has typically carried 200 to 300 lot listings in recent years.
Recreation
Bozeman is located in an area that provides outdoor enthusiasts with an abundance of opportunity
for recreational activities. It is located approximately 4 miles southwest of the Missouri River
Headwaters State Park and approximately 90 miles north of Yellowstone National Park. Blue -ribbon
trout fishing is available on the Gallatin, the Madison and Yellowstone Rivers. It sits at an elevation
of 4,793 feet with numerous mountain ranges surrounding it for hiking, backpacking and mountain
biking in the summer. Downhill skiing is available just 16 miles northeast of Bozeman at Bridger
Bowl Ski Resort. Big Sky Resort and Moonlight Basin offer additional downhill options and are just
50 miles southwest of Bozeman. Bozeman also supports over 40 public parks, many of them dog-
friendly, while others feature tennis, ice skating and playground equipment. The city also includes
many streets with biking lanes and a variety of trails throughout the city.
In addition to all that Montana State University provides, Bozeman also offers many venues for
events. The Emerson Center for the Arts and Culture is a primary venue for plays, music
productions and movies. The Museum of the Rockies was created in 1957 a s the gift from Butte
physician Caroline McGill and is a part of Montana State University and an affiliate institution of
the Smithsonian. It is Montana's premier natural and cultural history museum and houses
permanent exhibits on dinosaurs, geology and Montana history, as well as a planetarium and a
living history farm. Paleontologist Jack Horner is the museum's curator of paleontology and
brought national notice to the museum for his fossil discoveries in the 1980s.
90 70 189 209 117
$56,748
$64,488
$45,164
$61,673
$90,982
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
$100,000
0
25
50
75
100
125
150
175
200
225
Nu
m
b
e
r
o
f
H
o
m
e
S
i
t
e
s
S
o
l
d
Period
Single Family Lots Sales in the City of Bozeman on Lots Less than 0.5 Acres in Size
Lot Sales Volume Average Lot Sales Price
Clark Real Estate Appraisal (14-006es) (01/30/2014) 126
Education & Healthcare
Bozeman is home to Montana State University, a major research institution with an enrollment of
15,294 students in Fall of 2013. The Bozeman School District operates one high school-Bozeman
High School; two middle schools—Chief Joseph Middle School and Sacajawea Mi ddle School;
and seven elementary schools – Emily Dickinson Elementary School, Hawthorne Elementary
School, Hyalite Elementary School, Irving Elementary School, Longfellow Elementary School,
Morning Star Elementary School, Whittier Elementary School and Meadowlark Elementary
School.
Bozeman Deaconess Hospital is an 86 bed acute care hospital with over 150 physicians on medical
staff. Additionally there are a variety of clinics and healthcare professionals located in Bozeman that
are not associated with the Bozeman Deaconess Healthcare group.
Linkages & Transportation
Bozeman is intersected by US Interstate Highway 90. A new interchange is proposed for construction
on the northwest side of the city that would provide better access to Bozeman Yellowstone
International Airport. Funding has been set aside and the project is set to begin in 2013 and be
completed by 2015. Bozeman is also a primary rail link, serving east-to-west rail traffic. Streamline
bus service offers fare free public transportation throughout the Bozeman area and seasonally to
Bridger Bowl Ski area. It also connects with the Skyline bus system that offers transportation to Big
Sky.
Bozeman Conclusion
Bozeman’s population is growing and housing lots are being acquired at a pace not seen in the past
several years. The overall economy of the area remained relatively stable during the economic
downturn due to the influence of the University and technology companies in the area. The real
estate market did decline during the recession, but has started to rebound in the past two years.
Future growth and expansion are considered likely in both the short and long term.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 127
City of Bozeman Map
Subject
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ENGAGEMENT LETTER
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SUBJECT DEED
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REFERENCES
“Bozeman City Commission Votes Unanimously to Pursue Sale of Story Mansion.”
bozemandailychronical.com. The Bozeman Daily Chronicle, August 2, 2011.
Bergsman, Steve. “B & B& B: Bed and Breakfast and Beyond”, Valuation, 1st Quarter 2013.
Bristor, Allyson C. City of Bozeman Commission Memorandum: Story Mansion Community
Center CUP/COA/DEV - #Z-09022, April 13, 2009.
“City Commission Votes to Keep the Mansion with Conditions.” friendsofthestory.org. Exergy
Friends of the Story Mansion, February 7, 2011.
“City of Bozeman Commission Resolution No. 4227 (Public Parkland Declaration).” The City
of Bozeman, December 14, 2009.
“City of Bozeman, Montana Request for Proposals to Purchase or Obtain by Gift the Story
Mansion.” The City of Bozeman, May 23, 2013.
“City of Bozeman Ordinance No. 1821: Purchase and Sale Agreement”, April, 2012.
“City to Get Appraisal on Story Mansion.” bozemandailychronicle.com. The Bozeman Daily
Chronicle, November 12, 2013.
Comma-Q Architecture, Inc. The Historic T.B. Story Mansion, Architectural Assessment.
Bozeman, Montana, August 2003.
Higgins, Adrian. “Perfect Harmony.” Valuation Insights & Perspectives, First Quarter 2000.
Huso, Deborah R., “This Old Write Off.” Valuation, 3rd Quarter, 2012,
Kilpatrick, John A., and Adams, Victoria B. “Preservation Easements.” The Journal of Wealth
Management, Summer 2008.
Kukulski, Chris. City of Bozeman Commission Memorandum: Set a clear direction for the future
of the Story Mansion, February 7, 2011.
Kukulski, Chris. City of Bozeman Commission Memorandum: Consider proposals received for
the Story Mansion and associated property and authorize the City Manager to move
forward with the preferred proposal, November 12, 2013
“Montana House Bill 645 Historic Preservation Competitive Grant P rogram.”
recovery.mt.gov/commerce/hpg/default.mcpx. 2009
Reynolds, Judith, MAI. “The Costs and Benefits of Historic Properties.” The Appraisal
Journal, Spring 2006.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 136
Reynolds, Judith, MAI. LaCrosse WI: March 4, 2014. Interview.
Story Mansion Proposal: “Bozeman Art Museum”, 2013.
Story Mansion Proposal: “The Montana Center for Civics Engagement at the Story Mansion”,
2013.
Story Mansion Proposal: “The Story Mansion Inn Project”, 2013.
Story Mansion Proposal: “Tree of Life Ministries and the Portal School of Creativity and
Innovation”, 2013.
“Story Mansion to Get Facelift.” bozemandailychronicle.com. The Bozeman Daily Chronicle,
April 13, 2005.
T.B. Story Mansion and Carriage House Conservation Easement Agreement for Save America’s
Treasures Grant No. 30-04-ML-0046, Gallatin Clerk and Recorder’s Office, Document #
2338483, July 31, 2009.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 137
The Secretary of the Interior’s Standards for the Treatment of Historical Properties
Standards for Preservation
1. A property will be used as it was historically, or be given a new use that maximizes the retention of distinctive
materials, features, spaces, and spatial relationships. Where a treatment and use have not been identified, a
property will be protected and, if necessary, stabilized until additional work may be undertaken.
2. The historic character of a property will be retained and preserved. The replacement of intact or repairable
historic materials or alteration of features, spaces, and spatial relationships that characterize a property will be
avoided.
3. Each property will be recognized as a physical record of its time, place, and use. Work needed to stabilize,
consolidate, and conserve existing historic materials and features will be physically and visually compatible,
identifiable upon close inspection, and properly documented for future research.
4. Changes to a property that have acquired historic significance in their own right will be retained and
preserved.
5. Distinctive materials, features, finishes, and construction techniques or examples of craftsmanship that
characterize a property will be preserved.
6. The existing condition of historic features will be evaluated to determine the appropriate level of intervention
needed. Where the severity of deterioration requires repair or limited replacement of a distinctive feature, the
new material will match the old in composition, design, color, and texture.
7. Chemical or physical treatments, if appropriate, will be undertaken using the gentlest means possible.
Treatments that cause damage to historic materials will not be used.
8. Archeological resources will be protected and preserved in place. If such resources must be disturbed,
mitigation measures will be undertaken.
Standards for Rehabilitation
1. A property will be used as it was historically or be given a new use that requires minimal change to its
distinctive materials, features, spaces, and spatial relationships.
2. The historic character of a property will be retained and preserved. The removal of distinctive materials or
alteration of features, spaces, and spatial relationships that characterize a property will be avoided.
3. Each property will be recognized as a physical record of its time, place, and use. Changes that create a false
sense of historical development, such as adding conjectural features or elements from other historic properties,
will not be undertaken.
4. Changes to a property that have acquired historic significance in their own right will be retained and
preserved.
5. Distinctive materials, features, finishes, and construction techniques or examples of craftsmanship that
characterize a property will be preserved.
6. Deteriorated historic features will be repaired rather than replaced. Where the severity of deterioration
requires replacement of a distinctive feature, the new feature will match the old in design, color, texture, and,
where possible, materials. Replacement of missing features will be substantiated by documentary and physical
evidence.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 138
7. Chemical or physical treatments, if appropriate, will be undertaken using the gentlest means possible.
Treatments that cause damage to historic materials will not be used.
8. Archeological resources will be protected and preserved in place. If such resources must be disturbed,
mitigation measures will be undertaken.
9. New additions, exterior alterations, or related new construction will not destroy historic materials, features,
and spatial relationships that characterize the property. The new work shall be differentiated from the old and
will be compatible with the historic materials, features, size, scale and proportion, and massing to protect the
integrity of the property and its environment.
10. New additions and adjacent or related new construction will be undertaken in a such a manner that, if
removed in the future, the essential form and integrity of the historic property and its environment would be
unimpaired.
Standards for Restoration
1. A property will be used as it was historically or be given a new use which reflects the property's restoration
period.
2. Materials and features from the restoration period will be retained and preserved. The removal of materials
or alteration of features, spaces, and spatial relationships that characterize the period will not be undertaken.
3. Each property will be recognized as a physical record of its time, place, and use. Work needed to stabilize,
consolidate and conserve materials and features from the restoration period will be physically and visually
compatible, identifiable upon close inspection, and properly documented for future research.
4. Materials, features, spaces, and finishes that characterize other historical periods will be documented prior to
their alteration or removal.
5. Distinctive materials, features, finishes, and construction techniques or examples of craftsmanship that
characterize the restoration period will be preserved.
6. Deteriorated features from the restoration period will be repaired rather than replaced. Where the severity of
deterioration requires replacement of a distinctive feature, the new feature will match the old in design, color,
texture, and, where possible, materials.
7. Replacement of missing features from the restoration period will be substantiated by documentary and
physical evidence. A false sense of history will not be created by adding conjectural features, features from
other properties, or by combining features that never existed together historically.
8. Chemical or physical treatments, if appropriate, will be undertaken using the gentlest means possible.
Treatments that cause damage to historic materials will not be used.
9. Archeological resources affected by a project will be protected and preserved in place. If such resources
must be disturbed, mitigation measures will be undertaken.
10. Designs that were never executed historically will not be constructed.
Standards of Reconstruction
1. Reconstruction will be used to depict vanished or non-surviving portions of a property when documentary
and physical evidence is available to permit accurate reconstruction with minimal conjecture, and such
reconstruction is essential to the public understanding of the property.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 139
2. Reconstruction of a landscape, building, structure, or object in its historic location will be preceded by a
thorough archeological investigation to identify and evaluate those features and artifacts which are essential to
an accurate reconstruction. If such resources must be disturbed, mitigation measures will be undertaken.
3. Reconstruction will include measures to preserve any remaining historic materials, features, and spatial
relationships.
4. Reconstruction will be based on the accurate duplication of historic features and elements substantiated by
documentary or physical evidence rather than on conjectural designs or the availability of different features
from other historic properties. A reconstructed property will re-create the appearance of the non-surviving
historic property in materials, design, color, and texture.
5. A reconstruction will be clearly identified as a contemporary re -creation.
6. Designs that were never executed historically will not be constructed.
http://www.nps.gov/hps/tps/standguide/
Clark Real Estate Appraisal (14-006es) (01/30/2014) 140
Architects Confirmation of
Square Foot Estimates for Story Mansion as of 2008 Renovation
From: Ashley Flynn [aflynn@BOZEMAN.NET]
Sent: Thursday, February 13, 2014 11:11 AM
To: Sandra Kennedy
Subject: FW: Story Mansion drawings of 2008 renovation
Attachments: Story Mansion Site Plan and Floor Plans.pdf
Sandra,
Please find the attached drawings you requested.
From: Kim Everts [mailto:kim@commaq.com]
Sent: Thursday, February 13, 2014 11:10 AM
To: Ashley Flynn
Cc: Ben Lloyd
Subject: Story Mansion drawings of 2008 renovation
Ashley,
Attached are site and floor plan pdf drawings of the Story Mansion Renovation project we prepared in
2008 for James Goehrung.
The gross square feet of the floors is as follows:
Basement: 3,375 s.f.
1st Floor: 3,304 s.f.
2nd Floor: 3,450 s.f.
3rd Floor: 2,840 s.f.
These numbers are based on the drawing we used for the renovation.
Please let me know if you need any other information.
Thanks,
Kim
Kim Everts | Project Manager
Comma-Q Architecture, Inc | 109 N Rouse Ave, #1 | Bozeman, MT 59715 | (406) 585-1112
All City of Bozeman emails are subject to the Right to Know provisions of Montana’s
Constitution (Art. II, Sect. 9) and may be considered a “public record” per Sect. 2-6-202
and Sect. 2-6-401, Montana Code Annotated. As such, this email, its sender and receiver,
and the contents may be available for public disclosure and will be retained pursuant to the
City’s record retention po licies. Emails that contain confidential information related to
individual privacy may be protected from disclosure under law.
Clark Real Estate Appraisal (14-006es) (01/30/2014) 141
REVENUE & EXPENSES WITH APPRAISER PROJECTIONS FOR 2014
Contracted Services increased in recent years due to outsourcing part of the lawn maintenance and snow removal.
< = 2009 2010 2011 2012 2013 3 Yr Avg
Projected
2014
189-0000-344.76-45 RENTAL / STORY MANSION 1,285$ 22,377$ 24,693$ 19,363$ 24,370$ 22,808$ $25,000
189-0000-383.00-00 OTHER REVENUES / DONATIONS
189-0000-386.00-00 OTHER REVENUES / REFUNDS & REIMBURSEMENTS 850$
TOTAL REVENUES 1,285$ 23,227$ 24,693$ 19,363$ 24,370$ 22,808$ $25,000
189-8040-456.20-65 SUPPLIES AND MATERIALS / SMALL EQUIPMENT AND TOOLS 31$ -$ $0
189-8040-456.20-99 SUPPLIES AND MATERIALS / GENERAL 6,485$ 1,005$ 217$ 377$ 533$ $500
189-8040-456.30-10 MAINTENANCE / REPAIR & MAINT- EQUIPMENT 191$ 400$ 210$ 305$ $300
189-8040-456.30-20 MAINTENANCE / REPAIR & MAINT- BUILDINGS 1,141$ 192$ 343$ 176$ 237$ $250
189-8040-456.30-30 MAINTENANCE / REPAIR & MAINT - OTHER 1,819$ 3,043$ 3,043$ $2,000
189-8040-456.40-10 UTILITIES / ELECTRICITY 2,583$ 2,676$ 3,612$ 4,278$ 3,522$ $3,500
189-8040-456.40-20 UTILITIES / WATER SERVICE 394$ 409$ 393$ 620$ 474$ $500
189-8040-456.40-30 UTILITIES / SEWER SERVICE 243$ 238$ 220$ 596$ 351$ $600
189-8040-456.40-40 UTILITIES / NATURAL GAS 6,013$ 4,192$ 3,034$ 3,206$ 3,477$ $3,500
189-8040-456.40-50 UTILITIES / TELEPHONE 1,240$ 1,272$ 1,278$ 1,311$ 1,287$ $1,300
189-8040-456.40-55 UTILITIES / INTERNET 104$ 847$ 982$ 1,058$ 1,020$ 1,020$ $1,000
189-8040-456.40-60 UTILITIES / REFUSE DISPOSAL 780$ 823$ 761$ 750$ 778$ $800
189-8040-456.40-70 UTILITIES / STORM WATER 38$ 38$ $50
189-8040-456.50-20 CONTRACTED SERVICES / MAINTENANCE CONTRACTS 524$ 488$ 2,629$ 8,764$ 3,960$ $8,500
189-8040-456.50-30 CONTRACTED SERVICES / JANITORIAL CONTRACTS 1,565$ 2,342$ 3,007$ 2,722$ 2,691$ $2,700
189-8040-456.50-99 CONTRACTED SERVICES / GENERAL 1,072$ 638$ 312$ 475$ $0
189-8040-456.70-10 OTHER / ADVERTISING 706$ 706$ $0
189-8040-456.70-40 OTHER / POSTAGE 48$ 1$ 1$ $0
189-8040-456.70-60 OTHER / TAXES & ASSESSMENTS 403$ 211$ 486$ 522$ 406$ $500
189-8040-456.70-90 OTHER / RENTS & LEASES 10$ 177$ 177$ $0
189-8040-456.70-99 OTHER / GENERAL 230$ 115$ 115$ 115$ $0
TOTAL EXPENDITURES 104$ 25,620$ 16,688$ 20,507$ 24,769$ 23,596$ $26,000
REVENUES OVER (UNDER) EXPENDITURES **1,181$ (2,392)$ 8,004$ (1,145)$ (399)$ -$1,000
** does not include: Depreciation, Staff Time, Property &
Liability Insurance, any general admin & overhead costs
REVENUES
EXPENDITURES
City of Bozeman - Story Mansion Revenue & Expense Report