Part III of III This article is the third and final of a three-part series on intangible property and property tax appraisals. Read Part I here and Part II here. Valuation analysts are often retained by industrial and commercial companies to assist with state and local property tax planning, compliance, and controversy matters. Often, analysts are retained by the legal counsel for the corporate taxpayers. This is particularly the case when the property tax matter involves an assessment appeal or litigation regarding the amount of the property assessment. The articles in this series focus on the valuation of intangible property…
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(Part IV of IV) Analysts often apply the cost approach to value special-purpose property. And the measurement of economic obsolescence is an important but often controversial procedure in such cost approach analyses. Part one of this four-part series considered economic obsolescence concepts. Part two discussed the generally accepted measurement methods. Part three recommended responses to the most typical assessment authority objections to economic obsolescence measurements. This fourth part recommends best practices responses to other (but still common) assessor objections to economic obsolescence measurements. Introduction Valuation analysis (“analysts”) are often asked to value special-purpose industrial and commercial property. When analysts value…
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(Part III of IV) Part one of this four-part series discussed the unit principle of property appraisal. Part two discussed the methods of economic obsolescence measurement. This third part recommends best practices responses to the most typical assessment authority objections for economic obsolescence measurements. Introduction Valuation analysts (“analysts”) are often asked to develop value for complex industrial and commercial properties for taxation and other purposes. Unit principle appraisals value these complex properties as a single unit operating collectively on a going concern basis. And the analysis of economic obsolescence is an important cost approach component in the unit principle appraisal…
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(Part II of IV) The first of this four-part series considered the differences between the unit principle of property appraisal and the summation principle of property appraisal. This second part describes and illustrates the generally accepted economic obsolescence measurement methods (with particular emphasis on the capitalization of income loss method). Introduction Valuation analysis (“analysts”) are often called on to value complex, special-purpose industrial and commercial property operating collectively as a single “unit” of property. Analysts typically apply the cost approach to value such special-purpose property. This discussion focuses on the identification and measurement of economic obsolescence within the application of…
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(Part I of IV) Valuation analysts (“analysts”) are often asked to value special-purpose industrial and commercial property. These analyses may be developed for various purposes, including taxation purposes. This discussion focuses on the identification and measurement of economic obsolescence in the application of the cost approach to value such special-purpose property. This topic is particularly relevant to the unit principle appraisal of integrated and complex properties operating on a going-concern basis. Analysts and tax assessors often apply the unit principle of appraisal to value such complex industrial and commercial properties for state and local ad valorem tax appeal and litigation…