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08-25-09
15056041158 REV-1500 EX (06-05) OFFICIAL USE ONLY PA Department W Revenue Bureau of IndMdual Texas County Cade Year File Number PO BOX 280801 INHERITANCE TAX RETURN 21 0 8 121 8 Herrlsburg, PA 17128-0801 RESIDENT DECEDENT ENTER DECEDENT INFORMATION BELOW Social Security Number Date of Death Date of Blrth 11282008 10221916 Decedent's Lest Name SufFlx Decedent's First Name ~ M I WRIGHTSTONE CLYDE E (If Applicable) Enter Surviving Spouse's Information Below Spouse's Lest Name Suffix Spouse's First Name M I WRIGHTSTONE HAZEL I Spouse's Social Security Number THIS RETURN MUST BE FILED IN DUPLICATE WITH THE REGISTER OF WILLS FILL IN APPROPRIATE BOXES BELOW 1. Original Return ^ 2. Supplemental Return ^ 3. Remainder Return (date of death prior to 12-13-62) ^ 4 Li it d E t t ^ 4 F I t t C i tl t f ^ 5 F l E T R i d t t t R i . m e s a e a. u ure n eres omprom se ( a e o , era e s a e ax e urn equ red death attar 12-12-82) ^ 6. Decedent Dietl Testate ^ 7. Decedent Maintainetl a Living Trust ~ 8, Total Number of Safe Deposit Boxes (Attach Copy of Will) (Attach Copy of Trust) ^ 9 i P i d i ^ 10 th ^ 11 S l P rt C dit d t f d i El S . Lit on roceetls Rece ve gat . . pousa ove y re ( a e o ea on to taz under ect ec. 9113(A) between 12-31-91 and 1-1-95) (Attach Sch. O) OORRESPONDENT - THIS SECTION MUST BE COMPLETED. ALL CORRESPONDENCE AND CONFIDENTIAL TAX INFORMATION SHOULD BE DIRECTED TO: Name Daytime Telephone Number RICHARD C• SNELBAKER, ESQU IRE 717-697-8528 Firm Name (If Applicable) REGISTER OF S USE ONL p SNELBAKER & BRENNEMAN, P•C• ~a a First line of address C??=~ VCj 44 WEST MAIN STREET :n~~ cNrl Secontl line of address ,-, O ~i a, C) C = P•0• BOX 318 ~ ~ City or Post Office State ZIP Code DA~ILED MECHANICSBURG PA 17055 Correspontlent's a-mail address. Under penalties of perjury, I tledare that I have examinetl this return, indutling accompanying schedules and statements, antl to the best of my knowletlge antl belief, it is true, correct antl complete. Declaration of preparer other then the personal representative is basatl on ell information of which preperar has any knowle OF PERSON RESPONSIBLE FOR FILING RETURN DATE orv ypa~~rr<gr/+ryay/.u~~~ ~rctrr<mtrvrHrrvc ~~`l' ~ uvit8~a4+v4' i °~ ;_ J }, Side 1 '„~ 15056841158 eMaea7aoco 15056041158 1505604215 9 REV-1500 EX Decedent's Social Security Number DecedenPb Namajlj R I G H T S T O N E Y D RECAp17ULATION 1. Real estate (Schedule A) .. .. 1. 280000.00 2. Stocks and Bonds (Schedule B) . ... ..... . 2. ~ • O () 3. Closely Heltl Corporation, Partnership or SoleProprietorship (Schedule C) . 3. 126 32 , 10 4. Mortgages 8 Notes Receivable (Schedule D). ...... . 4. 14 214 • ~ ~ 5. Cash, Bank Deposits & Miscellaneous Personal Property (Schedule E). . 5. 4 3854 • 17 6. Jointly Owned Property (Schedule F) ~ Separate Billing Requested . 6. O • ~ 0 7. Inter-Vivos Transfers & Miscellaneous Non-Probate Property (Schedule G) ~ Separate Billing Requested 7. O • 00 8. Total Gross Asset (total Lines 1-7). .. 8. 35700 7 9. Funeral Expenses&AdministraliveCOSts(ScheduleH) ............ .9, 40654.3 10. Debts of Decedent, Mortgage Liabilities, & Liens (Schedule I). . 10. 4108 , ~3 11. Total Detluctlons (total Lines 9 & 10) . 11. 4 4762 • 33 12. Net value of Estate (Line 8 minus Line 11) .. 12. 30 S 9 37 • 9 4 13. Charitable and Governmental Bequests/Sec 9113 Trusts for which an election to tax has not been made (Schedule J) • .... .. ....... 13. 0 • ~ ~ 14. Net Value Subject to Tax (Line 12 minus Line 13) ... 14. 3O S 9 7 9 4 TAX COMPUTATION -SEE INSTRUCTIONS FOR APPLICABLE RATES 15. Amount of Line 14 taxable at the spousal tax rate, or transfers under Sec. 9116 (a)(1.z>x.o 101979.32 te. 0.00 16. Amount of Line 14 taxable at lineal rate x .045 2 3 9 5 8.6 2 16. 917 8.14 17. Amount of Line 14 taxable at sibling rateX.12 0,~~ 17. ~•~Q 18. Amount of Line 14 taxable at collateral rate X .15 0, 0 0 18. Q• p ~ 19. TAX DUE 19. 20. FILL IN THE BOX IF YOU ARE REQUESTING A REFUND OF AN OVERPAYMENT Side 2 15056042159 BM46462.000 15056042159 9178.14 REV-1500 EX Page 3 • Decedent's Complete Address: FIb Number . ~1. na 1» a DECEDENT'S NAME HT TO C Y srREETADDRESS R A CIT' M CHAN C B R STATE ZIP Tax Payments and Credits: 1. Tax Due (Page 2 Line 19) 2. Credits/Payments A. Spousal Poverty Credit Q • Q Q B. Prior Payments 10 Q Q Q. Q 0 c. Discount 458 • 91 (1) 917 8.14 rotalcredita(A+e+c) (2) 10458 • 91 3. InteresVPenalty if applicable D. Interest _ Q . Q Q E. Penally Q • Q Q Total lnteresUPenaky (D+E) (3) Q.QQ 4. If Line 2 is greater than Line 1 + Line 3, enter the difference. This is the OVERPAYMENT. Fill in box on Page 2, Line 20 to request a refund. (4) 1281] • 77 5. If Line 1 + Line 3 is greater than Line 2, enter the difference. This is the TAx DUE. (5) Q • Q Q A. Enter the interest on the tax due. (5A) B. Enter the fatal of Line 5 + 5A. This is the BALANCE DUE. (58) Q . Q Q Make Check Payable to: REGISTER OF WILLS, AGENT PLEASE ANSWER THE FOLLOWING QUESTIONS BY PLACING AN "X" IN THE APPROPRIATE BLOCKS i. Did decedent make a transfer and: Yes No a. retain the use or income of the property transferred; ^ b. retain the right to designate who shall use the property transferretl or its income; ...... ^ X c. retain a reversionary interest; or ............ .. d. receive the promise for life of either payments, benefits or care? ........... 2. If death occurred after December 12, 1962, did decedent transfer property within one year of death without receiving adequate consideration? .................. 3. Ditl decedent own an "in trust for" or payable upon death bank account or security at his or her death? . x 4. Did decedent own an Indivitlual Retirement Account, annuity, or other non-probate property which contains a beneficiary designation? ....... ............ ^ X^ IF THE ANSWER TO ANY OF THE ABOVE QUESTIONS IS YES, YOU MUST COMPLETE SCHEDULE G AND FILE IT AS PART OF THE RETURN. For dates of death on or after July i, 1994 and before January 1, 1995, the tax rate imposed on the net value of transfers to or for the use of the SurNVing spouse is three (3) percent [72 P.S. §9116 (a) (1.1) (i)]. Far tlates of tleath on or after January i, 1995, the taz rate imposetl on the net value of transfers to or for the use of the surviving spouse is zero (0) percent [72 P.S. §9116 (a) (1.1) (ii)]. The statute does not exempt a transfer to a surviving spouse from tax, and the statutory requirements for disclosure of assets antl filing a tax return are still applicable even if the surviving spouse is the only beneficiary. For dates of death on or after July 1, 2000: The tax rate Imposed on the net value of transfers from a deceased child twenty-one years of age or younger at death to or for use of a natural parent, an adoptive parent, or a stepparent of the child is zero (0) percent [72 P.S. §9116(a)(1.2)1. The tax rate imposed on the net value of transfers to or for the uae of the decedent's lineal benefiGanes is four antl one-half (4.5) percent, except as noted in 72 P.S. §9116(1.2) p2 P.S. §9116(a)(i)j. The tax rate imposed on the net value of transfers to or for the use of the decedent's siblings is twelve (12) percent [72 P.S. §9116(a)(1.3)]. Asibling is definetl, untler Section 9102, as an individual who has at least one parent in common with the decedent, whether by blood or adoption. BM46)1 1.000 REV-1502 EX t (11-08) Pennsylvania ~ SCHEDULE A OEPPRTAIENi OF REVENUE ~k~RRANCE TAX RETURN REAL ESTATE RESIDENT DECEDEt.7 ESTATE OF FILE NUMBER Clyde Wrichtstone 21 08 1218 All real property owned solely or ee a tenant in common moat lw reported affair market value. Fair merkel value is defined ae the pnoe at which property woultl be aXChanged between a willing buyer end a willing seller, neither being compelled to buy or sell, both having reasonable knou/etlga rH the relevant facts. Reel property Mat ie JoiMrycwned with right of survivorship must 6e diseloaad on Schedule F. Attach a copy of the feabmenl sheet if the property has been sdd. ITEM Include a wpy of the deed showing decetlent'e imerosl if w.anetl as tenant in common. VALUE AT DATE NUMBER DEBCRIP'iION OF DEATH 7. Property known and numbered as 280,000.00 Follows: 100-102 South Market Street and 5 West Locust Street Mechanicsburg Borough, Cumberland County, Mechanicsburg, PA. Appraised value (sea attached appraisal) TOTAL (Also enter on Line 1, Recapitulation.) S 260 000.00 ewaass z.oco If more space is needetl, insert additional sheets of the same size. SUMMARY APPRAISAL REPORT 100-102 S. Market Street 8~ 5 W. Locust Street Borough of Mechanicsburg, Cumberland County Mechanicsburg, Pennsylvania 17055 FOR Estate of Clyde Wrightstone c/o Richard C. Snelbaker, Esquire 44 W. Main Street, PO Box 318 Mechanicsburg, PA 17055 DATE OF VALUATION November 28, 2008 PREPARED 8Y RSR APPRAISERS & ANALYSTS 3 LEMOYNE DRIVE LEMOYNE, PA 17043 (T17) 763-1212 1 i ~ appraisers analysts May 5, 2009 Snelbaker & Brenneman, P.C. Attn: Richard C. Snelbaker, Esquire 44 W. Main Street, PO Box 318 Mechanicsburg, PA 17055 RE: 100-102 S, Market St. & 5 W. Locust 5t. Mechanicsburg, PA 17055 Estate of Clyde Wrightstone Dear Mr. Snelbaker, At your request, RSR Appraisers & Analysts has prepared a retrospective Summary Appraisal report on the above referenced property. The effective date of the appraisal is November 28, 2008. The report that follows provides a summary description of the property, and the basis upon which the opinion of value has been developed. The purpose of this appraisal is to provide an opinion of market value of the subject property for estate settlement purposes and no other use is intended. The property rights appraised in this report are the fee simple interests. This appraisal has been developed as if the property were free and clear of any Viens or encumbrances. This letter does not constitute a full appraisal of the subject property. The report that follows provides a summary description of the property and the basis upon which the opinion of value has been developed, This letter must remain attached to the r®port in order for the value opinion set forth to be considered valid. Based on my inspection of the subject property, the investigation and analysis undertaken, and subject to then"Underlying Assumptions and Umiting Conditions" noted in this report, it is my opinion that the estimated retrospective market value of the fee simp{e interest, as of November 28, 2008, was= *"«TWO HUNDRED AND EIGHTY THOUSAND DOLLARS"'"' ($280,000) It is assumed that there are no hidden or undisclosed conditions of the land which, would render the. property more or less valuable. Furthermore, I have not conducted a review of environmental related matters and assume the absence of asbestos, radon and any other ., environmentally hazardous or sensitive materials or deposits on the property. 2 C~ • Richert C. Snelbaker, Esquire M®y 5, 2009 i This report has been prepared in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation, the Code of Ethics and Standards of Professional Practice of the Appraisal Institute, and Title XI of the Federal Financial Institutions Refdrm, Recovery and Enforcement Act (FIRREA). This appraisal was not requested with a minimum valuation, a specific valuation, or based on the approval of a loan. My compensation is in no way contingent upon the value estimate and I will be available to discuss the findings contained within the report with the respective parties at your request and convenience. Respectfully submitted, ~~~ ~.. RSR Appraisers & Analysts Karen Darney, Certified General Reai Estate Appraiser Pennsylvania Certification Number: GA001260L RSR File # 09-012KD ~3 TABLE OF CONTENTS Letter of Transmittal .................................................................... 2 Table of Contents ........................................................................ 4 Summary of Salient Facts ........................................................... 5 Subject Photographs ................................................................... 6 Area Map ..................................................................................... 15 Narrative Section:. Client, Appraisers, Subject ............................................. ............. 16 Location .......................................................................... ............. 16 Effective Date of Value ................................................... ............. 16 Date of Appraisal ............................................................ ............. 16 Description {Scope) of Appraisal Process ...................... ............. 16 Competency of Appraiser ..:........................................... ............. 17 Intended Use of Appraisal ............................................. ............. 18 Intended User of Appraisai ......................................:..... :............ 18 Interest or Property Rights Valued ..............:................... ............. 18 Market Value Definition .................................................. ............. 18 Non-Real Property .......................................................... ............. 19 Hazardous Materials ...................................................... ............. 19 Ownership ...................................................................... ............. 19 Exposure Time ............................................................... ............. 19 Marketing Period ............................................................ ........:.... 20 Regional Analysis ........................................................... ............. 20 Neighborhood Analysis .................................................... ............. 25 Site Description .............................................................. ............. 28 Building Descriptions ...................................................... ............. 29 Leases ............................................................................ ............. 32 Zoning ...............................:.....................................:..... .............. 33 Assessment &Taxes ...................................................... .............. 35 Highest & Best Use ....................................................... .............. 35 Valuation Process ........................................................ .............. 38 Income Capitalization Approach ..................................... .............. 39 Sales Comparison Approach -Improvement Valuation . .............. 54 Reconciliation & Conclusion .......................................... .............. 64 Appraiser's Certification ................................................. .............. 66 Unapparent Conditions ........:......................................... .............. 67 Assumptions and Limiting Conditions ............................ .............. 67 Appraiser Qualifications .......................................... ........... 69 Addendum: Neighborhood Map Tax Map Legal Description Zoning Map & Ordinance Income.and Expenses Data Flood Map Lease Agreements 4 • • SUMMARY OF IMPORTANT FACTS AND CONCLUSIONS LOCATION: 100-102 S. Market Street & 5 W. Locust Street Borough of Mechanicsburg, Cumberland County; Mechanicsburg, PA 17055 OWNERS OF RECORD: Clyde Wrightstone TAX ID NUMBER: 16-23-0565-057 LAND DATA: Size: 0.202 acre Shape: Rectangular Zoning: "C-N", Commercial-Neighborhood IMPROVEMENTS: Two story cement black retail building attached to a two story aluminum sided retai{ building with one residential apartment above; plus, a detached two story retail building with one apartment above. PERSONAL PROPERTY: Two ranges, 2 refrigerators, and 2 clothes washerldryers UTILITIES: HIGHEST AND BEST USE: RIGHTS APPRAISED: Purpose: Interest: REASONABLE EXPOSURE TIME: VALUE OPINIONS: RETROSPECTIVE MARKET VALUE; DATE OF VALUATION: DATE OF INSPECTION: DATE OF REPORT: All Publio Available As improved with three multi-use buildings Retrospective Market value for estate settlement Unencumbered Fee Simple Estate 6 -18 months Cost Approach Income Approach Income Approach SaleslMarket Approach $280,000 NIA $270,000 $280,000 with Tax Built-up Cap Rate $278,000 November 28, 2008 January 9, 2009 May 5, 2009 5 _.._ Sul iect Photo~ranhc 6 Front view of 100 S. Market Street (Brick attached building) and 102 S. Market Street (white sided attached building) ncar wew or i op-102 S. Market Street. SUBJECT PHQTQGRAPI~S 7 Interior view of 100 S. Market Street. interior view of the 2^d Floor of 100 S. Market Street. SUBJECT PHOTOGRAPHS 8 Basement view of 100 S. Market Street. F • • ~~~. ,=.a~~ aiea in i ut ~. Market Street. SUBJECT PHOTOGRAPHS Kitchen view in second level apartment in 102 S. Market Street. 9 SUBJECT PHOT©GRAPHS 10 Street View of S. Market Street looking north. Street view of S. Market Street looking south. SIJB.TEGT PI~f~TOGRAPHS 1T ~ w. locust Street -Front and east side Parking lot on west side of building. ~ w. Locust Street -Front and weft side of building. View of parking lot. SUBJECT PHpTOGRAPHS 12 ------ ~~• ~~=~a~~ area on nrst level. -- --- -~~•• ~~ uueyra~ rear garage SUBJECT P~IOTOGRAPHS 13 ---• y~, Qy= nuacnea to rear addition. - -.. ~~~~~• ~~. - nitcnen in 2~a Level apartment. SUBJECT PH©TOGRAPHS 14 ~~reec view or w. locust Street looking west. ~uee~ view or w. Locust Street looking east. 326' D A U P~ H i 341 i ~. _ 122 ~ I N .......... MapPoint° ,. ~; ~~: .Dauphin A`• ~.. SusqueAanne `. -_~ 11 1 .u\I l Country Club of Harrisburg Chestnut Grove Cemetery ~~ ~1 P E P, R Y M~ryeville' ~ ~h~ ,.~ -~ ,,--- ~ - -.-.~ ~~~ ~ ~I l;,• 6• , ~'I~- ...... .... ...... ......... .... .. ...... .. ...... ... .... .. ..... ~ ~ '•. P ~:I 7 ~ ....: ..... ..... ayat~t s't 1 Sal ; ~ a I ' ...... ~" -~., ?~ ~~ it _ ~ - ~' 1, ~ ~zx'I i I ~ Gf: 44++ ~ yy~ .. Rlch ValleY_ i+~ ~ ~ t1 ~ WormieYSbur "~. ,.~ '' `y i , Gdf r1f4 `SQie gh~`~ fuMNa'iS~Nf~ , ,. At ~~` ~ tv YJC i , - ~~-' ,,,. ~-:~= ~ xp Lemoyne x ~ ~ \ I,Y ._._ ~ I <~:::: arl' k Pike , 4 Kemp Nill ddlesex _. y_ ;~, __ r- C U M B E F L A N D ~ ~ ~ ~j. 4 I ~ 11 ~ .cam'- i .. .. rdHixle-Ra~ ~.._~- A _ __ _ _ e -- N w _.. \"-,~' '8~ -.,.__ ,a47 .. -.. . ' 1, Cu enend ~ rat 4a P E N N S~Y 1L Y A'W''I A ~- Shr Nown ,; e y -- - l lechanicaburg .. -' : " j' ~ , \ '~ ~I J I `' .- . "r i ~ / ~ .: l / ~' 'PC ~ 120.+-_.-. ~::.. :''-~. ~ ;: ~• .. _. 1114 t' ___ 9 ~~~ ~, a , I ~ A 6 ~~ 7a .. ~~ 74 ._ ~ i ~. Boiling° - - 3 '~ ~ ~ SPringx , ,'~ ~ p ~~ ~~ 382.1 f: ~ ~, ~ J /,.. /J ~ ~ _ _ _ l~, • ~ JJf~ 1 gillsburp ~ ~ I 111, -Range End /~ Vyl] -~.. .._- •`• •~ Oolt Chit j '~ ' . 7 -__z ~i ' i ~.. -- : '~ Stone Head ~ ~ NonA -.. -%N..pe~ (y7p/ f ~ ,, J t i ,/ ~~ h . .J1 ----~iFrenklhrt~a+rn "..,~ '~ a GNFOrtl .... ~~ (1 It p4; \ /"/ Pinchot! ~~ x SYHe 1 p. ~~~ ~~ ~~a .~ __ ~ @~ Perk ,~. FF § IV41 ~ 4 1 "'6 ~,;7q~ Scde A D A M S ~/ Ir~ 2, I ~k.'. s~ ml IL j I Z I ~ ~ e120o9~al0esatcar b100a NOrRe.Majeral~la#,Me~ J, ~ 'Pp, ~~ ., .;~ a, _ y"4.. SUMMARY APPRAISAL REPORT 't This appraisal report is prepared in a Summary Appraisal Report format, which is intended to comply with the reporting requirements set forth under Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Summary Appraisal Report. As such, it presents only summary discussions of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser's opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser's file. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated below. The appraiser is not responsible for unauthorized use of this report. Client: Snelbaker & Brenneman, P.C. ATTN: Richard C. Snelbaker, Esquire 44 W. Main Street, PO Box 318 Mechanicsburg, PA 17055 Appraiser: Karen Darney PA Certified General Real Estate Appraiser RSR Appraisers & Analysts 3 Lemoyne Drive Lemoyne, PA 17043 Subject: 100-102 S. Market Street & 5 W. Locust Street Borough of Mechanicsburg, Cumberland County, Mechanicsburg, PA 17055 Location: the subject property is located in the heart of the Borough of Mechanicsburg, one block south of the intersection of Route 641, aka Main Street and Route 114 South, aka Market Street, in the Borough of Mechanicsburg, Cumberland County, Mechanicsburg, PA 17055. It is also identified as Cumberland County Tax Map Parcel #16-23-0565-057, a copy of which has been included in the addendum of this report identifying the perimeter boundaries of the subject property. Existing Use of Subject Property: as of the date of value, consists of a mix of use(s) with 100 S. Market Street utilized as an owner occupied electrical officelratail parts sales; 102 S. Market Street utilized as retail sales on the first level and a two bedroom apartment above; and, 5 W. Locust Street as retail parts sales on the first level and a one bedroom apartment above. Effective Date of Value: the effective date of the report is November 28, 2008, the date of death of the owner, Clyde Wrightstone. The effective date establishes the context for the value opinion. Date of Report: The date of the report indicates whether the perspective of the appraiser on the market or property use condition as of the effective date of the appraisal was prospective, current, or retrospective. Description (Scope) of the Appraisal Process: The scope of this appraisal encompasses the research and analysis of data required to prepare a reliable analysis of the subject property are as follows: 16 • The appraisal process included an interior and exterior inspections of the subject property by Karen Darney on January 9, 2009. Regional and neighborhood data was gathered from various sources, including public data sources such as the Cumberland County Planning Commission, Pennsylvania State Data Center, the Chamber of Commerce, and the United States Bureau of the Census. I analyzed specific neighborhood conditions through a neighborhood inspection. I have researched site data listed on the subject's tax assessment record, and the most recently recorded legal description. The site was observed. Entire land was not walked. Zoning information was obtained from Mechanicsburg Borough's web site. Flood Zone information was obtained from InterFlood. Current property tax assessment and mileage information was obtained from the Cumberland County Tax Assessment Office. Deed plats plotted by the Cumberland County Tax Mapping office. Ali site information gathered is reasonable and considered to accurate. Improvement data was obtained from an interior and exterior observation of the improvements. Your appraiser observed visible and readily accessible areas only. The appraiser is not required to disturb or move anything that obstructs access or visibility. Attics and craw! spaces were not inspected. Mechanicalslappliances were not tested. The inspection is not technically exhaustive. The inspection does not offer warranties or guarantees of any kind. Further information gathered was obtained from the Sue Witters, Executrix and her husband, County Tax Assessment records, and from in-house appraisal files. The Hiahest and Best analysis as though vacant and as improved was determined through analysis of uses that are legally permitted, physically possible, financiaNy feasible and maximally productive. The determination of the Highest and Best is a compilation of all relevant market conditions such as potential income, vacancy, the cost of construction and anticipated yield rates. In determining the Approaches to Value your appraiser collected data from public records, interviews with Tax Assessment officials, Township and/or Borough officials, buyers, sellers, real estate brokerslagents, andlor with other knowledge sources. In addition to the above-mentioned sources, data used is contained within my data bank from previous assignments andlor RSR Appraisers & Analysts data bank. A final reconciliation of value was determined based on my professional judgment of the available data. In this appraisal report, the Cost Approach, Income Approach and Sales Comparison Approach were considered to form an opinion of market value for the subject. A determination of approaches utilized are discussed in this report. This appraisal is to be used in whole and not in part. No part of this appraisal shall be used in conjunction with any other appraisal report. The current (effective date of appraisal) purchasing power of the dollar is the basis for the value opinion stated within; no extreme f{uctuations in economic cycles are anticipated. This Summary Appraisal Report is a recapitulation of the appraiser's data, analyses, and conclusions. Supporting documentation is retained in the appraiser's file. Competency of Appraiser: Karen Darney is a Pennsylvania Certified General Real Estate Appraiser and is competent to complete this appraisal assignment. Mrs. Darney has -the 17 i -~ knowledge, education and professional experience to competently complete the appraisal `- assignment in accordance with the Uniform Standards of Professions{ Appraisal Practice (USPAP), and supplemental standards deemed appropriate. Intended Use of Report: The intended use of this appraisal is to provide the intended userlclient with an opinion of the retrospective market value of the subject real property as of the effective date for estate settlement purposes and no other use is intended. Intended UserlClient: this appraisal was prepared at the direction of Richard C. Snelbaker, Esquire, (intended user/client). The information and opinions contained in this appraisal set forth the appraiser's best judgment in light of the information available at the time of the preparation of this report. Any use of this appraisal by any other person or entity, or any reliance or decisions based on this appraisal are the sole responsibility and at the sole risk of the third party. Your appraiser and RSR Appraisers & Analysts accept no responsibility for damages suffered by any third party as a result of reliance on or decisions made or actions taken based on this report. Property Rights Appraised: The property rights under appraisal in this report are the fee simple ownership in the subject property. Fee simple ownership is defined as "absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat."~ Definition of Market Value: Market value is the major focus of most real property appraisal assignments. Both economic and legal definitions of market value have been developed and refined. A current economic definition agreed upon by federal financial institutions in the United States is: "The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: i) buyer and seller are typically motivated; ii) both parties are well informed or well advised, and acting in what they consider their best interests; iii) a reasonable time is allowed for exposure in fhe open market; iv) payment is made in terms of cash in U.S. dollars ar in terms of financial arrangements comparable thereto; and v) 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.2 The definition of Market Value "is from regulations published by federal regulatory agencies pursuant to Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989 between July 5, 1990, and August 2A, 1990, by the Federal Reserve System (FRS), National Credit Union Administration (NCUA), Federal Deposit Insurance Corporation (FDIC), the Office of Thr'rft Supervision (OTS), and the Office of Comptrol{er of the Currency ~ The Appraisal of Real Estate, 12'" Edition, Chlwgo, 2001, The Appraisal Institute. ? Ibid., pg. 23. 18 _, _,., (OCC), This definition is also referenced in regulations jointly published by the OCC, OTS, FRS, and FDIC on June 7, 1994, and in the Interagency Appraise! and Evaluation Guidelines, dated October 27, 1994. Non Real Property: The Federal Reserve Board requires the appraiser to identify. and separately _~; value any personal property, fixtures, or intangible. items that are not real property but are included in the appraisal, and discuss the impact of their inclusion or exclusion on the estimate of market value. There are two ranges, two refrigerators and two clothes washers and clothes ~' dryers which are included in the estimated market value of the subject. -. ~', Hazardous Materials: in this appraisal assignment, the existence of potentially hazardous ~j material used in construction or the maintenance of the building, molds, or the gases found in the environment (such as the presence of urea formaldehyde foam insulation, toxic waste, andfor radon gas) which may or may not be present in the property, has not been considered. Your ~I appraiser is not qualified to detect such substances, The client is urged to retain an expert regarding these matters if deemed appropriate. The existence of underground storage tanks and their contents, which may or may not be present on the property, have not been considered. Your appraiser is not qualified to detect such substances. Should the client have a concern, an expert in this field should be contained. The buildings are of an age where lead based paint may 6e present. The market does not penalize the property, but the client should be advised of its possible existence. It is assumed that it is not present. If the client has a concern regarding this, then a qualified expert should be contacted. The buildings are of an age where asbestos covered pipes may be present. This is common for older buildings and should not affect marketability. if there is asbestos, it is recommended that it be encapsulated for environmental protection. Your appraiser is not an expert in this area. if the client has a concern regarding this, then a qualified expert should be contacted. No environmental impact study has been ordered or made. The appraised property is assumed to be in compliance with a!I applicable regulations unless otherwise noted in the report. The opinion of value is based upon no environmental contamination being present. Ownership History: The subject property was acquired by Clyde Wrightstone, Grantee, from Hazel Wrightstone, Grantee, by virtue of a deed dated December 14, 2005, and recorded in the Cumberland County Recorder of Deeds Office in Deed Book 272, Page 2047 for a reported consideration of $1.00. This was a transfer from wife as Grantor to husband individually as Grantee, for the purpose of vesting full ownership of the above Parcels in her husband. Prior transfer was on September 1, 1948, as recorded in Deed Book W13,. Page 546. The subject property is not currently listed for sale or under an agreement of sale. According to public records, the subject property has not changed hands since December, 2005. Exposure Time: Reasonable exposure time is one of a aeries of conditions in most market value definitions. Exposure time is always presumed to precede the effective date of the appraisal. Exposure time may be defined as: 19 --„ "The estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date _.~, of the appraisal; a retrospective opinion based on an analysis of past events assuming a competitive and open market." 3 The estimate may be expressed as a range and can be based on one or more of the following: j ~" 1. Statistical information about days on market; ~,.,__ 2. Information gathered through sales verffication; 3. Interviews with market participants. Based on the information presented in this report, a reasonable exposure time for the subject property is 6 to 18 months. ~w Marketing Period: the reasonable marketing time is an opinion of the amount of time it might take to sell a real or personal property interest at the concluded market value level during the period immediately after the effective date of an appraisal. Marketing time differs from exposure time, which is always presumed to precede the effective date of an appraisal. The estimate of marketing time uses some of the same data analyzed in the process of estimating reasonable exposure time as part of the appraisal process and is not intended to be a prediction of the date of sale. The estimate may be expressed as a range and can be based on one or more of the following: 1. Statistical information about days on market; 2. information gathered through safes verification; 3. interviews with market participants; and 4. Anticipated changes in market conditions. The estimated marketing time is a function of price, time, use, and anticipated market conditions, such as changes in the cost and availability of funds, and is not an isolated opinion of time atone. Considering the information presented and market activity, a reasonable estimate of marketing time, at the market value of the subject property, is 6 to 18 months. REGIONAL ANALYSIS The basic forces that motivate human beings within given market area have a direct impact on the area's real estate values. These are usually considered in four major categories: 1) social standards and ideas, 2) economic conditions, 3) government controls and standards and 4) environmental conditions. Below is an analysis in brief, which outlines the general economic condition and future trends of the subject area, Regional Overview "" The subject property is located within the Borough of Mechanicsburg, Cumberland County and is considered as part of the Capkal region of Pennsylvania. Cumberland County together With Dauphin and Perry Counties form the Harrisburg Metropolitan Statistical Area (MSA). 9 Appraisal Standards Board of Che Apraisal Fondatlon, "Statement on Appraisal Standards No.B: Reasonable Exposue Tlme in Real Property Market Value Opinions," Uniform Standards ofProfessional Appraise! Practice; 20D8-2o08 Edttion, pg. U-87.. ` 20 ^ 7 ~.-" ^ At the heart of the MSA is the City of Harrisburg, the Capitol of the Commonwealth of Pennsylvania, which is Located 70 miles from Allentown, 80 miles from Baltimore, 90 miles from Philadelphia, 110 miles from Washington D.C. and 200 mites from Pittsburgh. Interstate highway routes 76, 78, 81 and 83 run through the MSA and provide access to these markets. Transportation The major traffic arteries and highway system that run through the MSA provide important links to other primary and secondary markets in Pennsylvania and the northeast. Approximately 25% of the U.S. population lies within 250-mite radius of the Harrisburg area. Interstate 76, also known as the Pennsylvania Turnpike, links the area with Pittsburgh to the west and Philadelphia to the east. Interstate 78 runs from Interstate 81 in Lebanon County, eastward to Allentown and northern New Jersey, interstate 83 runs from Harrisburg to Baltimore, and Interstate 81 runs north to New York State and Canada, and south to Tennessee, Other major roads in the area include PA Route 283, which runs from Harrisburg to Lancaster, U.S. Routes 11 and 15, which run north to New York State and south to Maryland, and PA Route 581, which runs from Harrisburg westward to the Naval Ships Parts Control Center in Mechanicsburg. Both of these roads are four-lane limited access highways. A six-mile extension of Route 581 was compieted in 1996, joining the road with Interstate 81. Passenger rail service is provided by Amtrak on ConRail's main fine (formerly Penn Central and Reading Companies). The trainlrail terminal is {ocated in downtown Harrisburg at the renovated Harrisburg Transportation Center. Passenger rail service is available to Pittsburgh and points west, and to Philadelphia along ConRail's northeast corridor. Freight service throughout the area is provided by ConRail. Continental Trailways and Greyhound buses run out of a terminal located in the same facility. The Capital Area Transit (CAT} provides intercity bus service with routes throughout the East and West Shores. The bus system provides important transportation services for many city residents who work outside of Harrisburg proper. The area is also served by the Harrisburg International Airport (HiA), which is located 10 miles south of Harrisburg, along the Susquehanna River. The Capital City Airport located in New Cumberland and is utilized for smaller airplanes providing air taxi, local and transient general and military service. Population The historic population growth based on U.S. Census data and projections for the counties within the MSA are summarized in Table 1. 21 Table 1: Harrisburg MSA Population Growth, 1970-2010 ...,. _.,, 990 Dauphin 223,713 232,317 237,813 251,798 264,378 Gumbarland 158,177 179,823 195,257 213,674 249,813 Perry 28,615 35,718 41,172 43,602 52,785 Totals 410,055 447,660 474,242 509,074 566,976 Dauphin County is the most heavily populated county in the MSA, while Perry County has experienced the highest rate of growth. Cumberland County has also experienced a high rate of growth and is expected to see the greatest volume increase in population by tfie year 2010. Population growth rates are summarized in Table 2. Table 2: Harrisburg MSA Population Growth Rate, 1970-2010 COUNTY 1970-1960 1980-1990 1990-2000 2000-2010 Dauphin 3.85% 2.37°f° 5.9% 5.0% Cumberland 13.58% 8.T!)% 9.4% 16.9% Perry 24.82% 15.27°!0 10.0% 21.1 Totals 9.17% 5.93°/n 7.34% 11.37% Dauphin County included 50% of the MSA's total population in 9990, 49°1° of the MSA's total population in 2000 and is expected to include 47% of the population by the year 2010. Cumberland County is projected to include 44% of the total population in the year 2010, up from 41% in 1990. Perry County is projected to include 9.3% of the total population in the year 2010, up from 8.7% in 1990. Employment The Harrisburg MSA employment base is centered around state and federal government and those government-servicing industries. Located in the center of the Harrisburg MSA is the Pennsylvania State Capitol and over a dozen state office buildings. Military installations are also prominent in the area: 1) Mechanicsburg Naval Depot, a.k.a. Defense Distribution East; 2) New Cumberland Army Depot; 3) the U.S. Army War College in Garlisle; and, 4) Fort Indiantown Gap. Employment in the service sector is expected to be the dominant characteristic in the labor force during the next few years. Business, medical, health services, and other professional services have the greatest growth potential, followed by financial services and transportation. Local banking, real estate, and insurance companies have continued to consolidate in response to continued de-regulation in the banking industry. Evidence of this is the increased presence through acquisitions by larger institutions. However, these consolidations have also resulted in a demand for smaller banks oriented more toward the small business community and individuals. The Harrisburg area still has a large industrial base. its strength has shifted from manufacturing to warehousing, storage, and distribution. The region is a hub for the distribution of goods due to zz 1 - __ _. __, ~ -- its proximity to Philadelphia (90 miles), New York City (230 miles), Washington (110 miles), and Baltimore (80 miles), The major traffic arteries and highway system that run through the vicinity (Interstates 76, 81, 83, and U.S. Route 15) provide important links to other primary and secondary markets in Pennsylvania and the northeast. Trucking and transportation make up a strong industry for the area, with Harrisburg becoming a center for motor-carrier truck terminals, with approximately thirty terminals and seventy-five carriers. The area is also served by the Harrisburg International Airport, which has undergone substantial renovations in recent years. Organizations such as Capitol Region Economic Development Corporation (CREDO), Capitol Region Chamber of Commerce, Dauphin County Economic Development, and others have played a significant role in attracting new business to the region. With the aid of these organizations and the continued presence of the state government and the military, the Harrisburg MSA should continue to enjoy a stable economic base and growth. Major Employers The top 10 private sector employers in the area ranked by number of local employees are led by the Commonwealth of Pennsylvania, U.S. Government, The Hershey Company, Giant Food Stores, Penn State Milton S. Hershey Medical Center, Wellspan Health, Lancaster General, Wal- Mart Stores, Inc., Highmark Blue Shield and Tyco Electronics Corporation. Much of the Harrisburg area's large industrial base has shifted from manufacturing to warehousing, storage, and distribution. The region is a hub for the distribution of goods due to its proximity to the major metropolitan areas in the Mid-Atlantic area including Philadelphia, New York, Washington, and Baltimore. There are approximately 30 terminals and 75 carriers operating in the region. The growth related to these industries has provided economic strength to the area . Environment ~ Both natural and man-made environmental forces contribute to the character of an area. The Harrisburg region is surrounded by the Appalachian Mountains to the north and south. The Susquehanna River (the widest and one of the longest rivers in the East) flows through the heart of the area, separating the MSA into two distinct communities, the West Shore and the East Shore. The Susquehanna River provides the Harrisburg area with summer recreation and fishing. The Yellow Breeches creek, located in the area is a renowned fly-fishing attraction. Situated in the center of the Susquehanna River is City Island, a center of sporting and entertainment activities. Numerous rock concerts have been held on the island. City Island also contains Riverfront Stadium, home of the minor league AA baseball team, the Harrisburg Senators. The city is also the host of a professional outdoor soccer team, the Gity Islanders. The Hershey Bears, minor league hockey team of the Washington Capitals, provides spectator entertainment throughout the winter months. Ski Roundtop, a popular regional ski slope is located 30 minutes to the southwest of Harrisburg. Harrisburg and Hershey also provide cultural entertainment for its population. The Harrisburg Forum and Hershey Theaters host regular symphonies, ballets, off-Broadway shows, and musics{ 23 concerts. The Harrisburg area also has an active Arts community, receiving substantial support from private citizens. The Maine to Georgia Appalachian trial runs through the area providing recreational hiking. Much of Pennsy{vania's active deer hunting takes place in Perry County and on the numerous acres of State Game land within the Harrisburg MSA. Higher Education Higher education is offered through the Harrisburg Area Community College, the Temple University Center at Harrisburg, the Widener School of Law, Pennsylvania State University at Harrisburg, Messiah College, Lebanon Valley College, the Dixon University Center in Harrisburg (a consortium of State universities) and Dickinson College. Besides provided affordable post-high school education for the region, the colleges and universities also contribute substantially to the employment and economic base. Medical care in the Harrisburg region is offered at seven major hospitals, including the Penn State Milton S. Hershey Medical Center and Medical School (affiliated with Penn State University), the Harrisburg Hospital which is part of Pinnacle Health Systems, and the Holy Spirit Hospital. Harrisburg Regional Reai Eatate Market Empirical evidence in the local real estate market suggests that real estate investors in the Iota{ market are quite optimistic. We have noted substantial new development in the office and industrial markets, and since interest rates on 30-year mortgages remain at the 6% level and below, the residential market has continued to perform well. One previously under performing sector of note involved the retail centers. Vacancies created by the demise of anchors such as Ames, Wanamaker's, Montgomery Ward, Phar Mor and Hechinger's have been released and overall occupancy rates have significantly improved. This recovery has resulted in the attainment of stabilized occupancy levels throughout the region. Clearly the strongest location for retail space in the Harrisburg region remains in Lower Paxton Township along Route 22. Since the development of Colonial Commons in 1992, there has been significant development along this heavily traveled highway. Developments over the past include Paxton Towne Center, Dick's Sporting Goods (now at Colonial Commons), Media Piay, Circuit City, Gander Mountain, and Best Buy. In Cumberland County, the strongest retail locations are along the Carlisle Pike in Hampden and Silver Spring Townships. The most prominent new developments include the Kohl's department store at the former Silver Spring Drive-In site, and a strip center anchored by Giant on Route 114. Another 100,000 square foot shopping center anchored by Giant Foods was completed in summer 1999 in East Pennsboro Township along Center Street. Silver Springs Square is the newest shopping center on the Carlisle Pike with Wegmans, Target, Office Max, Kohl's, and Best Buy being some of the stores. This shopping canter is located just off of Route 11 and Lamb's Gap Road, near the Hampden and Silver Spring Township line. Harrisburg's N. 2nd Street and downtown has become a total entertainment center. With numerous restaurants concentrated on 2nd Street, Harrisburg is a designation for entertainment in the mid-state. Having shopping, business, entertainment, and great dining, the growth of downtown continues to build Harrisburg's reputation. , 24 • Financing Within the current environment, the real estate financing market has become increasingly competitive. Current financing terms available in the Harrisburg market for the various types of real estate are as follows: Cateaorv Interest Rate LTV Amortization Debt Coveraoe Commercial 6.5-7.825% 75-80°~ 15-20 years 1.20-1.40 Economic Outlook - With the unemployment rate lower than the state or U.S. as a whole and a stable population, the ~ Harrisburg MSA is outperforming the state's two largest metropolitan areas. Also, Harrisburg is located within two hundred and fifty miles of 25°!0 of the nation's population. Harrisburg has developed a reputation as a low-cost business location as more and more firms outsaurce business away from other high{y populated metropolitan areas in the northeast. The Harrisburg area appears poised for long-term growth and is expected to continue to be attractive to new businesses and new families. MECHANICSBURG BOROUGH: The Borough of Mechanicsburg is an older established community with a mixture of property types and uses, which is typical of this type of neighborhood. The borough is located seven miles west of the City of Harrisburg and is accessible on PA Route 114, from both U.S. Route 11 and interstate 81 to the north, and from U.S. Route 15 to the south. Interstate 81 is the major north-south highway between Canada and Tennessee, and U.S. Route 15 is a major route to Washington D. C. from the Central Pennsylvania area. Access from Camp Hill and the Greater West Shore area is generally from Simpson Ferry Road or Trindle Road (also known as Route 641). The Borough of Mechanicsburg is bounded on the north by Hampden and Silver Spring Townships, on the south and east by Upper Atlen and Lower Allen Townships, and on the southwest by Monroe Township. ~ According to the 2000 census data, the population of the Borough of Mechanicsburg decreased slightly from 9,452 persons in 1990 to 9,042 persons in 2000. The majority of the municipalities surrounding Mechanicsburg have shown significant growth . Below is a summary of the area population trends: Townsfiip 2000 1990 °1o Growth Silver Spring Township 10,592 8,369 26.6% Hampden Township 24,135 20,364 18.4% Upper Allen Township Lower Allen Township 15,338 17,437 13,347 15,254 14.9% 14.3% Monroe Township 5,530 5,468 1.1% N Cumberland County 213,674 195,257 9.4% Pennsylvania 12,281,054 11,881,643 3.4°!0 25 - - ^ The per capita income for the Borough of Mechanicsburg in 2000 was $22,812; compared with $31,728 for Silver Spring Township; $28,977 for Hampden Township; $24,127 for Upper Allen Township; $24,735 for Lower Allen Township; and $23,963 for Monroe Township. One of Mechanicsburg'sgceatest assets is its strategic location midway between Carlisle and Harrisburg. Many borough residents work for the State in Harrisburg, although the largest local employer is the U.S. Navy Ships Parts and Control Center located in Mechanicsburg. Main Street, also known as Route 641, is a major east-west roadway. Route 114 is a major north-south roadway. The Pennsylvania Turnpike, also known as Route 76; Route 11115; and I-81 are all within 1-5 mites of the center of the borough. Within the subject neighborhood, prices vary and depend upon the type of property and its existing use, A survey of property sales showed a range of values between a low of $50,000 and a high of $1;OOO,OOOt. Retail vacancy in the neighborhood is from 2% to 12%. Residential use prices range from $50,000 to $350,000+ depending upon the condition and area. Physically, the improvements in the area of the property are maintained in average condition. Schools, shopping, transportation, hoses of worship and public parks are all within walking or a short driving distance. Neighborhood values are expected to remain stable due to the convenient {ocation. The neighborhood life stage is considered to be stable, with the borough estimated to be 9g%+ developed, with limited vacant land available for new construction. Planning, zoning and restrictions for the area permit a mixed blend of uses which are compatible with the neighborhood. NEIGHBORHOOD ANALYSISlTRENDS: The subject property is located one block south in the heart of Mechanicsburg Borough, which is 7-8 miles west of the Central Business District of Harrisburg, the state capitol. Mechanicsburg is a small bedroom community. This neighborhood has a small town character and a variety of shops, restaurants, services, and office space. The upper floors of most downtown buildings are used as apartments, maintaining a residential atmosphere. Within view of the subject are commercialloffice, retail and residential uses. The "downtown" area has a variety of smaller owner occupied uses which are primarily office and neighborhood services. Some of the uses include: restaurants, professional offices, retail, and residential apartments. One of Mechanicsburg'sgceatest assets is its strategic location midway between Carfisie and Harrisburg. Many borough residents work for the State in Harrisburg, although the largest focal employer is the U.S. Navy Ships Parts and Control Center which is within a mile northeast of the subjecf. Main Street, aka Route 641, is a major east-west roadway and is located one block north of the subject. Route 114, aka S. Market Street is a major north-south roadway. The Pennsylvania Turnpike (Route 76), Routes 11 & 15, and i-81 are all within 1-5 miles. 26 The neighborhood life stage is considered to be stable, with the immediate area estimated to be 98% developed with no commercial land available for construction. Existing properties have been purchased and demolished for building sites. Planning, zoning, and restrictions for the area permit a mixed blend of uses which appear wmpatible to the neighborhood. Property qualifies for all types of financing, with mortgage money available through most lending institutions and the Cumberland County Industrial Authority. The neighborhood has traditionally enjoyed marketability, which is anticipated to continue. In analyzing the neighborhood, the following is considered: The Principle of Conformity holds that the maximum of value is realized when a reasonable degree of homogeneity, sociological as well as economic, is present. Thus, conformity in use is usually a highly desirable adjunct of real property since it creates and/or maintains maximum value. The Principle of Balance holds that value is created and maintained in proportion to the equilibrium attained in the amount and location of essential uses of real estate. The degree of value of a property is governed by the balance or apportionment of the four factors in production, which are labor, management, capital, and land or natural resources. The desirability of the location for the present use is determined by: 1. Proximity to amenities (shopping, churches, transportation, etc.) 2. The caliber of roads that serve the general and immediate area. 3. Police and fire protection. 4. Land use controls, zoning, and the general development trend. In analyzing the general area, consideration has been given to the following: 1. Source of Employment: The general Harrisburg market area enjoys a diversified economic base with stable employment. 2. Population Trends: The positive population trends within the general Harrisburg area have been toward steady upward growth. These trends generally follow employment trends. 3. Trend of Disposable income: As indicated by the demographics of the area, the disposable income has been increasing, a trend which is expected to continue. In analyzing the neighborhood for commercial use, the following rating analysis was considered: Road System: Good Accessibility: Average • Site identity: Average Neighborhood Trends: Positive Proximity to Amenities & Support Facilities: Average Balanced Land Use Pattern: Average Growth Trend: Stable 27 in regard to the subject property itself: Conformity to Existing Land Pattern: Average Architectural Styling & Exterior Finish: Average Front, Side & Rear Yard Setback: Average Landscaping: Minimal Parking Facilities: Minimal In summation, it can be said that the neighborhood is homogeneous in composition as to the type of uses. The road system adequately serves the neighborhood. Major employment centers are convenient. The overall proximity to amenities is a positive feature. The subject property conforms to the existing neighborhood. SITE DESCRIPTION The subject is made up of two tracts of lend, per the enclosed deed. Parcel No. 1 is the larger of the two and is located at the southwest corner of S. Market and W. Locust Streets. Ail of the buildings appear to be constructed on this parcel of land. Parcel No. 2 is a small square plot (35' x 41.05') located at the corner of W. Locust Street and Weaver Alley. This site has been paved and is uti{ized as a parking lot. The Tax Assessment office has combined both parcels into one site for taxing purposes. Based upon the Highest and Best Use, it is you appraiser's opinion tfiat both parcels should be combined to provide needed parking. Therefore, the combined parcels are described as one plot far appraisal purposes. Orientation: The subject site has a southwest corner (nt position at the intersection of S. Market Street and W. Locust Street. Frontage:. The subject site has 60.47 linear feet of frontage along the west side of S. Market Street and 148 linear feet of frontage along the south side of W. Locust Street. Lot Dimensions: 60.47' x 147.6' x 58.55' x 148', per enclosed deed. Shape: The subject site is somewhat rectangular in shape. ...Area: 8,792 +!- square feet or 0.202 acre, per enclosed deed plats. Tertain: Level at street grade Drainage: Appear adequate. AccessNisibility: Direct access from both S. Market Street and W. Locust Street. Buildings have average visibility from S. Market Street but limited visibility on W. Locust Street due to rear lot location. W. Locust Street is a one way street accessed from S. Market Street. Site improvements: Improved with two attached 2-story buildings fronting S. Market Street; and, - one detached 2-story building fronting W. Locust St. (See Building description(s) which follow). 28 Title: parcel l Date: 01-22-2009 ' Scale: finch = 25 feet File: Tract I : 0.169 Acres; 7355 Sq Feet; Closure = s70.0627e 0.64 Feet: Precision =I(643: Perimeter = 415 Peet 001=s72w 113 OD4=s19e 17.5 002=s19e 41.05 OD5=n72.30e 147.6 003=s72w 35 006=n18.30w 60.47 Title: Date: 01-22-2009 Scale: finch = 25 feet File: Tract 1: 0.033 Acres: 1437 Sq Feet: Closure = n00.0000e 0,00 Feet: Precision>l/999999: Perimeter = 152 Feet 001=s72w 35 003=n72e35' 002=s19e 41.05 004=n19w 41.05 ...-, L..1 ~, ~~.-- i ParkinglDrives: There is no on street parking provided directly in front of 100-102 S. Market s Street. On street parking is provided across the street. There is no on street parking on W. Locust Street. __ Paved on site parking for three cars is to rear of 102 S. Market Street. Paved driveway in rear of L 100 S. Market Street provides access to the rear of 102 S. Market. There is also a paved parking lot on the west side of 5 W. Locust Street for tour automobiles at the corner of W. Locust Street and Weaver Alley. ,~ Utilities: The utilities available to the subject site include public water, public sewage, electricity, telephone, and nature{ gas. Easements: Easements on the property include typical utility easements for pubiic water, sewer, natural gas, electric, telephone, etc. None of the existing easements appear to have an adverse effect on the property. No other easements or encroachments were indicated or observed. A title search has not been conducted, .and in considered to be beyond the scope of this appraisal assignment. Zoning: "C-N', Commercial- Neighborhood. Environmental Hazards: None known to exist. Flooding: According to FEMA Community Flood Map #4203620005D, dated March 3, 1992, the property is located in Zone X. This designation is explained as an area outside of the 100-year flood plain and typically requires no special flood hazard insurance. Landscaping: None. Typical for this area. Functional Adequacy: The site is rectangular in shape and is level at street grade. Site has sufficient frontage on two streets but size wilt limit use. No on street parking permitted in front of the subject on S. Market Street or on W. Locust Street, which will decrease market appeal. BUILDINGS ~ IMPROVEMENTS The subject site is improved with two 2-story attached buildings numbered 100-102 S. Market Street and a detached 2-story building number 5 W. Locust Street. The building at 100 S. Market is owner occupied, finished on the first {evel only and utilized as an electrical service office/parts sales office with storage on the second level. The building at 102 S. Market Street has retail on the first level and a two bedroom apartment on the second level. The building at 5 W. Locust Street has retaillwarehouse on the first level and a two bedroom apartment on the second level. Each are described as follows: 100 S. Market Street -Original building had a fire and was replaced in 1980, per tax card. This is a comer location and is utilized as an electrical service office/parts sales. Building contains 4,195 square feet with 2,083 square feet on the first level and 2,112 square feet of unfinished storage on the second level. Building has a brick front elevation and painted block exterior wails, rubber , roof, concrete block foundation, cement basement floor, concrete floors, metal truss, insulated 29 __ _.. .wn~e _~ _. _ Second Level 32.00' m BR g LR N, 2.00' c W $' BR Y 24.00' awcngba N^ Comments' Unfinished 2nd Level f Storage Area} First Level 3z.oo' Encl. Entry Storage ~.oo' 9.83' First Leveb $ ~ ~! '°' (Full BsmtJ First Levef ~ g 0 N O 2.00' ~, (Partial Bsmt.)~ s.oo' 3.50` <a 32.00' 6.00' 8.50' 12.00' °0 12.00' 102 S Market St. 100 S. Market St. Retal Use Retail Use AREA CALCULA'ilOiyS 511MMAR1' Code OeacrfpRion .'Net Sou .Net Totals (i8II1. Pisst Plooi' 2083.00 0 102 S Market 980.50 3063.5 68A2 100 S Market 2nd Lv 2112.00 102 S Market 2nd Lv 1000.00 3112.00 8/P Eanlosed Entry 47.25 47.25 OTN Stosaga 39.32 39.32 Net BUILDING Area (Rounded) 8178 BUttDJNG AREA BRF1{KDfJWN 9reekdown B~patals First Ploor 1.00 x 12.00 12.00 12.00 x 65.00 780.00 0.5 x 3.00 x 1.00 1.50 12.00 x 65.00 780.00 0.5 a 3.00 x 1.00 1.50 8.00 x 62.00 498. QO 1.00 x 12.00 12.00 102 B Market 0.5 a 3.00 x 3.00 4.50 0.5 x 3.00 x 3.00 4.50 9.50 x 13.00 123.50 6.00 Y 36.00 96.00 8.50 z 16.00 136.00 22.00 z 28.00 616.00 100 8 Market tad Lv 32.00 a 66.00 2112.00 102 B Market tad Lv 22.00 x 41.00 968.00 2.00 x 16.00- 32.00' 181tem6 (Rounded) 8778 rubber roof, emergency lighting, single phase 400 amp electrical service, one electric 30-gallon hot water heater, rear elevator shaft with removable elevatodliff servicing all three levels, and electric heat pump for first {evel only. The second unfinished level and the basement are unheated. Interior finish included asphalt the floors, suspended the ceilings with fluorescent lighting, vinyl fixed thermopane windows with wood single pane (at entry) front windows, and panel walls. Front entry to large open area used for reception and storage. There is a private office with carpet floor covering to rear of reception area, a half bath with toilet and wall hung sink. Two interior stairwells provide access to basement and second level, Unheated second level has cement floors and unfinished concrete block walls. There is an enclosed second level rear walkway to the second level apartment at 102 S. Market Street. This unit has been maintained and is in average condition. 102 S. Market Street -Attached 2-story building containing 1,980 square feet and constructed in 1950, per the tax card. There is 960+1- square feet of retail space on the first level and 1000 square feet on the second Level improved at a two bedroom apartment. Exterior is aluminum sided with a shingle roof on the front 2-story section and rubber on the remainder including the covered walkway and enclosed side porch. There is oil forced hot air heat, electric central air conditioning serving both levels, three separate electric meters (one for each unit and one hause meter). Second level has viny{ thermopane replacement windows throughout. Front first level entry into retail space with carpet floor covering, painted drywall and/or painted paneled walls, finished ceiling, fluorescent lighting, fixed aluminum thermopane front store front windows. Off this entry area are two partitioned dressing rooms and a half bath under the second level step area with wall hung sink, toilet, painted panel walls, carpeting, and suspended the ceiling. To the rear of the front retail area is another room with rear enclosed entry. This enclosed entry also provides access to the private office in 100 S. Market Street. There is a hallway on the south side of the building with storage area and steps to partial basement. Basement is located under the front room only and has a stone foundation, concrete floor with floor drain, There is an older oil forced hot air furnace and two electric hot water heaters (a 50-gallon and a 40 gallon hot water heater). There is no access to other crawl space areas under the first floor. ft is assumed for appraisal purposes that there are no adverse conditions present. Second level ~+partment has a front private walk-up entry in front of the building. This unit was owner occupied and is currently vacant. At top of steps is the eat-in kitchen with asphalt the floor, plastic wall paneling, wood cabinets, electric range, refrigerator and exhaust fanlhood. Step down from kitchen into the central living room which has wood floors and coat closet. Step up to front bedroom with wood floors. To rear of unit is a bedroom and a full bath. Bedroom has wood floor, suspended the ceiling, and closet. Full bathroom has plastic coated panel walls, suspended the ceiling, fiberglass tub(shower enclosure, vanity, and vinyl floor. Former porch on south side of this unit has been enclosed and has a stackable clothes washer/dryer. This enclosed porch extends in rear and provides access to second level of 100 S. Market Street. There is three parking spaces to the rear of 102 S. Market Street with access off of W. Locust Street. This unit has been maintained and is in average condition. 5 W. Locust Street - a detached two story building containing 2,393 square feet with an ,. attached garage containing 384 square feet. Constructed in 1950, per tax card, on slab, this unit 30 ~' 5 W. Locust Street n 2s.oo' 24.00' ~_ ~ o >a ~°' m Storage. Garage `o ~ i.. T VJ .... _.iu ... 24.00' Storage 28.00' 0 0 DA m KIT gR LR 0 0 cv tD .5 BA 25' Retail 0 0 4.25' ~ 20.50' First Level 0 0 28.00' Second Level NOTE: Interior Sketch"Not To Scale. nexmMrom~rv+ Comments ARE4 CAiCULAi'tONS •StfhAMARY eotle -Deaaiption Net&¢e Net Totals 6Hi11 'First Floor 1609.38 1609.38 GSA2 8®aond Floor 784.00 784.00 GAR Garage 394.00 394.00 Net BUILDING Area (Rounded) 2393 6UtLDtNf~ 'ARE'A BREAICUC9V~7N Braektlowa SOMOtels Fixtst Floor 28.00 X 53.50 1498.00 4.25 a 4.50 19.13 9.50 x 20.50 92.25 8ellOnd F1DOY as.oo x aa.oa 7e4.ao 4ltems (Rounded) 2393 ~ has a metal roof on the two story section and rubber roof on the one story sections, vinyl exterior siding, wood double hung thermopane windows, one oil forced hot air furnace and one central air conditioning unit serving both units, two electric hot water heaters (a 40 gallon and a 50 gallon), and two electric meters. First level is utilized as a parts/repair shop. Keyed entry into a small reception hall. There is a secretarial area, two private front offices, central storage room with cement floor, peg board, closet, partitioned toilet closet, and rear shop with open bay garage. In-rear is a partitioned storage area with separate electric currently utilized by the owner. Note: storage area locked and not observed by appraiser. Unit is in fair condition with limited finish. Carpet needs replaced. Second level apartment has a private walk-up entry to a sitting/dining area. There is a sma0 hallway off which is a kitchen and a hathroom. Full bathroom has an asphalt file floor, painted drywall walls and ceiling, toilet, wall hung sink, and fiberglass tub/shower. The kitcfien has ample wood cabinets, asphalt file floor, drywall wails and ceiling, electric range, hood, stainless steel double bows sink, refrigerator, stacked clothes washer and dryer, pantry and coat closet. Bedroom and living room have carpet floor covering. There is a floored walk-up attic for storage and a ventilation fan. There is a paved parking area for four cars on the corner of W. Locust Street and Weaver Alley. Attached garage has access off of Weaver Alley. The apartment has been well maintained and is in average to good condition. The first {evel ofFce/shop is dated and in average to fair condition. Compatibility with Surrounding Properties: Improvements are compatible with the surrounding properties. Most surrounding properties are of similar use, age and construction. Hazardous MateNals: None observed during inspection or known to exist. While a reasonable effort has been made by personal inspection and inquiry regarding the nature of current and previous occupancy, your appraiser is not professionally qualified to detect or verify the existence of hazardous substances. The client is cautioned that subsequent verification of the existence or hazardous substances may have an effect on the value of the property as estimated in this report. If there is a concern, the client is urged to retain an expert in this field. Americans with Disabilities Act (ADA): The subject improvements are not handicapped accessible. Restrooms, door widths, etc., are not equipped accommodate the disabled. Your appraiser is not expert in ADA requirements and has not made a specific compliance survey and analysis of the property to determine whether or not it is in conformity with the varic:~s detailed requirements of the ADA. It is possible that a compliance survey of the property, 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. Any substantial changes, which may be required, may make it necessary to revise the value conclusion in this report. Your appraiser reserves the right to review and update this valuation if any ADA upgrades to the property are necessary. Since the appraiser has no direct evidence relating to this issue, possible noncompliance with the requirements of ADA in estimating the value of the property has not been considered. 31 -- Codes and Regulations: Your appraiser assumes that all aspects of site and building - renovationlconstruction did comply with all laws, ordinances or regulations of all -, authorities having jurisdiction, whether borough, county, state or public utility. - I also assume compliance with all laws, ordinances, rules, codes and regulations, including those of the Department of Environmental Resources, Department of Public Welfare, Department of labor and Industry, the National Fire Protection - - Association, ASME, OSHA, SMACNA, ASHRAE, NEC, BOCA, and all public bodies (federal, state or local). ~-- Depreciation: _ Depreciation is loss in value due to any cause. It is the difference between the value of structural -- improvements or piece of equipment and its reproduction or replacement cost as of the date of _ T, valuation. Depreciation is divided into three categories: Phvsical depreciation: This is loss in value due to physical deterioration, such as normal wear and tear on the structure and component parts over time, and deferred maintenance. Physical depreciation due to age life and normal wear and tear over time. Functional Obsolescence: This is loss in value to some flaw in the ,structure, material, os design that diminishes its function, utility, and value in relation to current standards. It may be either a deficiency or an over-improvement. Use of replacement cost would preclude the need to deduct for functional obsolescence. The second story of 100 S. Market Street is utilized for storage. There is also an elevator in this building is atypical for properties which do not have rear parking. These items are considered atypical for the borough and are considered superadequate. Superadequacy is a greater quality or capacity in the structure than the prudent purchaser or owner would typically include or would pay for given this location. The full depreciated reproduction cost of these items cannot be recovered with resale. Since superadequacies do contribute some value to property, however, appropriate adjustments would be made in the Sales Comparison Analysis. Economic Obsolescence: This is Toss in value due to an impairment of its utility or salability due to negative influences outside the property. These are, by nature, incurable on the part of the property owner. No economic obsolescence present. LEASES A copy of two leases were given to your appraiser and have been included within the addendum of this report for the reader's edification. The property at 100 S. Market Street, the second level apartment at 102 S. Market Streat, and the small storage area in the rear of b W. Locust Street are owner occupied. - 32 • __ _~ A month to month gross lease was beginning on August 1, 2007, for the first level retail space - -" located at 102 S. Market Street. Rent is $600 per month with the tenant paying for electric, cable, ,,, telephone, snow removal (including sidewalks, steps, patios and decks), yard maintenance and - all repairslmaintenance under $25. No parking is provided for. A one year lease was entered into and began on August 1, 2008, for the second level apartment '"~ located at 5 W Locust Street. Rent is $550 per month with the tenant paying for electric, cable, ~--- telephone and minor maintenancelrepairs under $25. Parking is provided for one vehicle. No lease was provided far the officelshoo in the first level of 5 W Locust Street. Per the ~. executrix, the rent is $650 per month with the tenant paying electric only. -~ A summary of the income is as follows: 100 S. Market Street -Owner occupied - RetailJofFice 2083 sf Annual income s 2nd level storage 2112 sf I__- 102 S. Market Street - Retai{ store 980 sf @ $600Jmonth = $ 7,200 ~. ~ 102 S. Market - 2 BR apartment -Owner occupied --, 5 W. Locust - officelshop/garage - 1913"sf @ $650tmonth = 7,800 _ ~! 5 W. Locust - 2 BR apartment @ $550Jmonth = 6.600 Total Gross Income = $21,600 i 'Heated attached storage room estimated to be 8'x10' +i- and is utilized by owner. ZONING Property is located within the "C-N", Commercial-Neighborhood District. Sub}ect is a legal non- conforming use predating existing zoning. The Commercial-Neighborhood District is comprised of those areas in the Borough containing a variety of residential dwelling arrangements with low- intensity commercial uses. The purpose of this dis#rict is to promote a compatible combination of residential uses and retailtprofessional trade to establish a viable urban environment which will supplement activities and uses permitted in the Central Business District an Commercial-General District. Some of the permitted uses are: single-family and semi-detached dwellings; single-family attached dwellings; 2-family dwellings; apartment conversion; family care facilities; family and group day care homes; group care facilities; churches; libraries; medical centers; multi-family dwellings; no-impact home-based business; etc. Secondary Uses, aka commercial and office uses, may be permitted if determined suitable use in the Commercial-Neighborhood District utilizing the Standard industrial Classification Manual, 1972. Such uses are limited to location on the ground floor in a multi-story building. Each use shalt be located in a building occupied by a primary use and may not occupy more than 2000 square feet or 40% of the building space. Uses shall include: food stare, apparel stores, eating places without drive-in facilities, drug stores, used merchandise, miscellaneous 33 ~' _.n __ ~. _ r.~ shopping good stores, florists, cigar stores, newsstands, optical, insurance, real estate, coin- - operated laundries, besutylbarber shops, shoe repair, professional offices, etc. Building Height Limit: 40-feet Lot Area and Width: Lot area, width and coverage regulations shall be determined based on the primary use. See enclosed zoning regulations included in the addendum of this report. At (east 15°!0 of the lot area shall be maintained with a vegetative cover for residential uses. '~ For anon-residential use, the minimum lot standards shall be as follows: _ Lot area shall be based upon required setbacks, coverage, parking, loading/unloading and other applicable standards, but in no instance shad be less than 3000 square feet. _~ The maximum lot coverage for a nonresidential use shall not exceed 60°!° with at least 10% of the lot area maintained with a vegetative cover. . Yard Regulations: ,r Front Yard: The minimum front yard setback shall be determined by establishing the average setback distance of buildings constructed adjacent to each side of the lot to be developed. Side Yard: Corner lot: the side yard abutting a street or alley shall be not less than 15-feet. No side yard shall be required where structures abut on another, provided agreement with each property owner. Rear Yard: 15-feet Buffer yards/screening shall be provided. Non-conforming uses: Subject improvements currently do not meet existing set-backs, required lot coverage and parking requirements. If a nonconforming structure is damaged by fire, explosion, wind storm or other natural or criminal acts, it may be reconstructed and used for the same purposes, provided that the reconstruction andlor restoration of the building is commenced within one year from the date of occurcence and is completed without undue delay; and, the reconstructed building does not exceed the height, area, and volume of the original structure. ' If a nonconforming use of land or building ceases operations for a continuous period of more than • 18 months, then such use and any subsequent use of land or building shall conform to the provisions of ordinance. 34 , -~ ASSESSMENT AND TAXES umberlahd Coun CouMii Mlunicioal School """ Tote{ Mechanicsburg Boro 2008 Incl. library incl. Fire Mileage Rates: 0.002465 0.003 0.01373 0.019195 "'2008-2009 Face Value ssessmenf «zt«««« Taxes »»»»»»»> Total and: $64,33 $ 1,234.81 Im rovements: $2fi0,90 $ 5,007.98 ota(: $325,23 $ 6,242.79 Indicated Market Value: $ 325,230 Common Level Ratio for Cumberland County: 100% Value implied by Assessment: - $325,230 The common level ratio is established by the State Tax Equalization Board each year and is used as a measure of the relationship between the assessment and market value. The market value implied by the assessment is derived by dividing the assessed value for the subject property by the current Common Level Ratio. If the implied market value is substantially (usually at least 15%) higher than the market value estimated in this report, prudent management would seek an adjustment in the assessment. If the implied market value is substantially Power than the °market value estimated in this report, a review should be made of any additions andlor renovations which may have been made since the last assessment, which may prompt a reassessment if the property were sold, A note should be made that, white the application of the Common Level Ratio to the assessed value of the property creates a market value indication for tax purposes, it may not be reflective of the actual market conditions which exist at the current time period. Therefore, the indicated market value through application of the Common Level Ratio to the assessed property value is provided as information only and is not one confirmed or supported by your appraiser. HIGHEST AND BEST USE The highest and best use of property is that use to which the land can be put which will create the greatest utility for the land, be it in profit or in amenities, and that which is permitted or would be permitted by the local municipal or township authorities, and that which would not be unduly objectionable to the character of the surcounding property and keeping within the scope of the general neighborhood development. 35 -' Elements affecting value, which depend on events or a combination of occurrences, which, whiVe ..~ within the realm of possibility are not fairly shown to be reasonably probable, should be excluded from consideration. Also, if the intended use is dependent upon an uncertain act of another - person, the intention cannot be considered. ` Highest and best use is considered as that use of the {and, which may reasonably be expected to -, _. produce the highest and best return to the land, over a given period of time. Highest and best use is that {egal use which will yield to the {and the highest present value. It is sometimes referred to as "optimum use". In estimating highest and best use, there are essentially three states of analysis: A. Possible Use: Uses to which it is physically possible to put the site in question. B. Permissible Use: Legal uses permitted by zoning and deed restrictions on the site in question. C. Feasible Use: Possible and permissible uses that will produce the highest net return or highest present worth. The highest and best use of the land {site) if vacant and available for use may be different from the highest and best use of the improved property. This is normally true when the improvement is not an appropriate use and yet makes a contribution to the total property value in excess of the value of the site. The following test must be passed in determining the highest and best use: A: The use must be legal. B. The use must be probable, not speculative. C. There must be a profitable demand for such use and it must return to the land the highest net return for the longest period of time. The highest and best use of land as though vacant assumes that the site is vacant or can be made vacant by demolishing the existing improvements. The questions to be answered in the analys}s are: If the land is, were, vacant, what use should be made of it? What type of building or other improvement if any should be constructed on the land, and when? Legally Permissible: Property is located within the "C-N", Commercial-Neighborhood District. Subject is a le'gai non-conforming use predating existing zoning. the Commercial-Neighborhood District is comprised of those areas in the Borough containing a variety of residential dwelling arrangements with low-intensity commercial uses. The purpose of this district is to promote a compatible combination of residential uses and retaiVprofessional trade to establish a viable urban environment which will supplement activities and uses permitted in the Central Business District an Commercial-General District. ' Some of the permitted uses are: single-family and semi-detached dwellings; single-family attached dwellings; 2-family dwellings; apartment conversion; family care facilities; family and group day care homes; group care facilities; churches; libraries; medical centers; mufti-family dwellings; iio= 36 - - _ _ - ~_ impact home-based business; etc. Secondary Uses, aka commercial and office uses, may be permitted if determined suitable use in the Commercial-Neighborhood pistrict utilizing the Standard Industrial Class cation Manual, 1972. Such uses are limited to location on the ground floor in a multi-story building. Each use shall be located in a building occupied by a primary use and may not occupy more than 2000 square feet or 40°k of the building space. Uses shall include: food store, apparel stores, eating places without drive-in facilities, drug stores, used merchandise, miscellaneous shopping good stores, fbrists, cigar stores, newsstands, optical, insurance, real estate, coin-operated laundries, beauty7barber shops, shoe repair, professional offices, etc. There do not appear to be any deed restrictions preventing any speck use. Zoning constitutes the only legal restriction on the subject properly. Physically Possible: The shape, size, utility and terrain impose physical constraints on the types of possible uses. The subject is made up of two parcels: 1) the site fronting S. Market Street is irregular in shape and contains 7,355 square feet; 2) the parcel fronting W. Locust Street contains 1,437 square feet. This smaller parcel is unbuildable due to size. Therefore the smaller parcel would be combined with the larger site for maximum utility. Total combined site(s) area is 8,792 square feet or 0.202 acre. Total combined site is rectangular in shape, and is level at street grade. This corner location has 80.47 linear feet of frontage along the west side of S. Market Street and 148 linear feet of frontage along the south side of W. Locust Street. There do not appear to be any other apparent existing hazards on the site. All public utilities are available to the site. The site's physical characteristics lend themselves to a range of possible uses and the aspects of the site do not impose constraints on its development except for size. Financialiv Feasible: Uses that meet the above two criteria must also be capable of providing sufficient revenue to meet operation expenses, the required rate of return on investment, and the required rate of return on the site. There are no apparent impediments to the development of the subject property that would cause excessive development costs. Overall, construction costs, sustainable rents, and occupancy levels for commercial uses in this area indicate that development could be financially feasible. Maxfmaliv Productive: Site size would limit potential uses. Comer lot location is appealing but on street curb parking in front of the subject is not permitted, nor is parking permitted on W. Locust Street, which is a one way street. Parking is limited within the Borough and public parking lots are 2+ blocks away. Lack of parking and amount of visibility will decrease market appeal. Potential commercial use would be for a small service destination orientated business or office. Residential uses would also be considered. Considering the lack of parking and commercial competition, it is my opinion that a residential duplex use would obtain the maximum productivity. HIGHEST AND BEST USE AS IMPROVED: The highest and best use of the property as improved pertains to the use that should be made of an improved property in light of its improvements. It is the use that maximizes an investment property's value, wnsistent with the long-tens rate of retum and associated risk. The subject site is improved with multiple buildings and utilized as an owner occupied commercial office/parts sales; a retail shop with an apartment above; and, a shoplstorage with an apartment above. The current improvements are a legal nonconforming use predating current zoning. The second level of 100 S. Market Street is unimproved and utilized for storage. Cun'ent zoninig would not permit this area to be improved due to tack of parking. The current improvements conform to neighboring uses and have been well maintained. Taking all into consideration, it is my opinion, 37 --- - - -- • .~ that the highest and best use as improved is to correct any deferred maintenance and continue as improved. VALUATION PROCESS The appraisal report describes the appraisal process. To the extent that some data is not in the report, it is retained in the appraisers' files. The purpose of this appraisal is to provide an opinion of the market value of the Fee Simple title to the subject property in general, the appraisal proceeds from an analysis of the area, site, and improvements to the actual valuation. The basis far the valuation process is the highest and best use of the property, which may or may not coincide with the property as improved. The highest and best use represents the most profitable of the possible, permitted and feasible uses. The goal of the valuation process is a well documented and supported value conclusion that reflects the appraisers' study of all factors that influence the market value of the property being appraised. In order to do this, the appraiser usually studies a property from three different viewpoints, which are typically known as the three approaches to value. They are as follow: 1. The Cost Approach -whereby the current cost of reproducing or replacing the improvements, less the loss in value from depreciation (generally physical} due to normal wear and tear, equals a depreciated cost of improvements. The value of the land is added to arrive at an indication of value. The Cost Approach looks at value in relation to the cost to replace N with equal utility. The Cost Approach was not used due to the age of the improvements. 2. The Sales Comparison Approach -whereby the subject property is compared to other recent sales of comparable properties to arrive at an indication of value. 3. The Income Capitalization Approach -looks at the earning power of the subject property, i.e. its income or anticipated future benefits, and capitalizes this into an indication of value. The Income Approach values property from the point of view of an investor. Information for the application of the three approaches to value is obtained from the market through research verification and analysis. It should be noted that, although the approaches are interrelated, separate indications of property value are usually derived from each approach. The reconciliation of these three approaches involves an attempt to explain the apparent differences and to determine which approach, or combination of approaches, should be given the greatest weight. The approaches to value will be considered in the following section of this report. MARKET ANALYSIS AND SPECIAL CONSIDERATION In the valuation process, market factors which relate directly to the marketability of the subject property were considered and included the following: 1. The current supply of new and used space of equal or superior quality, which „, is currently available in the Greater Harrisburg area. 2. Rent concessions, which are currently available in competing space presently for lease. 3. The availability of vacant sites, which would permit construction of new facilities. 38 -- ._,. INCOME CAPITALIZATION APPROACH . ~,.. u._ The Income Capitalization Approach is based upon the premise that an investor who purchases income producing real estate is essentially trading present dollars for the right to receive future _-~ income. This is the Principle of Anticipation. The Principle of Supply and Demand is a{so fundamental to this approach in that changes in supply and demand wilt haven an effect on `"° market rents. The Principle of Substitution holds that market rents and capftalization rates tend to ,,, be set by prevailing rates and rents at equally desirable substitute properties. Forces outside of he property wilt also have an affect upon the income attainable at the property. The state of the --- economy, political environment, crime rates, and new development are just a few of the outside factors, which may influence rents and rates. This is the Principle of Externalities. ~~ -. In general, the Income Capitalization Approach involves the estimation of net operating income. This net operating income is then capitalised at an appropriate rate based upon that particular property's risk and return profile. First to be estimated in the income approach is the effective gross income (E.G.I.). This is defined as the anticipated income from elf operations of the real estate after allowance for vacancy and credit loss. As unencumbered, it would be based upon the economic rent, i.e, the rental income that a property would most probably command on the open market. If appraised as encumbered, it would reflect the contract rent or the payment for the use of the property as designated by lease. The unit of comparison that the appraiser will develop for the subject property is the rental rate per square foot. Secondly, the net. operating income (N.O.I.) is estimated. This is the annual net income remaining after deducting all fixed and operating expenses but before deducting financial charges such as recapture or debt service. Third{y, a capitalization, or overall rate, is estimated. The relationship among the quality and quantity of the income stream, risk, and time, is the process of capitalization. The capitalization rate will be based on the actions of investors researched in the marketplace, representing the current rate necessary to attract capital. There are many methods of developing capitalization rates. Two of the most common include direct capitalization and yield capitalization. Direct capitalization requires market-derived capitalization rates from similar properties and transactions and then applies them to the subject property without explicit.attention to return on and return of capital. Yield capitalization is more complex and requires~jnterpreting expectations and attitudes into formulas designed to convert various income streams into present value. Finally, the incor~ne approach estimate is calculated by the division of the N.O.I, by the capitalization rate. In the valuation of the subject property by the Income Approach, the fee simple value was estimated through direct capitalization. 39 -- - - GENERAL MARKET COND{TIONS AND TRENDS: According to the Central Penn Business Journal, February 6, 2049, "the commercial real estate business hell off last year in Central Pennsylvania by the third quarter. When it will bottom out is anyone's guess, the commercial agents say. Sales and leasing properties is slow due to the economy and increased unemployment. Office leasing is stagnant for the past year. Residential apartment lease up have been doing well, but higher vacancy rates and credit losses are anticipated due to higher unemployment. Retail is not doing welt also due to the economy and lack of consumer confidence, Vacancy rates are approached double-digit figures in every midstate commercial market last year, including retail, office and industrial sectors. More vacant space opened in the industrial market than any other market, according to the 2009 NAI CIR Global Market Report. NAl CIR Commercial Real estate tnc. is an international real estate firm with a regional office in Wormteysburg, Cumberland County. Last year Central Pennsylvania had an industrial vacancy rate of 16.3 percent. In 2007, the rate was 9 percent, according to the 2008 report. The midstate industrial market was strong last year due to the region's location among major cities including New York, Baltimore, Washington D.C., and its proximity to Interstates 18 and 83 and major trucking routes. But an over build took place with 6 million square feet added in the past year. Inventory outpaced demand. Retail had a higher vacancy rate in the Harrisburg, York and Lebanon market than it did in the Lancaster area. The vacancy rate for Harrisburg, York and Lebanon markets was approximately 12 percent in 2008. It was about 4 percent in the Lancaster areas. In 2007, the Harrisburg, York, and Lebanon retail markets had a vacancy rate of approximately 5 percent and Lancaster's was about 3.3 percent. Vacancies in the office sector remained even in the Harrisburg market area. The office vacancy rate throughout the Harrisburg, York and Lebanon area markets stayed at about 6 percent last year. The previous year, it was about 5.7 percent according to the 2008 report. When the market will hit the ground is anybody's guess, regional brokers said. As more companies lay off workers, there is a sense that things will get worse before they get better. The uncertainty is driving customers to make tough choices. Businesses are moving into smaller spaces or closing shop. There are many business owners sitting on the sidelines. When people vacate space to go smaller or close shop, a rash of properties goes on the market at reduced rates. And there are many commercial real estate opportunities to be had. Most property owners would rather make 90 cents on the dollar than make nothing, so they are willing to lease for a lower price. Last year, the average lease price for newly constructed downtown office space in local urban areas was $22 per square foot. In 2407, it was $22.50 per square foot. Office space is described by commercial real estate agents as different classes. There is class-A, class-Band class-C. Class-A is the highest quality of space, class-B is a step down and class-C is typically the older quality space. Most commercial brokers do not market class-C space. This is a historic summary of vacancy rates:"~ a Central Penn Business Journal, February 6 2009, page 3. 40 =- ~,,. ~,. Combined Harrisbura. Lebanon and York Markets - Class-A 4 percent 3.8 percent Class-B 12 percent 11.3 percent Suburban vacancv rates 2007 2008 Class-A 8 percent 4 percent Class-B 12 percent 14,4 percent SOURCES: 2008 and 2009 NAI CIR Global Market Reports In summary, the national economy is a major concern and no one knows when it will stabilize. Consumer confidence is eroding and the housing market is suffering from higher unemployment. Retail renters are looking for rent concessions.. Apartment owners are looking at flat lease rents, higher collection losses and difficulty in finding credit worthy renters. Cap rates have risen and values have declined in all asset classes of real estate. Lenders have increased qualifications for loans and obtaining money is more difficult. With the exception of cash transactions, investment activity in commercial real estate sectors is Hearty at a standstill because commercial lending has essentially halted. Job loses are curtailing the demand for space, according to the latest National Association of Realtors, The office rent is likely to contract as erosion in the job market curtails demand for space. Vacancy rates are projected to increase to 16+ percent in the third quarter of 2009 from 13+ percent in the third quarter of 2008. Declines in consumer spending are impacting the retail sector. Locally, retail activity has slowed dramatically in the second half of 2008 across all product types as the credit crunch and weak consumer spending slowed expansion plans of most retailers. Retail rents are trending lower as vacancy rates trending higher for all retail property types. Owners are offering new tenants free rent. Lower rental rates and other inducements at the same time existing tenants are seeking rent reductions. The warehouse markets are bleak. The national warehouse market continues to see supply pull ahead of demand as the U.S. economy contracts, Employment losses, increases in the supply of suburban office space and a decline in leasing activity are jointly weakening the office market. Demand for space is expected to continue to weaken and apply downward pressure on lease rates. The apartment market is reacting to its greatest demand generator -employment. As unemployment rates increase, so does vacancy rates. Although change is occurring, the Harrisburg market area is doing better than the national picture. 41 MARKET RENT: To arrive at the rental income that this property would most probably command on the open market, a comparison is made of the most current rental rates being paid for comparable space. NOTE: Due to the confidential nature of commercial leases and at the request of commercial brokers and property managers in this area, your appraiser has not disclosed the details of those leases analyzed. The reason for this is that competitor leasing brokers have been using this information to take tenants from these properties and place them in their own listings. information obtained andlor provided for this appraisal was permitted with confidential restrictions, Detailed information has been maintained in your appraiser's files. A survey of the market was done for comparable size/quality of the various space(s). Uses included general commercial uses, as well as, residential apartments and warehouse/storage. From this survey comparable rentals have been selected for use in this analysis to help estimated the current rent potential for the subject. Following is a brief summary of this survey: Commercial Leases: 1) A three year gross least was entered into in September, 2006, for 850 square feet of space located in the first block of E. Main Street, Mechanicsburg, PA. Rent is fixed at $800 per month which equates to $11.29 per square foot. Tenant pays all expenses except for taxes and insurance. There are two options to renew for an additional two terms of three years each. Space is.superior to subject having on street parking and located on the dominate business street. 2) A three year gross lease was entered into in July, 2007, for 1,200 square feet of professional office space located on W. A11en Street, Mechanicsburg, PA. Rent is fixed at $1,375 per month which equates to $13.75 per square foot. There are two 3-year options to renew. Tenant pays for telephone and janitorial only. Amenities include seven parking spaces, on street parking, and newly renovated space. 3) A hold over gross lease located on the Carf+sle Pike, Mechanicsburg, PA is currently on a month to month basis. Rent is $662.65 per month or $9.64 per square foot for 825 square feet of lower level office space. Tenant pays for in-suite janitorial only. This is a multi- tenant office building with ample common parking. 4) An renewal gross lease located on E. Trindie Road, Mechanicsburg, PA .Original lease was entered into in August, 2006, and tenant took an option to renew for an additional two years. This is a detached ranch conversion containing 1,065 square feet. Property is utilized as an insurance office and rent is $B50 per month which equates to $9,58 per square foot. The tenant pays for all utilities and the owner pays for water, sewer, trash and snow removal and lawn care. Ample parking is available. Property has superior quality of finish, superior location and superior parking. 42 ,_,, ,^-s Current Active Commercial Leases: `~ The property located at 18-20 S Market Street, Mechanicsburg, PA is currently being marketed by ,,,,~ Crossroads Property Management, Inc. Asking rent is $650 per month OR $11.14 per sq.ft.. This is a store front containing 700 square feet with a wall air conditioning unit and three parking spaces. Tenant to pay electric. Owner pays heat, hot water, trash, sewer, water, taxes and insurance, Unit has new watt to watt carpeting, fresh paint and consists of three moms and one bathroom. Location is comparable to the subject. No on street parking permitted in front of the property. Retail/office space located at 420 Market Street, Lemoyne, PA is currently being marketed by NAIlCIR with an asking net rent of $9.50 per square foot. This is 1,085 square feet of open floor plan with two private restrooms. This masonry building was constructed in 1942 with full basement, gas fired baseboard heat and electric centre{ air conditioning, drywall walls, carpet floor covering, lighted pole sign, and use of 25 on-site parking spaces. Tenant to pay electric, heat, and pro-rata share of expenses. Adjusting for smaller size, as compared to 100 5. Market Street, (-5%) and superior parking (-10°l0), the adjusted net rent would equate to $8.06 per square foot. Rental comparables with similar locations and Limited parking were not available: The above unadjusted gross leases range from $9.58 to $13.75 per square foot. The higher rental rates reflect superior quality of finish and superior locations with ample parking. The property located at 19-20 S. Market Street, Mechanicsburg, PA is currently being marketed at $650 per month. This property is most similar to 102 N. Market St. has a contract rent of $600 per month or $7.35 per square foot. Considering the lack of parking and size, subject's unit appears to be obtaining market rent. The first level of 100 S. Market is currently owner occupied. This unit is utilized for electrical part sates, storage and limited office use. Adjusting for larger size and lack of parking, it is my opinion that the space is inferior to all comparables. Therefore a net rent of $8.00 per r square foot was considered reasonable. Warehouseltis~ht industrial teases: 1) A one year net lease was entered into in June, 2008, for 4,800 square feet of heated warehouse space located on Plum Alley, Lemoyne, PA. site is located -next to I-83 and rent is $3.75 per square foot. Space is equally divided into two. One bay has 8.5 & 6.5 ceilings with two drive-in doors; and, one bay has 10,5 foot ceiling height with two drive-in doors. Plum Alley permits only a straight truck access. Six parking spaces provided. Space has superior parking. 2) A 4,741 square foot warehouse in New Cumberland Borough is leased for $3.75 per square foot. Space has 9-foot ceiling height and public utilities with gas heat. Rent inc{udes taxes and insurance. Lot is 1.43 acres. Space is superior due to parking. Current Active Warehouse Lease: Sopensky Properties is marketing warehouse space in Mechanicsburg Borough. Two garages are being offered: one contains 3000 square feet heated space wkh 1 D-foot auto door and located at 101 E. Main Street rear. Asking rent is $695 per month or $2.78 per square foot. There is also 800 square feet of heated space at 103 E. Main Street also with a 10-foot auto door at 103 E. Main Street. Asking rent is $225 per month or $3.38 per square foot. Both of these support the estimated rent. - 43 5ubject's contract rent for 5 W. Locust Street is $650 per month for a total of 1,193 square feet which equates to $4.85 per square foot with the tenant paying for electric. Rentals of similar sized warehouses in similar condition ahd in similar locations as the subject were limited for most are owner occupied in the borough. The comparables are leasing for $3.75 per square foot and have superior parking and are leased on a net basis. Two active listings are being marketed for $2.78 to $3.38 per square foot but lack comparable office space. Taking into consideration subject's differences, the current contract rent is considered reasonable. The second level of 100 5. Market Street is unfinished, unheated storage space consisting of 2,112 square feet. pue to location and limited access this space would have limited utility. A rent of $2.50 was considered reasonable for this storage area. Apartrnent Rents: Apartment rental rates for units located above commercial uses were obtained. The following are alt located in Mechanicsburg Borough and all are under a one year lease. 1) A two bedroom apartment located at 402 E. Main Street is leased for $680 per month. Unit contains two bedrooms, two bath rooms, {iving room, and kitchen, which is equipped with all appliances including a clothes washer and clothes dryer. Unit has central air conditioning. Tenant pays electric, hot water heat, water, sewer and trash. Owner pays for taxes and insurance. Unit is superior due to having a second bathroom. 2) A first level apartment located at 106 N. Market Street is leased for $545 per month. This is a one bedroom, one bathroom unit with living room and kitchen. A refrigerator and range are the only appliances included. Tenant pays for gas heat, water, sewer and electric. Owner pays for taxes, insurance, sewer and trash. Unit is inferior for having only one bedroom; but, tenant pays for heat. 3) A first floor unit located at 414 S. Market Street is leased for $525 per month. This is a two bedroom, one bathroom, unit in a four unit building. Property manager stated this unit rents very fast. Unit includes refrigerator and range. There is a coin operated clothes washer and dryer in the building for tenant use. Tenant pays for electric and electric heat. Owner pays for taxes, insurance, water and sewer. 4) A unit located at 120 W. Main Street is leased for $600 per month. This is a two bedroom, one bathroom, apartment in an eight unit building. Owner pays for gas heat, trash, water, sewer, taxes and insurance. There is off street parking and building is located in a commercial zone. 5) An apartment located at 71-73 W. Main Street is leased for $495 per month. This is a two bedroom, one batq unit with commercial use below. Owner pays for water, sewer, trash, electric, taxes and insurance. Tenant pays for gas. Appliances include range and refrigerator. 6) A unit located at 310 E. Main Street is leased for $650 per month. This is a two bedroom, one bath apartment located on the second floor. Brick residential unit located in the historical district with four parking spaces in rear; plus, unmetered on-street parking. Owner pays for oil heat, water, sewer, trash, taxes and insurance. Tenant pays for electric. Unit located in superior residential district.. 44 Six apartment comparables have a range of rents as follows: Comparable Bedrooms Bathrooms Amenities Tenant Pavs Rent 1) 2 2 W/D & AC Heat $680 2) 1 1 --- Heat $545 3) 2 1 -- Heat $525 4) 2 1 --- -- $fi00 5) 2 1 - Heat $495 6) 2 1 --- --- $650 The market rents range from $680 to $495. Only two r®ntals where found where the owner pays the heat. These rents were for $$600 and $650 per month. Subject's unit located at 5 W. Locust Street currently is obtaining $550 per month. Based on the above market rents, the subject current contract rent is below the market due to owner paying heat costs. The comparables indicate rent with heat included are leased at $600 to $650 per month. Both of subject's units include a clothes washer and clothes dryer which is appealing. Therefore, it is my opinion that subject's two apartments would lease for $650 per month. Estimated Gross Potential Income is calculated as follows: 100 S. Market S 1st level commercia12,083 sq.ft. @ $8,00lsf = $16,664 2"° level storage 2,112 sq.ft. ~ $2.50lsf = $ 5,280 102 S. Market St. 1" level commercial @$600/mo. _ $ .7,200 2"tl level 2-BR apartment @ $650/mo. _ $ 7,800 5 W. Locust St.: 1°~ level warehouse @ $650/mo. _ $ 7,800 2ntl level 2-BR apartment @ $650/mo. = 7 800 Total Estimated Gross Potential Income: _ $52,544 VACANCY RATE(S): Your appraiser survey commercial brokers and reviewed published market statistics provided by NAR -Commercial Real Estate Outlook. The retail vacancy ranges from 9.8% to 12.7%. Average retail rent is expected to contract 2% in 2008 and fall another 7.3% in 2009 due to rising unemployment, overall weakening of the economy, and weak consumer spending. Demand for space has decreased in ail asset classes. Supply growth. has been kept in check by cost of development and lack of capital. Transaction volume has dropped. Lenders have become more stringent on terms and conditions for loans. Ranters are looking for rent concessions. The average vacancy rate for retail is about 11.5°!°. The light industrial sector has been holding up fairly well but the economic slowdown will take its toll. Vacancy rates average around 10% in the third quarter of 2008. The apartmenYvacancy rate 45 typically reacts to its greatest demand generator -employment. Although national unemployment rates are increasing, the local market is fairly stable. As loca{ unemployment increases, the number of qualified renters will decrease and rental rates will stabilize. Taking into consideration subject's location, lack of parking and use, a rate of 15°1o was utilized for the retail space. The unfinished, unheated storage space above 100 S. Market Street has little utility due to access. A vacancy rate of 20°1° was utilized for this space. The fight industrial shop would have some demand due to low rental cost. A rate of 5% was utilized. A vacancy rate of 4% was utilized for the apartments, which have had long term tenants. History of Expenses: Your Fixed: Taxes: Insurance: Ooeratino: 100 S. Market: Water: Sewer 102 S. Market 5 W. Locust appraiser was supplied with the following annual expense history $.6,153.48 $1,358.61 $ 106.17 $ 293.00 Water SeweNTrash Electric Water SewedTrash Electric Oil for 5 W. Locust & 102 S. Mkt. Total Expenses: COMMENTS ON EXPENSES: $ 139.72 $ 617.70 $ 401.00 $ 241.63 $ 581.00 $1,536.46 848.00 $16,276.97 Your appraiser projected the typical or "stabilized" annual cash expenses forecast to be payable by the owner of the property. The operating expenses are the annual expenses or annual cash outflows borne by the owner-investor of the income-producing property as the necessary cost of generating the gross income(s) it is forecast to be capable of producing. They represent what the owner of the type of property being appraised pays for according to custom, the lease or market stand9rds. The fixed expenses include real estate taxes and insurance. The actual taxes were calculated and utilized in this report. The insurance cost reflects a renewal cost as of June, 2008. It was considered reasonable and utilized in this report. However, based on the Sales Approach to value, the subject property appears to be over assessed. Therefore, a second Income Approach was done to show the effect of tax implication. The overall capitalization rate was adjusted by adding the tax~rate, rendering an adjusted overall capitalization rate applicable for stabilized net income before taxes. The assessed value is the county's estimated market value. The common level ratio is 82%. The overall effect of the excessive taxes is reflected within the Stabilized .Operating Statement presented on the following pages. - 46 100 S. Market Street -this is owner occupied space. The tenant typically would 4ease this spate for operatng expenses. II operating expenses. The estimated rent is based on the tenant payih9 102 S. Market Street and 5 W. Locust Street -these are multi-use properties with commercial. uses on the first level and residential apartments above. Due to the nature of the buik~ing(s) the market indicates that the owner would typically pay for fixed expenses and operating expens such as water, sewer, and heat. The owner is paying for heat due to the un-separated centraj s heating and cooling system(s). The tenants in 102 S. Market Street and 5 W. Locust Street pay for their electric use. There are three electric meters serving 102 S. Market Street. The market indicates that the tenants would typically pay for individual electric use and the owner paying for air conditioning electric use. There are two electric meters serving 5 W. Locust Street but the owner pays for the electric for the central air conditioner which serves both units. There is one furnace in each of the buildings (102 S. Market and 5 W. Locust Streetsl serving all were tilized int'this reportes appear reasonable considering the age of the units. Actual expenses Water and sewer costs depend upon the amount used. The costs supplied appear reasonable and were utilized. Trash also is considered reasonable. The commercial tenants would contract for dumpster use and pay for their use. There is no yard maintenance. Snow removal is provided by the commercial tenants, per leases, No maintenance costs were supplied. Expenses commonly found with commercial buildings were added to the projected expense statement, which includes a management fee and a reserve for replacements. Manaoement and Leasinn Fees: This is necessary expense incurred through the management of the property. The expense is not included in the owner's tax returns as they are presently managing the property themselves. However, it is necessary to include this in the Income Approach. Conversations with local real estate brokers and professionals and owners o similar properties indicate. that this item is generally calculated as 3% to 10% of the effective f gross income of the property. This expense was estimated at 3% of the effective gross income, Reserve for Reolacement of Fixed Assets: It is the responsibility of the landlord to provide for the structural integrity and major mechanical components of the property in order to ensure continued rental of the subject over time. Therefore, it is necessary to anticipate a long term maintenance reserve for the replacement of such items as the roof, parking lot, plumbing fixtures appliances in apartments and HVAC. These items have not been taken into account in the maintenance and repair category. 4) _,~. ~,:~ _ To estimate the long term replacement preserve, replacement costs for each of these items is anticipated by using the Marshall and Swift Cost Service for the subject.. Each of the various ,-,,., items estimated replacement costs was divided by its useful life. The sinking fund factor was __ applied to estimate replacement cost to anticipate an annual reserve amount necessary. When - applying this sinking fund factor, it is anticipated that the annual reserve amounts will be placed ~~ into an interest-bearing account to provide the necessary funds forreplacement of the items as required. Based on this analysis, an annual reserve amount of $2,994 is anticipated, which has been rounded to $3,000. The following chart provides the details of this analysis: Annual Total Useful Sinking Res: Fund ITEM # Units $ /Units Cost Life (Yrs} Factor Amount Flooring 5247 $1.90 $9,969 10 0.083291 $83p .35 Roof Covering (Metal) 784 $2 $1,568 30 0.01783 $27 .96 Roof Covering (Shingle) 384 $1.90 $730 30 0.01783 $13 .01 Roof Covering (Rubber) 4015 $2.00 $8,030 30 0.01783 $143 .17 Hot Water Heater 5 $500 $2,500 11 0.074149 $185 .37 Plumbing Fixtures 14 $50 $700 20 0.033582 $23. 51 Heat Pumps 1 $2,500 $2,500 12 0.066552 $166 .38 FHA Furncaces 2 $3,500 $7,000 25 0.02401 $168. 07 Air Conditioning Units 2 $3,000 $6,000 12 0:066552 $399. 31 Appliances 6 $1,000 $6,000 10 0.083291 $499. 75 Parking Lot 1800 $2.75 $4 950 8 0.10853 $537. 22 $2,994. 11 * Heating based on 1/3rd of total repl acement cost to reflect only mechanical components ** Sinking fund factor based on 4°1o annual rate A reconstructed income and expense statement for the subject property is shown on the following page: 48 STABILIZED OPERATING STATEMENT Cn C~ !lIC~ !~ CommerciaVRetail 2083 $8.00 $18,684 Commercial/Retail ~ $800/mo. 980 $7,200 Total $23.884 Shop/Light Intluatrial ~ $650/mo. 1993 $7,800 Unheated Storage 2nd Level 2112 $2.50 $5,280 Total $13,080 2 8R arlmems x2 850/mo 1784 15800 Total .Ft. & Gross Income 8952 52 544 Leas Vacan & Colecion loss Commercial 15°~ $3 580 Leas Vacen & Collection Loss Industrial 5°~ 3g0 Less Vacancy & Collection Loss (Storage) 20°h 1 058 Less Vacanq & Colecian Loas (Apartments) 4°k 824 Commercial Effective Gross Income $20,Y84 Industrial EffecBve Gross Income $7,410 Storage Eftective Grows Income $4.224 Apartments Effective Gross Income $14,978 Total Effective Oros Income $48,gg4 O ratln E nses % of Effective $$ /sf Total Reserve For Replacement 6,40°~ $0.34 $3000 Real Estate Taxes 13.31 % $0.70 $6243 Insurance 2.90% $0.15 $1359 Water 0.81°~ $0.04 $382 SewerB Trash 2.58% $0.13 $1199 Electric 4.13°~ $0-.22 $1937 Oil Heat 10.45°k $0.55 $4900 Maintenance 2.13% $0.11 $1000 Management/Leasing Fees Total E naes 3.00% 45.89°h $0.16 $2.38 $1407 $21,427 Net Operating Income 64.31°b 826488 CAPITALIZATION Loan-To-Velue Ratio 80°k Market Interest Rate 7.0°k Term ears 20 E ui -To-Value Ratio 20°,5 E ui Dividend Rate 10.0°k Mo a e Constant 0.093036 BAND OF INVESTMEI4T Login Ratio x Mo a e Constant 0.074428 " Amounb an Rounded Automaticaly E ul Ratio x E Dividend Rate in this a roach." Ce 8alization Rate 0.094429 Net erotln Income Ca .Rab ~ Value $25488 0.094429 $288702 Implied Mortgage Pdneiple $218000 Annual Debt Service $20096 Debt Coverage Ralio 1.27 Value IntllcdUon: 27 Gross Income Mukiplier 5.14 OperaBng Expense Rallo 45.7°k Value Per Sq. Ft. Renbble $30.16 Value Per . Ft. Gmas Bld $30.18 ~ - 49 Capitalization with Tax Buiid-up Cap Rate Sa.Ft. SSISo_Ft. ANNUAL Commercial/Retail 2083 $8.00 $16,664 CommerciaVRetail ~ $60Dlmo. 980 $7,200 Total $23,864 Shop/Light Industrial @ $650lmo. 1993 $7,800 Unheated Storage 2nd Level 2112 $2.b0 $5,280 Total $13,080 2 BRA artments x2 $650lmo 1784 15 600 Total S ,Ft. & Gross Income 8952 $52 544 Less Vacan & Collection Loss Commercial 15% $3 580. Leas Vacan & Collection Loss Industrial 5°~ $390 Less Vacancy S Collection Loss (Storage) 20°k $1 056 Less Vacancy & Collection Loss (Apartments) 4°k $624 Commercial Effective Gross Income $20,284 Industrial Effective Gross Income $7,410 Storage Effective Gross Income $4,224 Apartments Effective Gross Income $14,976 Total Effective Grose Income $46,894 O retin Ex naea °h of Effective $$!sf Total Reserve For Replacement 6.40% $0.34 $3000 Real Estate Taxes 0.00% $0.00 $0 Insurance 2.90°k $0.15 $1359 Water 0.61% $0.04 $382 Sewer & Trash 2.58% $0.13 $1199 Electric 4.13°k $0.22 $1937 Oil Heat 10.45% $0.55 $4900 Maintenance 2.13% $0,11 $1000 Management! Leasing Fees 3.00% $0.16 $1407 Total Ex nse8 32.38°k $1.70 $15,184 Net Operating Income 87.82% $31711 CAPRALIZATION Loan-TaValue Ratio 8D% Market Interest Rate ZO% Term Years 20 E ui -To-Value Ratio 20% E u' Dividend Rate 10.0% Mort s e Constant 0.093036 BAND OF INVESTMENT Loan Ratio x Mort a Constant 0.074429 "Amounts ere Rounded Automatically E ui Ratio x E ui Dividend Rate 0.020000 In this a roach." MiOe a Rate 0. 1 195 Ca Italizatian Rate 0.113624 Net O retln Income Ca .Rate = Value $31711 0.113624 = $279084 Implied Mortgage Principle $224000 Annual Debt Service $20840 Debt Coverage Ratio 1.b2 Value Intlicatlon: 80000 Gross Income Multiplier 5.33 Operating Expense Re[IO 32.4% Value Per Sq. Ft. Rentable $31.28 Value Per S . Ft. Gross Bld $31.28 1~ 50 Tax~est for Tax Build-up Cap Rate 3a.Ft Sf/Sa.Ft ANNUAL CommerciaURetall 2083 $6.00 $18,884 CommeroialRtetail ~ $BDO/mo. 960 - $7,200 Total ~ $23,884 ShoplLight Industrial C~& $6501mo. 1993 $7,800 Unheated Storage 2nd Level 2112 $2.50 $5,280 Total $13,080 2 BR artmerds x2 $850/mo 1784 $15 800 Total Groan Income 8652 ~ $52 544 Lass Vacen 8 Collection Loss Commercial 15% 3 580 Less Vacan & Colbdion Loss Industrial 5% $390 Less Vacancy & Collection Loas {Storage) 20% $1 056 Less Vacancy & Collection Loss (Aparbnenta) 4°~ 624 Commercial Effective Gross Income $24284 industrial Effective Gross Income - $7,410 Storage Effective Grose Income $4,224 Apartments Effective Gross Income ~ $14,876 Total EffsctNe Oroas income $46,894 0 redo Ex ones % of Effective $$1sf Total Reserve For Replacement 8.40°l0 $0.34 $3000 Real Estate Taxes 11.36°fo $0.60 $5338 Insurance 2.90°~ $0.15 $1359 Wetet 0.61% $0.04 $362 Sewer & Trash 2.58% $0.13 $1199 Electric 4.13% $0.22 $1937 Oil Heat 10.45% $0.55 $4900 Maintenance 2.13% $0.11 $1000 Management /Leasing Fees 3.00% $0.16 $1407 Total Ex nsea 43.76°k $2.29 $20,520 Net Operating Income 58.24% $28378. CAPITALIZATION Loan-TaVatue Ratio 8D% Market Interest Rate 7.0% Term Years 20 E ui -To-Value Ratio E uit Dividend Rate Mo a e Constant 20% 10.0% 0.093036 A D OFI TMENT Loan Ratio x Mo a e Constant 0.074429 " Amourds are Rounded Automatically E ui Ratio x E u Dividend Rate D. D 0 In this a oath:' Ca itaiization Rate 0.094429 NetO redo Income Ca .Rab ~ Value $28375 0.094429 = $279307 Implied Mortgage Principle $224000 Annual Dabt Service $20840 ' Dabt Coverage Ratio 1.27 Value indication: ~2QOODD Gross income Multiplier 5.33 Operatng Expense Ratio 43.8°!° Value Par Sq. Ft. Rentable $31.28 Value Per S . Ft. Groes Bk7 $31.28 51 Capitalization Rates An overall capitalization rate, referred to as Ro, is an income rate for a total property value that reflects the relationship between the annual net operating income and the total property value, as indicated by the following formula: Income =Rate (Ro) =Value Band if Investment Since most property is purchased with debt and equity capital, the overall capitalization rate must satisfy the market return requirements of both investment positions. Lenders anticipate receiving a competitive interest rate commensurate with the perceived risk and also require that the loan principle be repaid through periodic amortization payments. Similarly; equity investors anticipate receiving a competitive equity cash return commensurate with the perceived risk. When the mortgage constant and equity capitalization rates are known, an overall rate may be derived with the band of investment using the following formula: Mortgage Component: M X Rm Equity Component: + (1-M) X Re = Ro Where: M =Mortgage Rm = Mortgage Constant Re =Equity Dividend Rate Ro = Overall Capitalization Rate The mortgage constant is calculated at current mortgage rates and terms. The equity divided rate is derived from the market. Consultation with area lenders indicated that a typical mortgage for a property such as the subject would represent 80% of the total value, with interest rates for similar properties ranging from 6.5°!° to 7,85% locally. These types of mortgages are typically amortized over 15-20 years, while the actual term is somewhat shorter, generally with a5-10-year baboon. The mortgage constant (Rm) is the ratio of the annual debt service to the principal amount of the mortgage loan and is calculated by multiplying each period's payment by the frequency of payment and then dividing this amount by the amount of the loan. The mortgage constant for the band of investment is calculated based on the above parameters used by loca4 lenders for mixed use type buildings. Due to the average risk involved and considering the favorable of the subject property, an equity rate of 10% is considered reasonable. I have also applied a 7% mortgage interest rate, with adjustments to apre-determined index at annual intervals thereafter. The annual constant with 20 years amortizatiomand an 80% loan-to-value ratio; which is consistent with rates quoted by local lenders of similar type properties. 52 _~, CAPITALIZATION RATE CALCULATION: -~., The capitalization rate is computed as the weighted average of the returns required by the mortgage and equity funds. This capitalization is used for valuing stabilized net income. The - overall capitalization rate is computed as follows: - ~ BO% Mortaaae. 20 Year Term. 7% interest Rate Y Portion Rate Weighted Rate Mortgage .80 X .093036 .074429 Equity .20 X .10 .020000 Weighted Average 1.00 .094429 CALCULATION OF VALUE OF INCOMESTREAM: The direct capitalization approach converts a single year's estimate of net operating income into value by the application of an overall capitalization rate. The overaN capitalization rate allows for both the return on and the return of capital. The subject estimated value is calculated as follows: STABILIZED NET INCOME _ $25468 _ $269702 ADJUSTED OVERALL CAP RATE _ .094429 ESTIMATED VALUE (ROUNDED) _ $270,000 The value indication, when derived from the above assumptions, would require a Debt Covered Ratio (DCR) of 1.27. This is within the 1.2 to 1.3 range currently required by most lending institutions. PLEASE NOTE: My band of Investment model reflects the actual lengthy series of decimals per component to derive tfie overall cap rate. The overall cap rate component shown above is rounded for illustration purposes. As previously noted, the subject property appears to be over assessed. The actuaV taxes for the subject are $6,243 which represents 13.3% of the subject's effective gross income and is high as compared to market standards. Current taxes are based on the county's implied market value at $325,230 for the subject property. The assessment office may not be aware that the 2nd level. of 100 S. Market St. is not finished and that zoning would not permit finishing due to lack of 15arking. The subject estimated value with a tax loaded capitalization rate is as follows: STABILIZED NET INCOME _ $31,711 _ $279,084 ADJUSTED OVERALL CAP RATE _ .113624 ESTIMATED VALUE (Rounded) _ $280,000 53 ___ i_ SALES COMPAR130N -IMPROVEMENT VALUATION .- The approach through which an appraiser derives a value indication comparing the property to be ~ appraised to similar properties that have been sold recently, applying appropriate units of comparison and making adjustments, abased on the elements of comparison, to the sale price of comparable. In applying the Sales Comparison/Market Approach, the appraiser takes the following steps:. 1. Researches the market and selects the sales and/or listings of properties most comparable to the property being appraised. Generally, the most current and similar comparable sales prove to be the best indicators of the value of the subject. 2. Collects and verifies data on each selected property's selling and listing prices, dates of sale, physical differences, locational characteristics and any special conditions. 3. Analyzes and compares each property with the subject as to time of sale, location, physical characteristics, conditions of sate and other differences. 4. Adjusts the sales or listing price of each comparable far differences between it and the subject. Adjustments are based on market extractions and/or judgment. l 5. Reconciles the adjusted prices of the comparable properties into an indication l of value for the property being appraised. In an effort to arrive at value indications by the Sales ComparisoNMarket Approach, numerous sales of reasonably similar properties in surrounding areas were studied, as well as current listings and properties under contract. Only the most comparable sales have been selected for inclusion in this report. Verification of sales information with realtor, grantor, grantee and/or courthouse records was conducted where possible. Special attention was given to terms of sale and special conditions to determine that the transactions were"arms length." II~ Each comparable property was compared to the subject property, and adjustments were made for significanf differences in the sales that reflect market reaction. In this analysis of building sales, the price per square foot of gross building area is used. The adjusted price of each comparable indicated a value range for the subject, which was then reconciled into a sirigle value ,~ indication via the Sales ComparisonlMarket Approach. On the following pages is a brief description of the market sales selected to help estimate market value by this approach. 54 - - L COMPARASLE.SALE ONE Location: 2&30 N. Market Street, Borough of Mechanicsburg, Cumberland County, Pennsylvania 17055 Transaction Data: Consideretion: Date of Sale: Grantor: Grantee: Tax Parcel: Deed Reference: Conditions of Sale: Property Rights Conveyed: Financing: $254,000 May 10, 2006 Cooper, Danny A. & Linda K. Heustess, Rollace E ~ Barbara A. 18-23-05fi5-049 DB 274 PG 2313 Arms length Fee Simple Conventional Improvement Data: Construction: Quality of Construction Size: Age: Condition: Utility: Occupancy at Sale: Site Data: Area: .Public Utilities: ShapeRopagrephy: Zoning: AccessNisibility: Land to building Ratio: Brick Average 5,458 Square Feet 108 +/- years, par tax card Average Average Retail on first level and 2 residential Apartments on the second level 0.24 acre or 10,454+/- square feet All available Rectangular /Level at street grade C-G Commercial General Average /Average .1.92 to 1 Aoaraisal Measures: Sale Price Par Square Foot: $46.54 Confirmed with: Grantee: Barbara A. Heustess and Tax Assessment Office {~ Comments: Located one black north of the square in the heart of Mechanicsburg. Lot adjacent to the railroad tracks. Brick 2-story detached building built in 1954 with retail uses on the first level. Integral two car garage in rear. Second level front apartment has living room, kitchen, two bedrooms, bath, electric heat and window air conditioning units. Rear second level apartment has a living room, kitchen, one bedroom, bath, electric heat and air conditioning. Older style finish with panel walls, carpeting, suspended the ceiling, electric baseboard heat and central air conditioning. No basement present. Building has a filat roof. Comer lot location at N. Market Street and Strawberry Alley. No on-street parking in front of property. Paved parking for eight cars on north side of building. Paved driveway extends to rear with access also on alley. 55 • • COMPARABLE SALE TWO Location: 107/109/111 N. Market Street, Borough of Mechanicsburg, Cumberland County, Pennsylvania 17055 Transaction Data: Consideration: Date of Sale: Grantor: Grantee: Tax Parcel: Deed Reference: Conditions of Sale: Property Rights Conveyed: Financing: $335,000 May 8, 2008 DriveKore Inc. Ayers Group LLC 19-23-0565-009 DB 2008-15069 Arms length Fee Simple Conventional Improvement Data: Construction: Quality of Construction Size: Age: Condition: Utility: Occupancy at Sale: Site Data: Area: Public Utilities; ShapelTapography: Zoning: AccessNisibility: Land to building Ratio: Brick and block Average 9,144 Square Feet 108+/- per tax card Average Average Two story office with attached warehouse 0.15 acre or 6,534+/- square feet All available Rectangular 1 Level at street grade C-G Commercial General Average /Average 0.71 to 1 Aaoraisal Measures: Sate Price Per Square Foot: $36.64 Comments: Two story brick elevation office with attached rear warehouse, Internal lot location with no on-street parking permitted on N. Market Street. Lot extends to Railroad Avenue (alley) in rear. Warehouse has rear access off of this alley. No other parking on site. Office has been updated. Located approximately two blocks north of Mechanicsburg square. 56 Com arable Sale Photo ram J_-- gale #3 COMPARABLE SALE THREE Location: 40 W. Main Street, Mechanicsburg Borough, Cumberland County, Pennsylvania 17055 Transaction Data: Consideration: Date of Sale: Grantor: Grantee: Tax Parcel: Deed Reference: Conditions of Sale: Property Rights Conveyed: Financing: $214,789 June 26, 2006 William M. Kerr R-Squared Properties LLP 19-23-0565-020 DB 275 PG 1466 Arms length Fee- Simple Conventional ImorovemenY Data: Construction: Quality of Construction: Size: Age: Gondition: Utility: Occupancy at Sale: Site Da Area: Public Utilities: ShapelTopography: Zoning: AccessNisibility: Land to building Ratio: Brick 3 story detached residential conversion Average 4,036 Square Feet 108+/- per tax card Average Average Commercial dffice/retail on first level. with two Residential apartments above 0.15 acre or 6,534 square feet All available Rectangular! Level at street grade C-CBD Central Business District Average /Average 1.62 to 1 Appraisal Measures: Sale Price Per Square Foot: $53.22 Confirmed with: Grantee: Brenda Robinson and courthouse records. Comments: Brick former residential dwelling built in 1890 converted into commercial uses on the first level with two residential apartments (one 3BR & one 1 BR) above. Paved parking in rear for six cars with rear alley access; plus, municipal parking lot in rear and on-street parking permitted in firont of building. First level office/retail finished with plaster walls, wood floors, half bath and central air conditioning. Second level has a large 3-bedroom apartment with living room, dining room, kitchen, 3-bedrooms, bathroom and thru wall air conditioning units. Third level apartment has living room, kitchen, one bedroom, bath room and heat pump. Full basement. Separate meters with tenants paying for utilities. Sale price reflects needed brick work and roof work. 58 COMPARABLE SALE FOUR Location: 1080 Chambers Street, Swatara Township, Dauphin County, Steelton, PA Transaction Data: Consideration: $250,000 Date of Sale: November Z, 2006 Grantor: Sandra and Edward Shuey Grantee: Derr, Aric Dane Tax Parcel: 63-061-007 Deed Referonce: 20060/45204 Conditions of Sale: Arms length Property Rights Conveyed: Fee Simpie Financing: Conventional Imarovement Data: Construction: Quality of Constructian: Size: Age: Condition: Utility: Occupancy at Sale: Site Data: Area: Public Utilities: Shape/Topography: Zoning: AccessNisibility: Land to building Ratio: Aaaraisal Measures: Sale Price Per Square Foot: Brick & frame 2 story Average 8,103 Square Feet 1944 Average Average Retai{ & residential apartment 0.207-acre or 9,017 square feet All available Rectangular /Level CL, Commercial Limited Average i Average 1.11 to 1 $30.85 Confirmed with: Grantee: Mr. Derr and public records Comments: A two story frame and brick, commercial building previously occupied by Peck's retail clothing store on the first and second levels with a first level apartment with separate entry. Apartment has a living room, kitchen with all appliances and full bath. Retail utilized on first artd second levels, storage room/offices, storage on 2ntl level and two hail baths. There is also a covered 2-car carport and on-site parking for 12 cars. On street parking is also available. Overall the buiiding was considered in average condition. The owner is in the process of renovating the building and will occupy a majority of the buiiding (he has a plumbing and HVAC company known as A.D.D. Enterprise, Inc.). 59 Comparable Sale Photographs Sale #3 Sale #4 60 Sales Gomparison Approach 1 2 3 4 100.102 S Market 3L & 5 W, lACttst St. Mechanicsburg Borough Address: MuniG I 26.30 N. Market St. Mechanlceburg Borou h 10711091111 N. Market St. Mechanicsburg Borou h - 40 W, Main St. Mechanicsburg Borou h 1080 Chambers St. Swatare Twp. Steelton Sak Prfee $254,000 $335,000 $214,789 $250,OOD Bulldln Size S . Ft. b458 9144 4036 8103 lAt Size Ft 10464 6534 8,534 9017 er q. 1 l~f8.84 ;38.84 ;83.22 $30.88 Date of Sale May-06 May-OB Jan-OB Nov-06 Time Ad ustment 2% 0% 2% 2% Time Ad usted Value $47.47 $36.84 $54.26 $31.47 CondlSona of Sale Cash Equiv. Caeh Equiv. Ceah Equiv. Csah Equiv. Financln Ad' stmeM 0°!0 0% 0% 0% Ad'uated Price / 5 . Ft. ;47.47 ;36.84 ;64.28 ;31.47 Location Similar - ~ Similar Similar Inferior Ad'uatment % D°k 0°h 0% 10°~ Size Buildin : S Ft Smaller Similar Smaller Similar 8 952 5458 8144 4036 8103 Ad'uatment % -5% D% -5% 0°,6 Functional Utll' Similar Inferior Inferior Simtlar A mart °k 0% 5% D% D% A e & Oua ' lCondttion Similar Inferior Superior IMenor Ad'ustment % 0% 5% -10% 10°k Land-to-Sid .Ratio Superior Similar Superior Superior 0.982:1 1.92 0.71 1.62 1.11 Ad'ustment -16% 0% -15% -16°h Zonln & Utilltlea Similar Similar Similar Superior Ad'ustmeM 0°h 0% 0°(° 0% Other: Utlltt /Use Superior Superior Superior Superior Ad ustment °k -15% -15% -15°k -15% Total Ad'ustmenta -35°h -5% -45°k -10°~ Value Indication $/af) ;30.85 $34.80 $29.88 $28.32 Value Indication ($) $278,206 $311,568 $267,508 $253,546 Sales Wei h8n 1 3 4 2 Wel hted Avers Value ;276,382 (30.78 8tat1 BNaeures Per Square Faot Range: 28.32 ;34.80 $253 546 $311 588 Midpoint: $31.58 $282 557 Variance: +/- 10.27% 10.27% Median: Mean Avers e: 830.37 $30.97 $271,858 $277,207 General Discussion of Elements of Comparison in general, there is an upward adjustment if the comparable is ihferior to the subject for a given element of comparison and a downward adjustment where the comparable is superior to the subject for a given element of comparison. Financina Adjustments: The comparable sales have been adjusted for financing terms, if necessary. In this appraisal, there were no adjustments for financing on either the small tract or large tract. Conditions of Sale: Conditions of sale adjustments typically reflect the motivations of th® buyer and seller. Each of the completed transactions was verified to be an arm's {ength transaction between knowledgeable and willing market participants under no duress ether to buy or to sell. Time Adjustments: After adjusting all the comparables to a cash equivalent price the safes must be brought current by means of a time adjustment to account for changing market conditions from the date of each compareble sale to the effective date of this appraisal. Location Adjustments: These are based on the relative strength of the surrounding land uses and accessibility to major activity centers and access ways. This adjustment is based on each comparabfe's Vocation relative to the subject. Sale #4 was adjusted due to inferior location and traffic count. Buildina Size Adiustments: As a factor in pricing, size was considered on the basis of gross square feet of building area. Larger buildings generally sell for prices lower than smaller buildings due to economies of scale. Land-to-Buildina Ratio: This adjustment compares the land size and availability to possible expansion in the future. It also reflects subject's limited parking and inability to add parking. BUILDING COMPARABLE COMMENTS: Sale #1 was the purchase of a mixed use property containing 5,458 square feet and has a similar location as the subject, i.e., parking not permitted in front of building. Purchased for a total consideration of $254,000 or $46.54 per square foot value, This sale was included in this survey to reflect similar locational influences. An adjustment is warranted for date of sale, given today's superior market conditions: Adjustments are also warranted for smaller size, superior land area, and subject's tack of finish and utility of the second level in 100 S.Market Street. Following adjustments, a value indication of $30.85 per square foot or $276,500 (rounded) is implied for the subject. Sale #2 was the purchase of an office/warehouse containing 9,144 square feet and located just north of the subject. Purchased for a total consideration of $335,000 or $36.64 per square foot value. This sale was included in this survey to reflect commercial values in the borough. An adjustment is warranted for date of sale, given today's superior market conditions. Adjustments are also warranted for inferior functional utility and quality lacking apartments and functional utility of subject's unheated second level storage area. Following adjustments, a value indication of $34.80 per square foot or $311,500 (rounded) is implied for the subject. 62 S la a #3 was the purchase of a mixed use property containing 4,036 square feet and located on Main Street in the heart of the borough. Purchased for personal office use for a total consideration of $214,789 or $53.22 per square foot value. This sale was included in this survey to reflect value of superior borough commercial property. An adjustment is warranted for date of sale, given today's superior market conditions. Adjustments are also warranted for smaller size, superior qualitylcondition, larger lot size, and inferior functional utility of subject's unheated second level storage area. Following adjustments, a value indication of $29.88 per square foot or $267,500 (rounded) is implied for the subject. Sale #4 was the purchase of a mixed use property containing 8,103 square feet and located in a similar older established neighborhood. Purchased for a total consideration of $250,000 or $30.85 per square foot value. This sale was included in this survey to reflect a similar mixed use commercial property. An adjustment is warranted for date of sale, given today's superior market conditions. Adjustments are also warranted for inferior location not having similar in town Location, inferior agelcondition, superior land-to-building ratio and subject's unheated second level storage area. Following adjustments, a value indication of $28.32 per square foot or $254,000 (rounded) is implied for the subject. Following all adjustments, a value range from $28.32 to $34.80 per square foot or from $253,500 to $311,500 is implied. The Midpoint within this range is $30.37 per square foot and the survey Mean is $30.97 per square foot. In addition, each market sa{e was weighted according to its degree of comparability. Most weight was placed on Sale #1 which is a mixed use property and located close to the subject. From this analysis, a weighted average value of $30.76 per square foot or $275,000 (rounded) is implied. Based primarily on the most heavily weighted market sales and statistical measurements, your appraiser estimates the fee simple market value to be $31.00 per square foot or $277,512 when applied to the subject building size of 8.952 square feet. This has been rounded to $278,000. $31.00/sq.ft. x 8,952 sq.ft. _ $277,512 (ROUNDED) _ $278,000 63 • RECONCILIATION AND CONCLUSIONS The indications of value as developed by the three approaches to value are as follows: VALUE ESTIMATES: Cost Approach na income Approach $270,000 Income Approach $280,000 (with built-up Cap Rate) Sales Comparison Approach $278,000 The Cost Approach generally will result in an excellent estimate of value 'rf the building is new or reasonably new, and the improvements reflect the highest and best use of the land. However, when kerns of physical deterioration and obsolescence must be estimated, an area of judgment is involved which is subject to error. The cost approach was not utilized due to age. In the Income Approach, net income is capitalized into an estimate of value by the application of an appropriate market derived capitalization rate. The inherent weakness of the Income Approach is in the accurate estimation of market revenues, occupancy, and operating expenses. The Income Approach is most useful in investor owned properties, which derive their value from the cash flow. Generally, purchasers of commercial properties are more concerned with the income the property will produce than with ks reproduction cost. Most purchasers of properties similar to the subject take into consideration the tax advantage accorded owner occupied properties through depreciation, as well as seeking a long term investment or retirement fund. An investor may also anticipate a profit to be realized through appreciation at the conversion. By the Income Approach, owner-occupancy is not considered. This approach is viewed through the eyes of a typical investor. There has been sufficient market data to provide a reasonable indication of value from the Income Approach. The ability of the property to continue to provide a reasonable return and the competitive position of this investment were considered. Based on the market data, it appears the subject property is over assessed. The stabilized operating statement was also done with a tax built-up cap rate. A tax appeal is recommended. The Sales Comparison Approach is an approach to value wherein the appraiser seeks out sates of similar types of properties that have recently sold in the subject's trade area. These sales have been compared to the subject and adjusted for dissimilarities between the sale properties and the subject to arrive at an indication of value. Theoretically, the Sales Comparison Approach reflects the actions of both buyers and sellers in the market. The inherent weakness in the Sales Comparison Approach is that no two sales or properties are exactly alike. Therefore, adjustments are applied based on interpretations of market information. This approach is most reliable when there are relatively homogeneous properties or when there are certain strong, similar traits that transcend the sales sample. A major segment of mixed use real estate of this type in the borough is owner-occupied. For this type of property the income Approach is usually less sign cant than the Sales Comparison/Market Approach or the Cost Approach because owner-occupants are not interested in leasing. 64 ~__ ~, r Due to the lack of comparable sales, most weight was placed on the income approach. ... Taking all of the foregoing factors into consideration, and based on a reasonable marketing time as defined and contingent upon Assumptions and Limiting Conditions, it is my opinion that the -`- property had an estimated retrospective market value as of November 28, 2008 of: ,. * * * TWO HUNDRED AND EIGHTY THOUSAND DOLLARS * * * o ($280,000) Employment in and compensation for making this appraisal are in no manner contingent upon the value reported. f certify that 1 have no financial interest in the property appraised, present or contemplated, and that the appraisal .assignment was not based on a requested minimum valuation, a specfic valuation, or the approval of a loan. Your appraiser has personally inspected the property. 65 APPRAISER'S CERTfFfCATfON I certify that, to the best of my knowledge and belief: The statements of fact contained in this report are true and correct. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased professional analyses, opinions, and conclusions. = I have no present or prospective interest in the property that is the subject of this report, and I have ho personal interest or bias with respect to the parties involved. = I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. = My engagement in this assignment was not contingent upon developing or reporting predetermined results. My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. = The reported analyses, opinions, and conclusions were. developed, and this report has been prepared, in conformity with the Unifomr Standards of Professional Appraisal Practice. = i have made a personal inspection of the property that is the subject of this report. Mo one provided significant professional assistance to the person(s) signing this report. The vse of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. The reported analyses, opinions and conclusions were developed and this report has been prepared in conformity with the requirement of the Code of Professional Ethics and the Standards of Professional Appraisal Practice of the Appraisal Institute. /} r Signature: `~ G~-~L- Data: 5-~' z o a Karen Damey Cert~ed General Real Estate A raiser Pennsylvania Certification No.: GAOOt260L '~~ 66 ~~! UNAPPARENT CONDITIONS It is assumed there are no hidden or unapparent conditions of the property, subsoil or structures, including possible existence of dry rot, fungus, termites or other vermin, which might render it more or less valuable than an otherwise comparab{e property. No responsibility is assumed for such conditions nor for any engineering required to discover such things. Additional inspection by a qualified professional is recommended. Physical items described are to be used as a genera! guide for property valuation and not as a complete and detailed physical report. Conditions behind welts, above ceilings, behind locked doors, or under the ground, which are not exposed to casual view, were not inspected. No warranty is given or implied on structural or mechanical items of the properky. I suggest that an expert be hired far a detailed investigafion, if desired necessary. A structural pest control report has not been obtained for this valuation. If such report would uncover necessary corrective work, which is normally preformed at the expense of the current owner, this cost would be deducted from the estimated value. Subsurface rights such as minerals, oil and gas deposits were not considered in this report. Your appraiser has not been provided with a soil analyses offering evidence of the structural ability of the subsurface for support of improvements. Upon personal inspection, your appraiser did not riotice physical indications that supporting strata would be unsuitable for improvements. While the land surface has been inspected, as far as possible, by observation, it was not possible to personally observe conditions beneath the soil. Therefore, no representatives are made as to these matters. The value opinion is subject to any soil conditions that would cause a loss in value. Your appraiser is not a building or environmental inspector. An appraiser provides an opinion of value. The appraisal does not guarantee that the property is free of defects or environments! problems. Your appraiser observed visible and accessible areas only. Mold may be present in areas other than the visible and accessible .areas. A professional building inspector or environmental inspection is recommended. ASSUMPTIONS AND LIMITING CONDITIONS 1 assume no responsibility for matters legal in character nor do i render any opinion as to the title, which is assumed to be good; existing liens and encumbrances have been disregarded; and the property is appraised as though free and clear under responsible. ownership and competent management. I believe to be reliable the information identified in this report as being furnished to me by others, but I assume no responsibility for its accuracy. I assume that the utilization of the land and improvements is within the boundaries of the property lines of the property described and that there is no encroachment or trespass unless noted within the report. No survey of the property has been made by your appraiser and no responsibility is assumed in connection with such matters. Any maps, puts, or drawings reproduced and included in this report era intended only for the purpose of showing spatial relationships. - -- 67 Possession of this report, or copy thereof, does not carry with it the right of publication, nor may it be used for any purposes by anyone but the intended user/client and, in any event, only with proper quaycations. l have no present or contemplated interest in either of the properties appraised The distribution of the total valuation of this report between land and improvements applies only under the existing program of utilization. The separate valuations for land and building must not be used in conjunction with any other appraisal and are invalid 'rf so used. I am not required to give testimony or to appear in court by reasohs of this appraisal, with reference to the property in question, unless arrangements have been made previously. Mathematical models are based on estimates and assumptions that are inherently subject to uncertainly and variation; I do not represent them as resu{ts that will actually be achieved. The information and opinions contained in this appraisal set forth the appraisers' best judgment in light of the information available at the time of the preparation of this report. Any use of this appraisal by any other person or entity, or any reliance or decisions based on this appraisal are sole responsibility and at the sole risk of the third party. I accept no responsibility for damages suffered by any third party as a result of reliance on or decisions made or actions taken based on this report. This report has been made in conformity with the Uniform Standards of Professional Appraisal Practice and the Appraisal Institute.. 68 • RSR appraisers a&.nalysts QUALIFICATIONS KAREN DARNEY PROFESSIONAL EXPERIENCE: January 1, 2006 to Present: RSR Appraisers & Analysts fee appraiser of large and small commercial and industrial properties, farms, condemnations, tax appeals, vacant ground, multi- family units an single family homes including FHA, new construction, condominiums and employer relocation. Subcontractor known as Darney Associates, Inc. a Woman Owned business. August, 1994 to Present: L. G. Real Estate Appraisers, Ltd. Broker/Owner and fee appraiser of large and small commercial and industrial properties, farms, condemnations, tax appeals, vacant ground, multi-family units and single family homes including new construction, condominiums and employer relocation. Supervised and trained appraisers. April, 1994 to August, 1994: Lester G. Connor, MAI. Fee appraiser -large and small commercial and industrial properties, farms, condemnations, tax appeals, mufti-family and single family residential properties including new construction, condominiums and employer relocation. February, 1992 to April, 1994: K. Jesse Reitenbach Associates, LTD. Fee appraiser -commercial and single family residential properties including new construction, condominiums and employer relocation. October, 1990 to January, 1992: Associate Broker doing residential sales for Jack Gaughen Realtor and Coldwell Banker MGM Realty, Inc. Managed and sold new construction in nine developments; and, sold resale properties. September, 1985 to September, 1990: Associate Broker with Coldwell Banker MGM Realty, Inc., Office manager for offices located in Hershey and Middletown, PA. December, 1979 to August, 1985: Sales Associate for Owen-Gross, Inc., Partners. Reai Estate Instructor for the Institute of Real Estate Studies teaching in Harrisburg and York. '~ EDUCATION: ' 1969 West Virginia University Morgantown, West Virginia Bachelor of Science in Nursing Post Graduate Academic Education: 1974 University of North Carolina Chapel Hill, North Carolina 1972-73 Temple University, Harrisburg, Pennsylvania 3 Lemoyne Drive, Suite 100 • Lemoyne, PA 17043 • Phone (717) 763-1212 • Fax (717) 763-1 APPRAISAL COURSES & SEMINp.RS: Real Estate Analysis, RA2 Appraisal Standards and Ethics, RA5 Acceptable Residential and Commercial Appraisals Cost and Income Approaches, RA4 Appraisal Principals, 1110 Appraisal Procedures, 1120 Narrative Appraisal Report Residential Case Study, 1210 Appraisal Reporting of Complex Residential Properties -Appraisal Institute Income Approach to Appraisal Basic Income Capitalization, 1310 Advanced Income Capitalization, 11510 Appraising for FHA Insured Loans Standards of Professional Practice, Part A - 1410 Standards of Professional Practice, Part B -1420 Report Writing and Valuation Analysis, 11540 Fundamentals of Relocation Appraising -Appraisal Institute Marshall & Swift Commercial Cost Approach Highest and Best Use and Market Analysis, 11520 Easement Valuation -Appraisal Institute The Appraiser's Legal Liabilities -Appraisal Institute Appraisal of Nursing Facilities -Appraisal Institute Advanced Sales Comparison and Cost Approach, 11530 Valuation of Leased Fee Interests -Appraisal Institute Valuation of Leasehold Interests - Appraisal Institute Partial Interest Valuation -Divided -Appraisal Institute FHA Appraisal Inspection from the Ground Up -Appraisal Institute Federal Banking & PA Regulations that Apply to Appraisal Subdivision Valuation -Appraisal Institute Appraising the Tough Ones (Residential) -Appraisal Institute Introduction to Eminent Domain -Appraisal Institute FHA Issues -Appraisal Institute lax Free Like-Kind. Exchanges -Appraisal Institute Professional's Guide to the Uniform Residential Appl.. Report -Appraisal Institute Rates & Ratios: Making Sense of GIM's, OAR's and DCF -Appraisal Institute Capitalization Theory and Techniques -A Complete Review -Appraisal Institute PA Assessment Law and Procedures -Appraisal Institute PROFESSIONAL DESIGNATIONS AND LICENSES: 2006 Pennsylvania Associate Broker License #AB-044264-A 1994 Pennsylvania Broker License #RB-044264-L 1994 Appraisal Institute AfFliate, Candidate for MAI, #M940777 1994 Pennsylvania State Certified General Real Estate Appraiser, GA-001260-L 1992 Certified Commercial Real Estate Appraiser (CCRA), National Association of Real Estate Appraisers. #46120 70 PROFESSIONAL DESIGNATIONS AND LICENSES Cont'd: 1992 Certified Dispute Settler in Dispute Resolution System Mediation, National Academy of Conciliators. 1988 Certified Residential Specialist (CRS), Residential Sales Council of the Realtors National Marketing Institute. #7636 1988 Certified Code of Ethics Instructor, Pennsylvania Association of Realtors. 1985 Pennsylvania Real Estate Instructor, License #RI-00648-A 1984 Pennsylvania Real Estate Associate Broker #AB-044264-A 1982 Graduate Pennsylvania Realtors Institute (GRI), a National Association of Reactors Designation. 1979 Pennsylvania Salesperson License #RS-122124-A __ PROFESSIONAL ORGANI2:ATIONS: Appraisal Institute, Affiliate Member Central Pennsylvania Chapter, Appraisal Institute, Board of Directors Pennsylvania Association of Realtors Board of Directors, 2006, 1996, 1995, 1994, 1993, 1992; Committee(s) Member Greater Harrisburg Association of Realtors; Past President - 1996; President -1995; Board of Directors - 1987 to 1997; held all officer positions, instructor, chairman of various committees Foundation Board of Directors 1995-1996 COURTS OF TESTIMONY -EXPERT WITNESS: Cumberland County Dauphin County York County Lebanon County Adams County FEE APPRAISER AND CONSULTANT TO: Various banks, mortgage companies, credit unions, employee relocation companies, broker trade programs. Approved appraiser for Pennsylvania Department of Transportation and as a HUD (FHA) appraiser. The majority of appraisals completed are in Cumberland, Dauphin, Perry, northern York, and Lebanon Counties. 71 .~ ca »~ _,,y kcupaoional A17airs ~~ 72 Certlficste :Number GA001$60L ,Ac~cfend~um 73 Q~ • ,~ n'~ .~'ryQ'4de t~~~ K • ~ S p ¢~ ~Yt ~e ~~ae ., ~a~kRQ':m ~ k~ ~S 4gs:q~ v ~ d, ,Tl~ a 6dS Ao-Q h Oa ~ W dye g' 40 ~~ ~ m ~ Caxrorol Pwrc ~ A4e ~. ~ s ~ 4~ n .. x ~ ~ ~ynd st 6 pO~~ynd ~ 4~tofl. ~ k`. ~Z'+~Rn'- -. .. ~pgn-`''t t m , p ~ yicA'K~ 6 0~., ~~a flt. SMlorx Memari-1 py4: .aecGanicslxa ~~ 5~ ~ "Tft~ 9`I° r>~St ,yr m 115 .y "~ ,agt~ ~ Y! Y ~ ~ ~ Sx 4%. Sa`~t~ "tr, ~ Nastr parr 9t Fg1st'~ ~~~ ,~. ~getMt `N GpO~t m ~~ P"'° M~'~St ~n e~''"°~A~$ °~gOrPGs~ ~,y Std'„ ~~, ~ "rte ~`R~ a ~ ~ ~hat~A ~~ ~, Ug ~ ~ ~~~ N H~ ~ ~' Fy O m a~ V ~a~ Ga~~~~ ~~~pvo ~' in ~~$a N ptidta~`~1 L P~p'kea~ - ~ ~~ ~ >n ~~._~_. s,:,~ -; , rtn , u.; ~ a 0 3 'a~.'JOJ Miero"oRCwp s7t00i Nn01E0, ane/arkk OOaF,I~t. G1fY -~------.. GOIErtIy__._.,.._..__._.-.-~_.. _.._._._...... THIS DEED TAX PARCEL No: 16-23-0565-071 and 16-23-0565-057 MADE this /S~~ day of Dro~,y dir/ , in the yeaz of our Lord, Two Thousand Five (2005) by and between: ~`> HAZEL I. WRIGHTSTONE, also known as HAZEL `~ WRIGHTSTONE, party of the first part, hereinafter r;; -= 4_c ` called "Grantor", by LINDA MINNICH and SUE rv WITTERS, her Attorneys-in-Fact, c~ - :;~ .-~ A l~T{~ ~ T L1~V1J CLYDE WRIGHTSTONE, party of the second part, ~, hereinafter called "Grantee": -~ WITNESSETH, that in consideration of the sum of One and No/100 ($1.00) Dollar, in hand paid, the receipt whereof is hereby acknowledged, the said Grantor does hereby grant and convey unto the Grantee, his heirs and assigns; AL.L those three (3} certain pieces or pazcels of real estate situated in the First Wazd in the Borough of Mechanicsburg, County of Cumberland and Commonwealth of Pennsylvania, more particularly bounded. and described as follows; PARCEL NO. 1: BEGINNING at a point at the comer of the building line of South Market Street and West Locust Street; thence by the dividing line of West Locust Street South 72 degrees West, one hundred thirteen (113) feet to an iron pin on said building line and at comer of land formerly of Robert H. Kuper, now Parcel No. 2 described hereinbelow; thence by the line of said Parcel, South 19 degrees East forty-one and five one-hundredths (41.05) feet to an iron pin; thence by the same South 72 degrees West, thirty-five (35) feet to an iron pin at Weaver Alley; thence by said Alley, South. 19 degrees East, seventeen and five-tenths (17.5) feet to an iron pin at land now or formerly of the heirs of Sohn Beelman, deceased; thence by the line of said Parcel, North 72 degrees 30 minutes East, one hundred forty-seven and six-tenths (147.6} feet, more or less, to a point on the building Iine of South Market-Street; thence by the building Line of South Mazket Street, North 18 degrees 30 minutes Westsixty and forty-seven one-hundredths (60.47) feet to a point, the place of BEGINNING. BEING the same premises which Harry Mohler and Paul A. Mohler, Executors of the Last Will and Testament of Mattie J. Mohler, deceased, by their deed dated May 25, 1959, and recorded in the Office of the Recorder of Deeds in and for Cumberland County, Pennsylvania, in Deed Book "D", Volume 19, Page 290, granted and conveyed unto Clyde E. Wrightstone and Hazel I. Wrightstone, his wife; the parties herein. PARCEL N0.2: BEGINNING at an iron pin on the building line of West Locust Street and at the corner of Pazcel No. 1, described hereinabove; thence by said building line South 72 degrees West, thirty-five (35} feet to an iron pin at Weaver Alley; thence by said Alley, South 19 degrees East, forty-one and five one-hundredths (41.05) feet to an iron pin at corner of said ~~ !~ ~a w w ,~. ^a.n a.fT Pazcel No. 1 described hereinabove; thence by the line of said Parcel, North 72 degrees East, thirty-five (35) feet to an iron pin at corner of said Parcel; thence continuing by said Pazcel No. 1, North 19 degrees West, forty-one and five one-hundredths (41.05) feet to an iron pin on the building line of West Locust Street, at the place of BEGINNING. BEING the same premises which Alice A. Rhodes, widow, by her deed dated June 29, 1963, and recorded in the Recorder's Office aforesaid in Deed Book "X", Volume 20, Page 673, granted and conveyed unto Clyde Wrightstone and Hazel Wrightstone, his wife, the parties herein. PARCELS NOS. 1 AND 2 being improved with two commercial buildings with apartments known and numbered as 100-102 South Mazket Street and 5 West Looust Street. PARCEL N0.3: ALL that certain pazcel of land with the improvements erected thereon situated on the south side of West Locust Street (First Ward) in the Borough. of Mechanicsbtug, Cotulty of Cumberland and State of Pennsylvania, bounded and described as follows, to wit: ~ Bounded on the north by West Locust Street, on the east by lot now or formerly of I Herman Myers, on the south by a public alley, and on the west by lot nor or formerly of T.M. Moyer; having a frontage on said Street of fort}-three (43) feet, more or less. BEING improved with an apartment building known and numbered as 37 West Locust Street with detached garage. BEING the same premises which Ella N. Oyler, by her deed dated September 1St, 1948, and recorded in the Recorder's Office in and for Cumberland County in Deed Boolc "W", Volume 13, Page 546, granted and conveyed unto Clyde E. Wrightstone and Hazel I. Wrightstone, lus wife, the parties herein. 'T'his Deed is a transfer from wife as Grantor to husband individually as Grantee, for die purpose of vesting full ownership of the above Pazcels in husband, and; therefore, said transfer is exempt and excluded from realty transfer taxes. AND said C-rantor hereby covenants and. agrees that she will warrant specially the property hereby conveyed. IN WITNESS WHEREOT', the Grantor has hereunto set her h~uid and seal the day and yeaz above written. WIT ED BY: / /_ ~ ~/ ~11 6~~- ~'~'" ~X.Y~ ~ ~ o.~'~ (SEAL) Hazel I. rightstone also known as Hazel Wrightstone -2- By~L'/lf,(,GC %~'~i~yil~ (SEAL) Linda Minnich and .,Y By~~ `~-~`~,~`~~~ (SEAL) Sue Witters Attorneys-in Fact COMMONWEALTH OF PENNSYLVANIA) :;5S COUNTY OF CUMBERLAND On this, the /~~' day of ~rrwv~', 2005, before me, a Notary Public in and for the Commonwealth and County aforesaid, the undersigned officer, personally appeared Linda Minnich and Sue Witters, tcnown to me (or satisfactorily proven) to be the pezsons whose names are subscribed to the within instrument, and acknowledged that they executed the same for and on behalf of the said Hazel I. Wrightstone, also known as Hazel V~%rightstone for the purposes therein contained. IN WITNESS WHEREOF, I heretmto set my hand. and official seal. COMMONWEALTFi OF PENNSYLVANIA ~Notaria: Seal ~ ~~ Susan L Matrazi, Notary Public Mechanicsburg Boro, Cumberland County My Commission Expires Nov. 24, 20W Member; Pennsylvania Association Of Notaries "~ NOtary PUb11C CER'I'LF'ICA'I'E OF RESIDENCE Dated: sec . I ~F , 2005 I certify that the precise residence and complete post office address of the within named Grantee is: /oz SouFh s4f~,./.kF. sYwF, (Ylr-ekee«sbv f, PA l7oS,S; Attorney/Agent for Grantee -3- InterFlo~ot~~` wea mace www.interftood.cam • 1-804-252-6633 it Prepared for: dba Lester G. Connor, MAI 100 S i~iarket Street Mechanicsburg, PP. 17055 zae °~~ ~~1 X AE'. 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'~ a I" r ~Q~ ~i~ ~d~ 'r ~ 1 ` ~ y ti t ~ ~ "' ~ r: ~ ~l ~ " - ~ R~ 1. r i„ ^' i G ~ 4 ,~M ~ ~~` ~~~ y,,,,.M~p R ~ 2 ~' ~g ay~~ ,,,,,~ ~~ ~ ~ ~,..~ , NN i 7. ~ N~~ ~~ i r 7 ~~ I ~ a Zia a, ~, y q fi 4p ~a~~~ N a EE~.M'Nppp PVE ~ MIDDLE (27, PART 7) • PART 7 "C-N" RESIDENTIAL DISTRICT COM1ViERCIAL-NEIGHBORHOOD N N w M M N N ^ §27-701. Purpose. The Commercial-Neighborhood District is comprised of those areas in the Bomugh con- taining avariety of residential dwelling arrangements with low-intensity commercial uees. The purpose of this district is to promote a compatible combination of residential uses and retai]lprofessional trade to establish a viable urban environment which will supplement activities and uses permitted in the Central Business District and Commer• cial-General District. (Ord. 973, 3/19/1991, §701) §27-702. Permitted Uses. 1, Primary Uses. A. Single-family detached and semi-detached dwellings. B. Single-family attached dwellings. C. Two-family detached dwellings. D. Apartment conversion dwellings. E. Apartment dwellings, accessory. F. Family care facilities. G. Family day care homes. H. Group care facilities. I. Group day care homes. J. Municipal buildings, churches, public parks/playgrounds, and libraries. K. Public utility uses. L. • Medical centers. 12119!2006 27-49 ZONING M. Signs when erected and maintained in accordance with Part 16, "Signs," herein. N. Uses and buildings customarily accessory and incidental to any of the above permitted uses. O. Multi-family dwellings. P. Bed and breakfast inn, provided the building in which the use is conducted is located within the Historic District of the Borough of Mechanicsburg. (See Chapter l0A). Q. Bed and breakfast lodge, provided the building in which the use is con- ducted is located within the Historic District of the Borough of Mechanics- burg. (See Chapter l0A). R. No-impact home-based business. 2. Secondary Uaes. Commercial and office uses are permitted, based on the following provisions: A. The Standard Industrial Classification (SIC) Manual, 1972, as amended, published by the U.S. Government Printing Office, shall be the deciding ref- erence source in determining the suitability of commercial and office uses to the Commercialz-Neighborhood District. Use categories listed below are ref- erenced by their SIC Code Number. Permitted uses listed are deemed to in- clude all uses classified by the SIC Manual under the same code number. B. All commercial and office uses are limited to location on the ground floor in a multi-story building. C. Each use shall be located in a building occupied by a primary use and may not occupy more than 2,000) square feet or 40% of the building space. D. Uses shall include the following: 5IC NO. Category (I) 54 Food stores (2) 66 ' Apparel and accessory stores (3) 58 Eating and drinking places except establishments with drive-in facilities (4) 591 Drug stores and proprietary stores (6) 693 Used merchandise stores %Editor's Note: Ord. 973 read "Residential." 27-50 lzti9t2oos (27, PART 7) SIC NO. Category (6) 694 Miscellaneous shopping good stores including sporting goods, books, stationery, jewelry, hobby, toy game, photography, gift, luggage and sewing stares (7) 6992 Florists (8) 6993 Cigar stores (9) 6994 News dealers and newsstands (10) b996 Optical goods stores (11) 64 Insurance agents, brokers and service (12) 65 Rsal estate (13) 7216 Coin-ogerated laundries and cleaning (14} 722 Photographic studies, portrait (lb} 728 Beauty shop (16) 724 Barber shop (17) 725 Shoe repair (18) 731 Advertising (19) 732 Credit reporting and collecting (20) ^r33 Mailing, reproduction, stenographic (21) 7361 Employment agencies (22) 73? Computer and data pxocessing services (23) 76 Miscellaneous repair services (24) 784 Video tape rental (25) 801 Offices of physicians (26) 802 Offices of dentists (27) 803 Offices of osteopathic physicians (28) 804 Offices of other health practitioners (29) 81 Legal services (30) 83 Social services (31) 841 Museums znd art galleries (32) 86 Membership organizations (33) 891 Engineering and architectural. services (34) 893 Accounting, auditing and bookkeeping (35) 874 Management and public relations (Ord. 973, 3!19/1991, §702; as amended by Ord 1006, 11/17/1998, §10; by Ord, 1073, 9(6(2005, §4; and by Ord. 1082, 6/20/2006, §8) 12119!2006 27-51 __ m~,~~. • ZONING ~' §27-703. Height Regulationsr 1. The height of a building shall not exceed 40 feet. 2. The height of an accessory building shall not exceed 20 feet. [Ord. 1006] (Ord. 973, 3/1911991, §703; as amended by Ord. 1006, 11!17/1998, §10) §27-?04. Lot Area, Width and Coverage Regulations. 1. Lot area, width and coverage regulations shall be determined based on the pri- mary use. 2. Residential Uses. A. The minimum lot area per dwelling unit, m,n;mum lot width at the building setback line and maximum lot coverage shall be not less than that indicated below: 3. w LOT AREA! DWELLING UNIT DWELLING TYPE (square feet) Single-family de- 3,000 torched Single-family semi- 2,000 detached Single-family at- 2.000 tacked Two-family detached 3,000 Multifamily dwelling 1,500 [Ord. 1006) Apartment conver- 1,000 sion LOT WIDTHlDWELLING UNIT INTERIOR CORNER COVERAGE (feet) (feet) (%) 30 46 60 20 35 50 20 30 60 30 46 50 - - 50 - - 50 B. At least 15% of the lot area shall be maintained with a vegetative cover Nonresidential Uses. For a nonresidential use, the minimum lot standards shall be as follows: A. Lot area shall be based upon required setbacks, coverage, pazking, load- ing/unloading and other applicahle standards, but in no instance shall be less than 3,000 square feet. B. The maximum lot coverage shall not exceed 60% with at least 10% of the lot area maintained with a vegetative cover. 27-52 12/19/2000 ~~ ~.~..,.. ,_ N • (27, PART `n C. The minimum lot width measured at the building setback line for an inte- rior lot shall be not less than 30 feet, and a corner lot shall be not leas than 4b feet. (Ord. 973, 3/19/1991, §704) §27-705. Yard Regulations. Each lot shall have front, side and rear yards of not leas than the depth or width indi- cated below: A. Front Yard. The minimum front yard setback shall be determined by eatab- liahing the average setback distance of buildings constructed adjacent to each aide of the lot to be developed. In measuring such distance open, un- covered porches shall not be construed as part of the building. B. Side Yard. (1) On an interior lot, the minimum side yard shall be five feet. On a cor- ner lot, the aide yard abutting a street or alley shall be not leas than 15 feet. No side yard shall be required where structures abut one an- other, provided that a written agreement is entered into by each prop- erty owner and submitted to the Zoning Officer. I~ (2) On an interior lot, the aide yard shall be not less than five feet. On a corner lot, the aide yard abutting the street or alley shall not be less than 15 feet and the aide yard abutting the interior lot line shall not be required where buildings abut one another, provided a written agreement is entered into by each property owner and submitted to the Zoning Officer. [Ord. 1006] C. Rear Yard. The rear yard depth shall be no less than 15 feet. D. Buffer yards/screening shall be provided in accordance with Part 11, "Gen- eral Provisions," herein. E. Permitted yard reductions shall be in compliance with Part 11, "General Provisions," herein. F. For multifamily dwellings, there shall be a front yard, two side yards and a rear yard of at least 15 feet. For each story over two, five feet of width and depth shall be added to each yard. jOrd. 1006] (Ord. 973, 3/19/1991, §705; as amended by Ord. 1006, 11/17/1998, §§12, 13) I~ 12/19/2006 27-53 .. .... ~.~. ... ~v. aW4 ..Sarv.%4 • ZOI~IING §27-706. Off-Street Parking7l,oading and Unloading Access. Parking, loading and unloading facilities shall be provided in accordance with Part 14, "Off-Street Parking," and Part 16, "Motor Vehicle Access," herein. (Ord. 973, 3/19/1991, §706) (27, PART 13) PART 13 NONCONFORMING BUILDINGS AND USES All lawful uses of land or of a lot, building, sign, or other structure existing on the effec- tive date of this Chapter may be continued, altered, restored, reconstructed, changed, sold, or maintained even though such use may not confoxm to the use, height, area, yard, and other regulations of the district in which it is located, provided such noncon- forming conditions shall comply with the foAowing: §27-1301. Continuation. The Zoning Officer shall be responsible for the proper registration of premises occupied by a lawful nonconforming use, lot, building, and/or structure existing after the effective date of this Chapter and issuance of a certificate of nonconformance; which shall be for the purpose of insuring to the owner the right to continue such nonconformity in accor- dance with the provisions of this Part. It is the property owners' responsibility to assist the Zoning Officer in the identification and registration of nonconforming uses, lots, buildings, and structures they are accountable for. Periodic notice of this requirement shall be published and/or circulated by the Borough for the purpose of making property owners aware of such. (Ord. 973, 3!19/1991, §1301) §27-1302. Alterations. Repairs and structural alterations may be made to a nonconforming building or a build- ing occupied by a nonconforming use; providing such alterations and repairs are in con- formance with the regulations set forth in this Chapter and other applicable codes and ordinances adopted by the Borough. (Ord 973, 3/19/1991, §1302) §27-1303. Extensions or Enlargements. 1. The types of extensions and enlargements listed below are permitted for noncon- forming uses, buildings, and structures existing on the effective date of this Chap- ter: A. The extension o£ a nonconforming use of land upon a lot occupied by such use. B. The extension or enlargement of a conforming building occupied by a non- conforming use. 12120!2006 27-133 • ZONING ... C. The extension or enlargement of a nonconforming building occupied by a nonconforming use. --- D, The extension or enlargement of a nonconforming building occupied by a conforming use. __~ 2. The foregoing extensions or enlargements of such nonconforming buildings or uses shall be subject to the following conditions: A The extension or enlargement shall conform to the height, area, yard, and coverage regulations of the district in which it is located. Where a building or structure is nonconforming as to a required front, side or rear yard set- back, the established nonconforming setback may be continued, so long as the proposed extension or enlargement does not project further into ax~y yard, whether front, aide or rear yard, than the original building line ex- tended. B. The entire building or use shall be provided with off-street parking and loading spaces as required by Part 14, "Off-Street Parking," herein. C. The extension or enlargement does not replace a conforming use. D. The extension or enlargement of a building used for a nonconforming use shall not be permitted to extend into vacant parcels of land adjacent to the initial parcel of land existing and occupied on the effective date of this Chapter, where such vacant parcels have been recorded separately or ac- quired following the effective date of this Chapter. (Ord 973, 3/19/1991, §1303) §27-1304. Chances in Nonconforming Uses. A nonconforming use may be changed to another nonconforming use of the same or more restricted classification. Whenever a nonconforming use has been changed to a more restricted classif-ication or to a conforming use, such use shall not thereafter be changed to a use of less restricted classification. (Ord. 973, 3/19/1991, §1304) §27-1305. ReconstructionlRestoration. A nonconforming structure, building, or use which is damaged by fire, explosion, wind- storm or other natural or criminal acts, may be reconstructed and used for the same purposes, provided that: i~ 27-134 isisazoos ~~~~ ___ -; - (27, PART 13) _w, --~ A. The reconstruction and/or restoration of the building or structure i8 com- menced within one year from the date of occurrence of the damage and is '''. carried to completion without undue delay. B. The reconstructed building, structure or occupied area does not exceed the height, area, and volume of the original building, structure and occupied area. C. The remains of any such buildings, structures, or other improvements so destroyed shall be removed from the premises within six months so that the same shall not remain as a nuisance or safety hazaxd. (Urd. 973, 3!19!1991, §1305) ~ §27-1306. Discontinuance. If a nonconforming use of land or building ceases operations for a continuous period of more than 18 months, then such use and any subsequent use of land or building shall conform to the provisions of this Chapter, except when the discontinuance is due to a death and administration of the decedent's estate, in which event the discontinuance shall not be presumed to start until estate administration is terminated or a court order concerning the disposition of the estate has been entered. _ ~ (Urd. 973, 3119/1991, §1306) §27-1307. Nonconforming Signs. Signs in existence at the effective date of this Chapter, or amendments hereto, may be continued subject to the regulations contained in §27.1305, above, and in Part 15, "$igns," herein. (Urd. 973, 3/1911991, §1307) §27-1308. District Chances. Whenever the boundaries or uses of a district shall be changed the foregoing provisions shall also apply to any nonconforming lots, uses, or buildings existing therein or created thereby. (Ord 973, 3/19/1991, §1308) i2~2a2oos 27-136 ~. (27, PART 14) PART 14 OFF-STREET PARKING §27-1401. General Parking Regulations. 1. Off-street parking facilities shall be provided to lessen congestion in the streets. The facilities required herein shall be available to patrons throughout the hours of operation of the particular business or use for which such facilities are provided. As used herein, the term "parking space" includes either covered garage space or uncovered parking apace located off the public right-of--way. 2. Parking spaces and the approaches thereto shall be stone, gravel, paved surface or ^ other suitable materials as approved by the Borough Engineer. Outdoor parking ^ spaces shall be deemed to be part of the open space of the lot on which it is lo• Gated. [Ord. 1006] 3. A garage or carport may be located wholly or partly inside the walls of the princi• pal building, or attached to the outer walls. If separated from the principal build- 1 ing, the garage shall conform to all accessory building requirements. The garage may be constructed under a yard provided that the level of such yard shall con• form to the general level of the other yards on the lot. The space above an under- ground garage shall be deemed to be part of the open space of the lot on which it is located. 4. All commercial, public, institutional, and industrial uses shall provide a m;n;muIn of one handicapped parking space or 5% of the parking spaces required, which- ever, is greater, the design to be approved by the Borough Engineer. 5. No part of any front yard in a residential district, other than the driveway area, shall be used for parking purposes. 6. The parking of any non motorized vehicle (including boats and trailers) or any mo- torized vehicle not having a current and valid registration and inspection certifi• Gate is prohibited within any street or alley right-of--way. (Ord. 973, 3/19/1991, §1401; as amended by Ord. 1006, 11/17/1998, §17) §27-1402. Facilities Required. Any of the following facilities hereafter erected or enlarged and any facility hereafter converted into one of the following facilities and any open area hereafter used shall be provided with nat less than the minimum parking spaces as set forth below, together with adequate access ways, driveways or other means of circulation and access to and from a street. 1211ai2oos 27-137 ZONING OFF-STREET PARKING SPACE REQUIREMENTS Uses Required Parking Spaces 1. Automotive Sales and Service Garages 1 pazking apace for each 300 aq. ft. of floor area devoted to service facilities or 2 spaces for each service bay whichever is greater, plus 1 space for each 200 sq. ft. of floor area devoted to Bales faalities or usage plus 1 apace for eachfull-time employee 2. Automobile Wash 6 for each washing machine 3. Banks or Professional Offices, other than Medical Offices 4. Bowling Centers b. Dance Halls, Swimming Pools, Roller Rinks, Clubs, Lodges, and other similar uses 5.1 Doctor's Offices 1 space for each 200 sq. ft. of floor area 6 spaces for each lane 1 apace for each 100 sq. ft. of floor area or of surface water area in swimming pool 6 spaces for each physician, dentist, physical therapist, pharmacist, optometrist, or other health care profes- sional 6. Elderly Housing (Multi•Family Dwel]ings) 7. Family Care and Group Care Faillitaes 8. Family Day Care and Group Day Care Homes 9. Food Markets and Convenience Stores 10. Funeral Homes, Mortuaries 11. Furniture or Appliance Storrs 12. Home Occupations 13. Hospitals, Nursing and Convalescent Homes 14. Hotels, Motels, Boarding and Lodging/Rooming Houses, bed and Breakfast Establishments 15. Industrial Uses (mills, manufacturing or assembly plants, laboratories, salvage Yards, etc.) [Ord. 994] 16. Medical Centers/Offices 17. Multiple Dwellings 18. Nursery Schools (Day Care Centers) 19. Places of public or private Assembly (churches, community centers, theaters, or similar meeting and assembly uses) .5 (1/2) spaces per dwelling unit 1. space for every 2 residents plus 1 space for each em- ployee in the maximum working shift 1 space for each nonresident employee plus 1 space fnr passenger loadinglunloadingpar 4 nonresident children 1 space fox each 200 sq. ft. of floor area 1 parking space for each b0 square feet of floor area far use of memorial services, viewing area, business office and products display 1 apace for each 1,000 sq. ft. of floor area 1 space per 150 square feet or part thereof of floor area used for home occupation in addition to the requirement. for the dwelling unit 1 apace for every 3 beds, glue 1 space for each 2 employ- ees in the maximum working sluff plus 1 space for each staff doctor, on the maximum working shift 1 space for each guest room plus 1 apace for each 2 em- ployees in the working shift 1 apace for each 1,000 sq. ft. of floor area, plus 1 apace for each, 2 employees in the maximum working shift. The total parking area shall not be less than 25% of the floor area 1 space for every 200 square feet of floor area 1.6 spaces per dwelling unit 1 space for each employee and 1 space for passenger loading/unloading per 4 children 1 space for every 4 seats or 1 space for each 100 sq. ft. of floor area where no seats are provided 27-138 iz/1s/loos (27, PART 14) Uses 20. Restaurants, Tea Rooms, Taverns, and Nightclubs Required Parking Spaces 1 space for every 2 seats 21. Retail Stores and Shops 22. Schools [Ord. 1013] 23. Single and Two•Family Dwellings 24. Utility or Communication Station 26. Warehouse/Distribution 1 space for each 200 sq. ft. of floor area 1 apace per 15 students in the elementary school build• ing plus 1 space for each employee working in the high school building. 1 space per 2.5 students in the high school building plus 1 space for each employee working in the high school building. 1 space per 10 students in other school buildings plus 1 space for each employee working in the other school buildings. The term "employee" as used herein shall include teach- ers, staff members and eeroice members The term "student" as used herein shall be based on mar;mum allowable student capacity 2 spaces per dwelling unit 2 space pez vehicle normally required to service such facility 1 space for each. warehouse employee working in the maximum employee working shift and 1 space for each. 200 square feet of office area [Ord. 994[ (Ord. 973, 3/19/1991, §1402; as amended by Ord. 994, 3!19/1996, §§2, 3; by Ord. 1013, 12/21/1999, §1; by Ord. 1070, 6/7/2005, §3; and by Ord. 1080, 6/6/2006, §2) §27-1403. Location and NTanagement Requirements. Existing Parking. Buildings and uses existing on the effective date of this Chapter shall not be subject to the requirements of this Part so long as the type or extent of use is not changed, provided that any parking facility now serving such struc- tures or uses shall not in the future be reduced below such requirements. Changes in Requirements. Whenever there is an alteration of a building or a change or extension of a use which increases the parking requirements according to the standards, the total additional parking required for the alteration, change or extension shall. be provided in accordance with the requirements of that Sec- tion. 3. Conflict With Other Uses. No parking area shall be used for ax~y use that inter- feres with its availability for the parking need it is required to serve. 4. Continuing Obligation. All required parking facilities shall be provided and main- tained so long as the use exists which the facilities were designed to serve. Off- street parking facilities shall not be reduced in total extent after their provision. Reasonable precautions are to be taken by the owner or sponsor of particular uses to assure the availability of required facilities for the employees or other persons 12/19/2006 27-139 ZONING whom the facilities are designed to serve. They shall at no time constitute a nui- sance, hazard or unreasonable impediment to traffic. 5. Drainage, Surfacing and Maintenance. A. The area of pazking lots, including driveways, shall be graded, surfaced with asphalt or other suitable material, and drained in accordance with other applicable codes and ordinances enacted by the Borough, and ap- proved by the Borough Engineer. B. Parking areas shall be kept clean and free from rubbish and debris. C. In all cases, such drainage, surfacing, and maintenance activities and plena shall conform to other applicable codes and ordinances enacted by the Bor- ough. 6. Joint Use. Two or more uses may provide for required parking in a common pazk- ing lot, if the total space provided is not less than the sum of the spaces required for each use individually. Computation of Spaces. Where the computation of required parking space results in a fractional number, any fraction shall be wunted as one. 8. Location of Spaces. A. Single and two-family residential off-street parking spaces shall be provided on the same lot or premises with the use served. B. Parking spaces for multiple dwelling buildings, commercial, industrial, and other uses shall be readily accessible to the buildings served thereby. Such spaces shall be in the same zoning district as the principal building, or open area, and conform to the following regulations. (1) The required parking spaces shall be located within 600 feet of the principal building or open space in question. (2) .The applicant for a use or building permit shall submit with his appli- cation an instrument duly executed and acknowledged which subjects such parcels of land to parking uses in connection with the principal use to which it is accessory. Upon issuance of a permit, the Zoning Of- ficer shall cause such instrument to be recorded in the office of the Re- corder of Deeds. (3) Uses, other than residential, located within a 600 foot radius of the municipal parking lot located on the north side of Strawberry Alley may include the spaces provided in said municipal parking lot as a part of the off-street parking requirement. [Ord. 1006] 27-140 i2/ia/coos (27, PART 14) 9. Lighting. A. All public parking areas shall be adequately lighted during after dark oper- ating hours. B. Any lighting used to illuminate off-street parking or loading areas shall be shielded from any street or residential use. .(Ord 973, 3/19/1991, §1403; as amended by Ord. 1006, 11/1/7/1998, §18) §27-1404. Design Standards. 1. The minimum dimensions ofpazking facilities to be provided shall be as follows: A. In all districts parking spaces per vehicle shall be not less than nine feet wide and one feet long. B. Parking lot dimensions shall be not less than those listed in the following table. Angle of Parking 90 degrees 60 degrees 46 degrees 30 degrees _ Parallel Parking Stall Width Stall Depth" 9' 18' 10' 22' 10' 21' 10' 19' 8' 22' Aisle Width One-Way Two-Way 24' 24' 18' 20'8 15' 20' 12' 20' 12' 20' * Depth of stall is the perpendicular measurement from curb or edge of the parking lot toward the interior portion of the lot to be occupied by the park- ing vehicles and not including any part of the drive. C. All dead end parking lots shall be designed to provide sufficient back-up ' area for the end stalls of the parking azea. D. Pazking'areas shall be designed so that each motor vehicle may proceed to and from the parking space provided for it without requiring the moving of any other motor vehicle. E, Where more than 10 parking spaces are required, a maximum of 40% of the parking spaces may be provided for compact vehicles. Each such compact parking space shall be not leas than eight feet wide by 17 feet long. All com- pact parking spaces shall be located in the same area and be~marked to in- dicate spaces designated for compact parking. 12/19/2000 27-141 ZONING 2. Setback for parking areas shall be provided as follows: A. All parking spaces and access drives shall be located at least five feet from any multiple dwelling building, office, commercial, institutional, industrial, and other similar non-residential buildings located on the lot. The five foot corridor thus established between the parking area and building shall be for the purpose of providing a pedestrian access walkway. B. All parking spaces and access drives shall be at least five feet from any ex- terior lot line, except where buffer yards are required, in which case such parking spaces may not encroach on the buffer yard area. C. No off-street parking area shall be located within a public right-of--way. 3. Separation. A. Except at entrance and exit drives; parking areas shall be physically sepa- rated from any public and/or private streets by a minimum five foot planting strip. B. In na case shall parking areas be designed to require or encourage cars to back into a public or private street in order to leave the parking areas. C. All paved off-street parking spaces shall be marked so as to indicate their location. D. Unless deemed unnecessary by the Borough Engineer, pedestrian cros~- walks and landscaped refuge islands to separate the parking spaces from the exit, entrance, and circulatory drives shall be provided for and. approved by the Borough Engineer. Such landscaped areas may be considered as part of the vegetative coverage requirements set forth in the applicable zoning district provisions or as provided elsewhere in this Chapter. 4. Buffer Yards. Buffer yards and screening shall be required for parking lots for six or more vehicles located on a lot adjacent to a residential use and shall be gro- vided on each side which faces a residential use. Such buffer yard and screening shall be in accordance with buffer yard standards set forth in Part 11, "Genera]. Provisions." herein. 5. Curb Radius. No leas than a five foot radius of curvature shall be permitted for all curb lines in all parking lots. (Ord. 973, 3/19/1991, §1404) $27-1405..Off,Street Loading and Unloading. 1. Required Berths and Spaces. 27-142 12/19/2006 __ _ ~ _ __ • (27, PART 14) A. In addition to the off-street parking requirements set forth herein, any building erected, converted, or enlarged for commercial, office, manufactur- ing, institutional, hospital, or other similar uses requiring the delivery or pick up of products or materials shall provide adequate off-street areas for the loading and unloading of vehicles. Such areas shall be provided for as follows: Gross Floor Area In Use Square Feet Humber of Spaees Commam;at wholesale manufactur• Under 8,000 1 ing, hospitals laundry, institutional, and similar urea 8,000 to 4QD00 2 over 40,000 to 100,000 3 wer 100,OD0 to 260,000 4 each additiona1200,000 1 Office buildings and hotels Under 100,000 1 over 100,000 to 30Q000 2 over30Q000 3 B. All off-street loading and unloading areas shall be provided and maintained so long as the use exists which the facilities were designed to serve. 2. Design Standards. Off-street loading facilities shall be designed to conform to the following specifications: A Each required berth shall be not less than 12 feet in width, 45 feet in length and 14 feet in height, exclusive of drives and maneuvering space and located entirely on the lot being served. B. There shall be appropriate means of access to a street or alley, as well as adequate maneuvering apace. C. The maximum width of the driveways and sidewalk openings measured at the street lot line shall be 40 feet; the minimum width shall be 20 feet. D. A11 accessory driveways and entrance ways shall be graded, surfaced and dxained in accordance applicable codes and ordinances of Mechanicsbuxg Borough (Ord. 973, 3!19/1991, §1405} 1211ai2oos 27-143 R~NTALAGREEMENT THIS AGREEMENT, dated the i~t day of Air ,~oo~, is by and between Clvde Wziehtstone LANDLORD, and Susan Kiskis TENANT for rental of the property located at 102 South Market Street BOrO/TOWnSilip Of Mechanicsbure ,PA. COUnty Of Cumberland ,Pennsylvania, under the following terms and conditions: TERM: The TENANT agrees to tease this dwelling on a month to month basis with continuance, to be decided between the LANDLORb or TENANT by the 5th of each month for the next month beginning on the 1st day of~r,,~ ,.20~~ , RENT: The TENANT agrees to rent the dwelling for the sum of s~oo.oo dollars per month. Monthly rent is due by the 1st (FIRST) day of each month. If the rent is not paid by the 5th of the month, there will be a 5% late fee that will be compounded daily until the total amount is paid and the lease will not be renewed for the next month. If eviction proceedings are started without cooperation, ail costs are to be paid by the TENANT. Monthly rent is expected to be paid by cash, check or money order to r., ~„IP LIY; gt,r.crnnP at ino Cn„th Ma rkPt StrPPt . The TENANT agrees to pay $30.00 to the LANDLORD for any bounced check. If the LANDLORD has to contact the tenant more than twice to set up rent collection, the lease will not be renewed for the next month., The LANDLORD acknowledges the receipt of $ for rent. OCCUPANT: The number of occupants is limited to ~.. Only the following n/a person(s} may. live in this dwelling. „/, No one else may live there without the LANDLORDS written permission. Additional persons = $ n/a per month per person. SUBLETTING AND ASSIGNMENT: TENANT shall not sublet the entire premises or any: part of the premises, nor shaft they assign this agreement to anyone else without first obtaining the LANDLORD'S .written permission. UTILITIES/TENANT MAINTENANCE: TENANT to pay for electric; cable, and telephone. The TENANT is responsible for snow/ice ' TENANTS INITIALS J'~ N"" removal (including sidewalks, steps, patios and decks) and yard maintenance. The TENANT [s responsible for minor maintenance items costing less than $~s_no including but not limited to faucet repairs, minor plumbing repairs, stove burners and alt light bulbs (Including fluorescent light bulbs). . APPLIANCES: There may. be appliances in the dwelling, such as a refrigerator, stove, dishwasher, washer or dryer. If the TENANT wishes to use these appfiances, TENANT agrees to assume all responsibility for care and maintenance. TENANT INSPECTION: TENANT has inspected the dwelling and it`s contents and agrees that they are in satisfactory order, as are the electrical, plumbing and heating systems. NOTIFICATION OF BUILDING PROBLEMS: TENANT agrees to notify the LANDLORD immediately upon first discovering any signs of serious building problems such as a crack in the foundation, a tilting porch, a crack in the plaster or brick, moisture in the ceiling, a leaky roof, a spongy floor, a leaky water heater or termite activity. REASONABLE TIME FOR REPAIRS: Upon being notified by TENANT that there is some building defect which is hazardous to life, tteaith or safety, the LANDLORD shall undertake repairs as soon as possible. Should there be a decay of more than 72 hours in making the repair for any reason beyond the ZANDLORD'S control, the LANDLORD agrees to keep TENANT informed about the process of the work. VEHICLES: ~arh TENANT agrees to keep a rriaximllm of n /a vehicle(s) on the premises. Vehicle(s) must.be operable and currently iicensedJinspected. Parking for this property located' on street TENANT agrees not to park boats, recreational trailers, utility trailers and the like on the premises without first obtaining LANDLORD'S written permission. WINDOWS: Except for those windows which are noted in writing as being damaged when the TENANT moves in, TENANT agrees to be responsible for any windows which become cracked or broken in their dwelling while the TENANT lives there. TENANT to maintain/replace all window coverings provided by LANDLORD. If not provided, TENANT agrees to install white pull down shades. - TENANTS INITIALS ~ v_ t1>AMAGE: TENANT•a.grees to pay for repairs of all damage which 'TENANT or their guest(s) have caused. DRAIN STOPPAGES: as of the date of this agreement, LANDLORD warrants that the dwelling's sewage drains are in good working order and that sewage drains will accept the normal household waste for which they were designed. Sewage drains viii not accept things like paper diapers, sanitary napkins, paper towels, tampons, children's toys, wads of toilet paper, bails of hair, grease, oil, paint products, table scraps, cinching, rags, sand, dirt, rocks or newspaper.. TENANT agrees to pay for clearing the pipes of any and all stoppages except those which the plumber who is called to clear the stoppage wilt attest to in writing were caused by defective plumbing, tree roots or acts of God. TRASH: TENANT agrees to dispose of their ordinary household trash by placing it into, proper receptacles. TENANT agrees to dispose of their extraordinary household trash such as Christmas trees, damaged furniture, broken appliances and the like, by compacting it so that it fits inside their trash receptacle or by hauling it to the dump themselves or by paying someone to haul it away. TENANT agrees to provide trash receptacles (cans) as needed. ACCESS: LANDLORD recognizes that TENANT has the right to privacy. At certain times however, LANDLORD or those employed by them may have to gair± access to the TENANT'S. dwelling. There will be every attempt made to contact TENANT prior to access to the dwelling but if attempts to make contact are unsuccessful, the LANDLORD has the right to gain access to th2 .property. TELEAHONE: If and when TENANT installs telepfione services in the dwelling or changes existing phone number, TENANT will furnish LANDLORD with the number within five calendar days: PEACE AND QUIET: TENANT is entitled to the quiet enjoyment of their own dwelling, and their neighbors are entitled to the same. TENANT agrees to refrain from making -noises ertd disturbances and to keep down the voiune of their music and broadcast programs at all times so as not to disturb other peoples' peace and quiet. BUSINESS USE: TENANT.,agrees to use this dwelling as their {iersonat residence.. TENANT agrees to conduct no bu[s`ines~s on the TENANTS INITIALS ~"" i premises without first obtaining LANDLORD'S written permission. ' INSURANCE: LANDLORD has obtained insurance to cover fire damage to the building itself. LANDLORD'$ insurance does not cover TENANT'S possessions Or TENANT'S negligence. It is the TENANT'S responsibility to obtain renters insurance to cover any incidental losses. TENAi!11T agrees that they will do nothing to the premises nor keep anything on the premises which could result in an increase in the LANDLORD'S insurance policy or an endangering of the premises. Neither witJ the TENANT allow anyone eJ.sQ to do so. Np rights of storage are given by this lease, and the LANDLORD shall not be liable for any loss of property by fire, theft, burglary or otherwise from said premises or building, nor any accidental damage to persons or property in or about the rented premises or building by any cause. The TENANT agrees to make no claim for any such foss or damage. TENANT acknowledges that TENANT has been advised of the TENANTS obligation to obtain insurance. LAWFUL USE: TENANT agrees that they will not themselves engage in any illegal activities on the premises, nor will TENANT allow others to engage in any illegal activities on the premises.. YACATINf3: When Y'ENANT vacates, carpets are to be cleaned by a professional cleaner, not a rented machine.- TENANT will remove all rubbish and garbage, and will clean the premises and appliances ar~d .wilt insure aJJ appliances, electrical, plumbing and heating systerr:s are in good working order prior to vacating the premises. The keys must be returned on the f'inai day of occupancy. If the dwelling is not in the same condition as nn the move in date, a taiU inriJi be sent to the tenant with payment expected within 30 days of receipt. CONDITION: The dweliin.g and all of the furnishings and appliances therein are accepted as in good condition, provided, however, that if TENANT shall find anything not in good condition, or that the inventory in the house report is incorrect in any way, a written statement of any objections shall be delivered to the LANDLORD within three (3j days after. taking possession. Qtherwise, it w[Il be presumed that the inventory is correct. #?ETS: TENANT is not permitted to have pets of any kind without written permission from the LANDLORD and possible increase in monthly rent. Exception to this is a fish tank. TENANTS INITIALS i4GREES TO IT AND HAS BEEN GIVEN A COPY OF iT. '- TENANT(5 LANDLORD '^`'^B~TO~ ~ TAX PAYEq COPY 8111 No: 8345 ARRY L HECICARb SR -~ Control No: 016-000054 80550MERSET DRIVE 717488.6205 ' MECFIANICSBURG, PA 17055 oedce~marv A~S5 1O • .16000054 ~MAP•NO:• 16-23.0685.057 5 W LOCUST STREET ACRES - .210 DEED 00272 / LAND LESS THAN 1 ACRE 2008 StetemeM of Rau l Estrts Taxes BIII Date: 7/01/2008 Assesae Land Iwprovemant Miaeral Total Values 64 330 260 900 0 325 230 MECHANIC88URA AREA 5.0. Dieaount Faee pens Rates 13.73000 13.73000 13.73000 2 lp} sCHOOi R E 883.25 3 582.16 ~ 4 376.10 4 465,41 4 911.95 TAX AMOUNT DUE -> ~ ta,aTS.~o sa,46s.41 s4,w~.es 02047 21 Paid Oa os ALGr 7 O1 008 Ol 200 11 Ol 2 OB I! Paid Oa or e~iora 8 31 2008 10 31 2008 12 31 2008 ^ Commercltll • Combination ^ COMMERCIAL • COMBINATION it AO FEE FOR EXTRA TAX. BILL T^x r^ven CASH ONLY'AFTER ]2!75/08 WRI0IHTSTONE, CLYDE RETUHNBILL WRHPXYMENT, ENCLOSE SELFADbRESS STAMP ENV. 102 1/2 SOUTH MARKET sTREEr - IF TAXES ARE IN~ ESCROW, FORWARD BILL TO MORT. CO. MECHANICSBURG PA 17055 o'rice roues ^~ 7[7L4f7IUG3110-4PM (vt.J C?, ~ ~-(~~ SEPT-DEC TUESDAY 10.4PM O OR YOU MAY CALL FOR APPi. CLOSED AUG 4-8 ELECT DAY & HOLI. RETAIN TAX PAYERS COPY FOR YOUR RECORDS i 1 -- ---~ ,----; - -, L ---- __ ---- ------I I---J -" -~ ~ ~ l__~ i Ji -_ ~ ~.. .. AORY'(aA~i"~/l.`O OA5kj`.F'S1VL'lY'..AFe~I',"~"'YY4$Y6~~~~- ~YAaIE -. n,. .. ~. . '~~ ~1 BA'FIRY'1,19ECk~pE1~1 TAX CdL~ECTOft p 6RSBOMEF,75&r`~~pIVP N1EC1$g1~ICSBUPIG FA 1 ,: 155 ~ 2:~ic o AS,SES¢rfil0 ,TSOb(1054 tYAP~O 3~'2',i-0585fl5~ 'W,1L'°O,CUS~'S',~~iEEf ~ ~~~ ~ I GRES ;.?,~10 [),EEfsX; Op2>?0~0~"~ s ^3. 'F~1a 'L`AY"7D,v'Ya~$Sa,TH~N 7.~0„~E ~~~r .cx~ ' " " ~_p ~t+Ypr~. s~~ l libirime9 o7~f+~GBm~n atl~n " ,fi ~ OpIv1147E~iCigL~.Gt3MB11~~T~1Gf~' B~rRf~I' ~1ECkC~~f TrAX,~,~LLt~'i°8#~ z VJR1CtH7+S~TiG"Bf*!E CLYI$'E ~i}~'I~a~'S~3I~R~Y,, •es 1:0~:772'SO 1;{~~1gRKEfT~1`ERE~ MECRAAi ~ `" IC eUR~ ~A 17155 ioe MAR gPfi ~`UESt&S.~JUR'S%a1'Dgkl.4pryl s CLS~~ECTUES°.~.OA'Ii~JAyP.M, " ~i 6;7ByB ELECaTIbr~ n~„~ °~ 1=1rJC'ID`A~i'5~..1-(ONE?~y777:6~.8~'05• -~ , 1 ~' M ~ ~ ~ / \ } , ~, ror. N 'r-', 328+i 104 1,o73.as RENTAL AGREEMENT • THiS AGREEMENT,. dated the ,, a* day of ~ ,s ,.Z~Z, is by and between r.,~~e ~n Q .°n LANDLORD, and M; ~,,aet T TENANT for rental of the property located at 5 West Locust St. (2nd Elo~gro/Township of ~.~~+=++;~a~•+,-~ va , County of cumberi8°a , •Pennsylvanfa, under the following terms and conditions: TERM: The TENANT agrees to tease this dwefiing '=~~n 1•<°°xte) veer ~. :,: with continuance. to be decided between the LANDLORD or TENANT by the 5th of each month for the next month beginning on the , ~* day of,~„d„-,r-,20 na . RENT: The TENANT agrees to rent the dwelling for the sum of ssso.oo dollars per month: Monthly rent is due by the 1st (FIRST) day of each month. If the rent is not paid by the 5th of the month, there will be a 5% late fee that will be compounded daily until the total amount is paid and the lease will not be renewed for the next month. If eviction proceedings are started without cooperation, all costs are to be paid by the TENANT. Monthly rent 'ss expected to be paid by cash, check or money order to.Clvae wri~~;4tone at goo S. Mar7cet Street M=,,a.,; ~_ h.,_a_p, The TENANT agrees to pay $30.00 to the LANDLORD for any bounced check. If the LANDLORD has to contact the tenant more than twice to setup rent collection; the lease will not be renewed for the n..cxt, month. The LANDLORD acknowledges the receipt of $SSO.o~ for nngusc rent. OCCUPANT: The number of occupants is limited to , _. Only the .following 1 person(s) may live in this dwelling Michael Turner No one else may live there without the LANDLORDS written permission. Additioriai persons = $ N/A per month per person. SUBLETTING AND ASSIGNMENT: TENANT shall not sublet the entire premises or any, part of the premises, nor shad they assign this agreement to anyone else without first obtaining. the LANDLORD'S .written permission. . .UTILITIES/TENANT MAINTENANCE: TENANT to pay for electric, cable, and telephone. =' -- _ = ° _- - TENANTS INITIALS ~~~ • • • -. The TENANT is responsible for minor maintenance items costing less than $ ~.~..,,, including but not limited to faucet repairs, minor plumbing repairs, stove burners and all fight bulbs (including fluorescent light bulbs). APPLIANCES: There may be appliances in the dwelling, such as a refrigerator, stove, dishwasher, washer or dryer. If the TENANT wishes to use these appliances, TENANT agrees to assume all responsibility for care and maintenance. TENANT INSPECTION: TENANT has inspected the dwelling and it's contents and agrees that they are in satisfactory order, as are the electrical, plumbing and heating systems. NOTIFICATION OF BUILDING PROBLEMS: TENANT agrees to notify the LANDLORD immediately upon first discovering any signs of serious building problems such as a crack in the foundation, a tilting porch, a crack in the plaster or brick, moisture in the ceiling, a leaky roof, a spongy floor, a Peaky water heater or termite activity. REASONABLE TIME FOR REPAIRS: Upon being notified by TENANT ghat there is some buiidirig defect which is hazardous to life, health or safety, the LANDLORD shall undertake repairs as soon as possible. Should there be a delay of more than 72 hours in making the repair for any reason beyond the LANDLORD'S control, the LANDLORD agrees to keep TENANT informed about the process of-the work. VEHICLES: Each TENANT agrees to keep a maximum of _L vehicle(s) on the premises. Vehicle(s) must be operable and currently licensed/inspected. Parking for this property iacated ar ~; aP ~f nrniPT~y, TENANT agrees not to park boats, recreational trailers, utility trailers and the Pike on the premises without first obtaining LANDLORD'S written permission. WINDOWS: Except for. those windows which are noted in writing as being damaged when the TENANT moves in, TENANT agrees to be responsible for any windows which become cracked or broken in their dweliing white the TENANT fives there. TENANT to maintain/replace all window coverings provided by LANDLORD.. If not provided, TENANT agrees to install white pull down shades. TENANTS INITIALS ~1i1~ ~pAMAGE: TENANT agrees to pay for repairs of all damage which 'T'ENANT or their guest(s) have caused. DRAIN STOPPAGES: as of the date of this agreement, LANDLORD warrants that the dwelling's sewage drains are in good working order and that sewage drains will accept the normal household waste for which they were designed. Sewage dralns wil{ not accept things {lice paper diapers, sanitary napkins, paper towels, tampons, children's toys, wads of toilet paper, balls of hair, grease, oil, paint products, table scraps, clothing, rags, sand, dirt, rocks or newspaper.. TENANT agrees to pay for clearing the pipes of any and ail stoppages except those which the plumber who is called to clear the stoppage wilt attest to in writing were caused by defective plumbing, tree roots or acts of God. TRASH: TENANT agrees to dispose oftheir ordinary household trash by placing'!t into proper receptacles. TENANT agrees to dispose of their extraard'snary househatd trash such as Christmas trees, damaged furniture, broken appliances and the like, by compacting it so that it fits inside their trash receptac{e or by hauling it to the dump themselves or by paying someone.to haul it away. TENANT agrees to provide trash receptacles (cans) as needed. ACCESS: LANDLORD recognizes that TENANT has the right to privacy. At certain times hpwever, LANDLORD or those employed by tl3er» tray have to gain access to the TENANT'S. rlwe!!ing. There w!!! be every attempt made'to contact TENANT prior to access to the dwelling but if attempts to make contact are unsuccessful, the LANDLORD has the right tD gain access t0l:tie property. TELEPHONE: If and when TENANT installs telephone services in the dwelling or changes existing-phone number, TENANT will furnish LANDLORD with the number within five calendar days: PEACE AND QUIET: TENANT is entitled to the quiet enjoyment of their own dwelling, and their neighbors are entitled to the same. '['ENANT agrees to refrain from making •natses and disturbances and to keep down the volume of their music and broadcast programs at all, times so as not to disturb other peoples' peaee.and quiet. BUSINESS USE: TENANT..agrees to use this- dwelling as their persona! residence.. TfN~INT agrees bJ conduct no business on the TENANTS INITIALS. M Iremises without first obtaining LANDLORD'S written permission. INSURANCE: LANDLORD has obtained insurance to cover fire damage to the building itself. LANDLORD'S insurance does not cover 3€NANT'S possessions or TENANT'S negligence. It is the TENANT'S responsibility to obtain renters 'insurance to cover any incidental losses. TENAAiT agrees that they wit) do nothing to the premises nor keep anything on the premises which could.. result in an increase in the LANDLORD'S insurance policy or an endangering of the premises. Neither will the TENANT allow anypne else tp do .sa. Na rights of storage are given by this lease, and the LANDLORD shall not be liable for any lass of property by fitre, theft, burglary or otherwise from said premises or building, nor any accidental damage to persons or property in or about the rented premises or building by any cause. The TENANT agrees to make no claim for any such floss or damage. TENANT acknowledges that TENANT has been advised of the TENANTS obligation to obtain insurance. LAWFUL USE: TENANT agrees that they will not themselves engage in any liiegai activities on the premises, nor.wili TENANT allow others to engage in any illegal activities on,the premises. 'VACATING: When TENANT vacates, carpets are to be cleaned by a professional cleaner, not a rented machine. TENANT will remove ail rubbish and garbage, and wi(I clean the premises and appliances anal. ,will insure all appliances, Nectrical, plurnbing.and heating systerr~s are 4n good working order prior to vacating the premises. The keys must be returned on the final day of occupancy. If the dwelling is not in the same conditipn as nri th>? move Jn date, a bill flail) be sent to the. tenant with payment expected within 30 days of receipt. COMDiTiON: The dwelling and all of the furnishings and appliances therein are accepted as in good condition, provided, however, that if TENANT sha44 find anything not in good condition, or that the inventory in the house report is incorrect in any way, a written statement of any objections shall be delivered to the LANDLORb yaithiri three (3} days after taking possession: Qtherwise, 4t wilt be presumed that the Prtventory is correct. BETS: TENANT is not permitted to have pets of any kind without written permission from the LANDLORD and possible increase in . RTORthiy r~eRt. i=XCeptiOR t0 ttti5 iS d fish tank. . TENANTS INITIALS ~_ • INVENTORY: The fottowing personal property is inventoried as property of the LANDLORD'S: ~- StnvP 2 Wachor ~ T~v_cr 4xPfr;gPrA*~~ 6. 7 S 9 10 COMMON USE AREAS: STORAGE: RECYCLING:' HOLDING OVER: It is fiurther agreed that the terms and conditions oJ• this agreement and lease shaft in no way be .changed or altered except in writing signed by ai! persons signing this agreement. NON-WAIVER: Should LANDLORD waive rights to enforce any breach of this agreement, that waiver shall be considered temporary and not a continuing waiver of any later tsreach. Although LANDLORD may know when accepting rent that TENANT is violating one or more of this agreement's condition, LANDLORD in accepting the rent is in no way waiving the right to enforce the breach. ENTIRE AGREEMENT: AS written, ibis agreement rAnstitUtes tine .entire agreement between the TENANT and the LANDLORD. TENANT and LANDLORD. have made no further promises of any kind to one another, nor have, the TENANT and LANDLGlFiD reached ar;y other understanding, either verbal or written. CONSEQLIIENCF.S: Violation of any part of this agreement. or nonpayment of rent when due shat! be cause'for eviction under appropriate sections of the applicable code.. ,NOTICE TO PARTIES: WHEN SIGNED THIS AGREEMENT IS A BINDING CONTRACT.' RETURN OF THIS AGREEMENT BEARING THE SIGNATURES OF ALL PARTIES CONSTITUTES ACCEIPTANCE OF THIS AGREEMENT. PARTIES TO THIS AGREEMENT ARE ADVISED TO CONSl1LT AN ATTORNEY BEFORE SIGNING IF THEY DESIRE LEGAL ADVICE.. ACKNOWLEDGMENT: TENANT HEREBY ACKNOWLEDGES THAT .TENANT HAS READ THIS..AGREEMENT, UNDERSTANDS IT, TENANTS INITIALS .. '` ~"' GIyEN A COPY D~ ~. RBES TO IT AND HAS BEEN ~~ .,~ i M ~1 M REV-15oa EX+(&aB) COMMONuVFALTH OF PENNSYLVANIA INHERRANCE TAX RETURN • SCHEDULE C CLOSELY-HELD CORPORATION, PARTNERSHIP ORSOLE-PROPRIETORSHIP Clvde Wriohtstone 21081218 Schetlule C-1 or C-2 (including ell supporting information) must be attached for each clmNy-hNd corporation/pennership inlerost of the dacedanL other than a solo-propriatorship. Sae instructions for the supporting Information to be submiaed for sdo-pmprielorships. ITEM VALUE AT NUMBER DESCRIPTION DATE OF DEATH ~' Wrightatone Electric, Inc. 12,632.10 92.49548 ownership in corporation (ores attached valuation) TOTAL (Also enter on line 3, Recapitulation) $ 12 632 10 3W48a] 1.0011 (f more space is neetletl, insert atldttional sheets of the same size) --~--- Carey Associates, Inch. Accounting, Consulting & Tax Services July 10, 2009 Snelbaker & Brenneman, PC Dick Snelbaker 44 W. Main Street Mechanicsburg, PA 17055 Dear Mr. Snelbaker, As per your request, I am providing you with the stock book valuation and estimated fair mazketroalue of Clyde Wrightstone's shares of Wrightstone Electric, Inc. as of his date of death, November 26, 2008. Based upon my information, there are 40,002 shazes outstanding at a book value on November 26, 2008 of $0.8608 per share. Therefore, the book value of Mr. Wrightstone's shazes (37,000 according to my records) is $31,849.60. This was calculated as follows: Common/Capital Stock $ 32,336.00 Retained Earnings through 10/31!08 $ 5,312.05 Net Fiscal YTD Earnings (Loss) through 11/26/08 -$ 3,213.95 Total Book Value as of 11/26/08 $34,434.10/ Issued & Outstanding Shares 40,002 Book Value per Shaze $ 0.8608 Based upon my analysis of the mazket value of the assets and the outstanding liabilities of Wrightstone Electric, Inc. as of the November 26, 2008, a total fair market value estimate of Wrightstone Electric, Inc. is $13,657. Therefore, based upon Mr. Wrightstone's stock ownership percentage of 92.4954%, the estimated fair market value of his stock as of his date of death is $12,632.10. Attached is a Stock Ledger spreadsheet I prepared based upon information provided to me indicating shazes and ownership percentages for each shareholder. Please contact me if you need any further information. Carey Associates, 875 Market Street, Suite 120 Lemoyne, PA 17043 Phone (717) 7744382 Fax (717) 7744928 g 0 0 0 0 0 0 0 0 0 00060i~~N N N • p 0 0 0 0 0 0 0 0 0 eI0007 V' V' O 00 O O O N N N~~~ 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 7 O ~ ~ ~ N N N N h 0 0 0 0 0 0 0 0 0 O O N N N N N N N p 0 0 0 0 0 0 0 0 0 e I0 0 0 0 10 ~0 ~0 1n ~0 O O O O N N N N N O O ~ ,O 00000 ` I O O O O O C~ r r c-~ J 0 0 0 0 0 0 0 0 0 O N N N N N N N O p 0 0 0 0 0 0 0 0 0 e I 0 0 0 0 0 0 N ~ O O O O O O N N N O O ~ '- ~- O O O O NI O_ O O_ a 2 0 0 0 0 0 0y~ 0 0 0 O r d 47 lM[1 N M M eI0001~ V'~ V 001001 V O ~ ~ ~ ~ ~ a0~ ON ~ r 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 W 0 O ~ I O O O O O O W 0 O .jlf O O O 0 aD I~ ~0 N Imo. V V V' ~f MMMM MM O N N N N N N N y 0 0 0 0 0 0 0 0 0 = y 0 0 0 0 0 0 0 0 0 (/> > O o O O O O O O O w~vevvvvv<rv m N Eyy~ .~ QI m m m ~ ~ c c c y y d y y~ 01'o1'rn v v v v v O O O D U U U U S d O ~ ~'°o °'v a °~~aa U=~f~-JSFUU moomvvvvcul m y~~~~~~~~~ O ~ I O O O O O O O O M J ~ ~ ~ r (~ (~ (~ N N O X 0 0 0 0 0 Y O 0 0 0 0 0 0 0 fq ~ w °o_oo°_o m°o (O F- ~~ o ~ ~ o 0 0 0 0 0 .°c. r 'al v° ~ ~ w t a r ~NM V ~n~orpow 3 v'~~ 3:07 PM 07I31I09 Accrual BKIa Wrightstone Electric, Inc. • Balance Sheet As of November 26, 2008 Nov 26, D8 ASSETS Currant Aeaets CheckinglSavings Chgeking-M8T 11,389.20 CheckinB•PNC Bank _ 5,31 D,4a_ Total Chgcking/8avinge 18,688.64 Accounts Rsceiveble Accounts Recgivable 45,481.72 Total Accourds Receivable 45,481.72 Other Current Assets Inventory 27,800.00 Total Other Current Aesgro 27,800.00 Total Current Assets 69,951.36 Pixed Assets Vehicles 80,343.00 Equipment 31,738.00 Office Equipmem 4,489.00 Leasehold Improvements 50,003.00 Accumularod Ospreda6on (139,148.00) Total Fixed Assets 27,423.00 TOTAL ASSETS 717,374.36 LIABILITIES & EQUITY Liabilities Current Liabilities Other Current Liabilities Sales Tax Payable 475.35 Payroll Liabilitigq 56.28 Total Ofhsr Current Liabilities 53'1.63 Total Current Liabilities 531,83 Long Term Liabilities Vehicle Loan-PNC Bank 8,678.91 Note Payable-M&T Bank 58,517.72 Note Payable-C. wrightstone 14,214,00 Note Pdyablq-Wlkars 3,000,00 Total Long Term Liabilities 82,406.63 Total Liabilities 82,940.26 Equity Common StocK 32,336.00 Retained Earnings 5,312.05 Nat Income (3,213.95) Total Equity 34,434.10 TOTAL LIABILITIES & EQUITY 177,374.36 Pagel REV-1505 EX a (&95) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDENT DECEDENT SCHEDULE C-1 CLOSELY-HELD CORPORATE STOCK INFORMATION REPORT ESTATE OF Clvde Wriahtstone 21 08 1218 1. Name of Corporation Wriahtstone Electric, Inc. State of Incorporation pennsvlvania Address 100 South Market Street Date of Incorporation 10/31/1968 City Mechanicsburg State PA ~ Zip Code 17055 Total Number of Shareholders 2. Federal Employer 1. D. Number 23-1702103 Business Reporting Year 10/31/2008 3. Type of Business Retail ProducUService Electrical sulooliea/service 4 ST~1CI( 7'Yi+E v ti ti BN •Y TOTAL tj11NIpER OF HA U T hAR VA~Ut: NU{NSER OF SHARES + ~ALtiE OF THE b rtg bn ng O RES O A:N01N0 TS OJI .fN»fl~eY THE DECEDENT DECEpENT'S STOCK. Provide all rights and restrictions pertaining to each class of stock. 5. Was the decedent employed by the Corporation? , , , , , , , , , , ,,,, ^ Yes ^7{ No If yes, Position Annual Salary $ Time Devoted to Business 6. Was the Corporation indebted to the decedent? ......................... ^X Yes ^ No If yes, provide amount of indebtedness $ 14.214.00 7. Was there life insurance payable to the corporation upon the death of the decedent?..... ^ Yes ^X No If yes, Cash Surrender Value $ 0 .00 Net proceeds payable $ Owner of the policy 8. Did the tlecedent sell or transfer any stock in this company within one year prior to death or within two years if the date of death was prior to 1231-82? ^ Yes ^X No If yes, ^ Transfer ^ Sale Number of Shares 0 Transferee or Purchaser Consideration $ 0.00 Date Attach a separate sheet for additional transfers and/or sales. 9. Was there a written shareholder's agreement in effect at the time of the decedent's death, ^ Yes ^X No If yes, provide a copy of the agreement. 10. Was the decedent's stock sold? .... .............................. ^ Yes ©No If yes, provide a copy of the agreement of sale, etc. 11. Was the corporation dissolved or liquidated after the decedent's death? ............ ^ Yes ~ No If yes, provide a breakdown of distributions received by the estate, including dates and amounts received. 12. Did the corporation have an interest in other corporations or partnerships? ...........^ Yes ^X No If yes, report the necessary information on a separate sheet, including a Schedule C-1 or C-2 for each interest. A. Deteiletl calculations used in the valuation of the decedent's stock. B. Complete espies of financial statements or Federal Corporate Income Tax returns (Form 1120) for the year of death and 4 preceding years. C. If the corporation owned reel estate, submit a list showing the complete address/es and estimated fair market valuels. If reel estate appraisals have been secured, attach copies. D. List of principal stockholders at the tlate of death, number of shares held and their relationship to the decedent. E List of officers, their salaries, bonuses and any other benefits receivetl from the corporation. F. Statement of divitlends paitl each year. List those tleGared and unpaid. G Any other information relating to the valuation of the decedent's stock. (If more space is needed, insen atlditional sheets of the same size) awaeae toad REV-150] EX t (&Ba) • SCHEDULE D CDMMCNWFALTH OF PENNSYLVANIA MORTGAGES&NOTES I kF.S MEDECEDEMRN RECENABLE Clyde Wriahtatone 21 08 1218 All ProperlyjoingycwnWwhh right of survlvonShlp moat be dlacloaetl on 9chetlule F. aw<9AC 1.000 (If more apace is neetleQ insert additional eheeta d same size) REV-7508 F-X. (&Ba) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN SCHEDULE E BANK DEPOSITS, & MISC. Clyde Wriahtstone 21 08 1218 InUude the proceeds of Iltigetion and the date the praceeda were rxeivatl by the eata2e. All oroosM IolMlvawned wdh the dam of survlvorshio must be tlisclowd on Schedule F. ITEM I VALUE AT DATE NUMBER ~enoiannai OF DEATH 1 Church of God Home 2,266.71 refund due the decedent paid to nursing home for surviving spouse 2 Commonwealth of Pennsylvania 133.12 refund due the decedent on 2006 personal income tax returns 3 Household goods 615.00 4 M6T Bank 1,973.30 checking account #9833890966 5 M6T Hank 583.31 savings account #15004205865049 6 Pinnacle Health Hospital 31.97 refund due the decedent 7 PNC Bank, N.A. 38,250.76 savings account #5111997504 43.854.17 awaBAO 1.000 (If more space is needed, insert etlditional sheets o<the same tlza) REV-1510 E%a (e-88) CAMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN RESIDEM DECEDEM • SCHEDULE G INTER-VIVOS TRANSFERS & MISC. NON-PROBATE PROPERTY Clyde Wriahtatone 21 OB 1218 This schedule must be completed and filed if the answer to any of questions 1 through 4 on the reverse sitle of the REV-1500 COVER SHEET is yes. ITEM NUMBE DESCRIPTION OF PROPERTY ira~oelrewwE OrilErrw.eFears, llEiR RSU.nonm~v ro oECeoeNr uo 1FE 0.4lE OF lRMB~E4,gTi0Olq(gR'OF TIE OEEp FOF REPL ESTAFC. DATE OF DEATH VALUE OF ASSET %OF DECD'S IMEREST EXCLUSION IF PPPIICABLE TAXABLE VALUE t~ Gifts made to Grandchildren and others prior to death as Follows: 1. Brett Wittera (grandson) - $200.00 2. Brandon Minnich (grandson)- $200.00 3. Shawn Minnich (grandson) - $200.00 4. Janelle Damaky - $25.00 (The above amounts are included in the Date of Death value given by M6T Bank account #9833890966) 625.00 100.0000 625.00 0.00 TOTAL (Also enter on line 7, Recapitulation) $ (If more space is needed, inaen edddionel sheets aFihe aeme size) 3WdaAF 1.000 REV-1511 EX a (10.08) COMMONWEALTH OF PENNSYLVANIA INHERITANCE TAX RETURN SCHEDULE H FUNERAL EXPENSES & ADMINISTRATIVE COSTS Clyde Wrightatone 21 OB 1216 Dabta of decadent must be reported on Schedule I. 17EM NUMBER DESCRIPTION AMOUNT A. FUNERALEXPENSES~. t. Myers Funeral Home, Inc. funeral services 8,092.00 Total from continuation schedules . B. ADMINISTRATIVE COSTS: 1. Personal Representative's Commissions Name of Personal Representative(s) Linda IC. Minnick 6 Sue A. Wittera (2 1/2% each) Street Address City State Zip Year(s) Commission PaM~. 2. Attorney Fees Snelbaker & Brenneman, P.C. 3. Family Exemption: (If decedent's address is not the same as claimant' s, 2ttach explanation) Claimant Street Atltlress City State Zip Relationship of Claimant to Decetlent 4. Probate Fees 5. Accountant's Fees 6. lax Return Preparer's Fees 7. 1 Cumberland Law Journal advertising Executrices notice 2 Lester Erb heating oil Total from continuation schedules . 1,670.00 16,000.00 10,000.00 410.00 75.00 810.00 3,597.30 ]W48AG 1.000 1 vrA~ (Also enter on une a, w (If more space is needed, insert atltlitional sheets of the same size) 40.654.30 Estate o£: Clyde Wrightatone Schedule H Part 1 (Page 2) Item No. Description 2 Rolling Green Cemetery grave opening 3 Sue Witters funeral luncheon zi oe lzle Amount 1,570.00 100.00 Total (Carry forward to main schedule) 1,670.00 Estate of: Clyde Wrightstone Schedule H Part 7 (Page 2) 3 Mechanicsburg Borough sewer/refuse service 4 Patriot News advertising Executrices Notice 5 PPSL electric service 6 Register of Willa short certificate 7 Register of Wills filing fee for Inheritance Tax return 6 RSR Appraisers & Analysts appraisal fee 9 United Water of Pennsylvania water service 10 Reserve for filing fees, accountant fees and other miscellaneous costs associated with the administration of the Decedent's estate 21 OS 1218 373.00 175.89 A22.28 4.00 15.00 1,500.00 107.13 1,000.00 Total (Carry forward to main schedule) 3,597.30 REV-1512 EX ~ (12-OB) Pennsylvania SCHEDULE I OEPMThENi OF REVENUE DEBTS OF DECEDENT, INFERITANCE TPX RETURN MORTGAGE LIABILITIES & LIENS RESCIENi DECEDENT ESTATE of FILE NUMBER Clyde Wrightstone 21 OB 1218 Report debts Incurred by the decedent prior to tleath that remained unpaid at the tlate of tleath, Including unreimbureed medical expenses. ITEM VALUE AT DATE NJMBER DESCRIPTION OF DEATH t~ Angels on Call in-home nursing care 888. 65 2 Bank of Amercia credit card debt 657. 09 3 Sarry Heckard, Tax Collector 2008 personal income tax 11. 00 4 Gifts to Grandchildren and others checks written by decedent prior to death which are included in the date of death value for MST Bank. 625. 00 5 Grace United Methodist Church charitable donation check written by decedent prior to death which is included in the date of death value for MST Hank 110. 00 6 Hazel Wrightatone nursing home expense check written prior to death by the decedent which is included in the date of death value £or MST Bank. 475. 00 7 HTST charges for hospital phone and TV 16.00 8 ING Insurance insurance premium check written prior to death by the decedent which is included in the date of death value for MST Bank. 35.96 9 Lester Erb heating oil 405. 00 10 PA Department of Revenue tax liability due on 2008 Einal Individual (PA-40) Tax return 94. 00 11 Sue Witters check written by the decadent prior to death which is included in the date o£ death value for MST Bank. 700. 00 Total from continuation schedules 90.33 TOTAL (Also enter on Line 10 Recapitulation) S 4 108 03 ewaenN zooo If more space is needed, insert addhional sheets of the same size. Estate of: Clyde Wrightatone Schedule I (Page 2) Item No. Description 12 United Water Pennsylvania check written by the decedent prior to death which is included in the date of death value for M6T Sank. 13 Verizon phone service 21 OS 1216 Amount 47.60 42.73 Total (Carry forward to main schedule) 90.33 REV-1513 EX+(it-08) Pennsylvania ~PPATMEM OF 0.EVENUE INHERITANICE TAX RETURN RESIDENT DECEDENT ~ SCHEDULE J BENEFICIARIES FILE NUMBER ~..~ ae wr i ncstone 21 06 1218 RELATIONSHIP TO DECEDENT AMOUNT OR SHARE NUMBER NAME AND ADDRESS OF PERSON(S) RECEIVING PROPERTY Do Not List Trustee(s) OF ESTATE TAXABLE DISTRIBUTIONS [inGUde ouldgM spousal distdbutions, and trenefers untler Sec. 21 i6 (a) (1.2).] 7. Hazel I. Wrightatone 102 South Market Street Mechanicsburg, PA 17055 One Third of Residue per election against Will: 101,979.32 Surviving Spouse 101,979.32 2 Linda K. Minnich 786 Allenview Drive Mechanicsburg, PA 17055 One Third of Residue: 101,979.31 Daughter 101,979.31 ENTER DOLLAR AMOUNTS FOR OISTRIBUTIONS SHOWN ABOVE ON LINES 15 THROUGH 7 8 OF REV-1500 COVER SHEET, AS APP ROPRIATE. II NON-TAXABLE DISTRIBUTIONS: A. SPOUSAL DISTRIBUTIONS UNDER SECTION 2113 FOR WHICH AN ELECTION TO TAX IS NOT TAKEN 1. B. CHARITABLE AND GOVERNMENTAL DISTRIBUTIONS 1. TOTAL OF PART II - ENTER TOTAL NON-TAXABLE DISTRIBUTIONS ON LINE 13 OF REV-1500 COVER SHEET. $ 0.00 ewaeAl zooo ~~ ~~~~~~ ~pa~n s neeaea, insert aaauwnal sneers o1 the same size. Estate of: Clyde Wrightatone Schedule J Part 1 (Page 2) Item No. Description 3 Sue A. Witters 503 Allendale Road Mechanicsburg, PA 17055 Relation 21 08 1218 Amount One Third of Residue: 101,979.31 Daughter 101,979.31 i LAST WILL AND TES'CAMENT I, CLYDE Vl%RIGH"CS"CONE, of the Borough of Mechanicsburg, County of Cumberland, and Comnxnwealth of Pemtsylvania, being of sotuid and disposing mind, memory and unde,tstauding. do make, publish and declare this as and for my Last Will and Testament, hereby revoking aztd making void a.ll former wills and codicils by me at anytime heretofore made. FIRST. I order and direct that all my just debts and funeral expenses be paid by my Executrices, hereinafter named, as soon as conveniently may be done after my decease SECOND. I give, devise and bequeath all the rest, residue and remainder of my Estate, teal, personal and mixed, whatsoever and wheresoever situated, in equal shares unto my daughters, namely, LINDA K. MINNICH and SUE A. ~y'ITTERS, share and share alike, absolutely and iu fee simple. If either of my said daughters should predecease me, 1 order and direct that the foregoiug distributive share attributable to such deceased daughter shall be distributed to such deceased daughter's issue per sflrpes buy representation and not per capita. LASTLY. I nominate, constitute and appoint my daughters, namely, LINDA K. MINNICI~ and SUE A. WITTERS, to be the Executrices of this, my Last Will and Testament, but if for any reason either of my said daughters shall fail to qualify as such Executrix or cease so to serve, then and in that event, I nominate, constitute and appoint the daughter so remaining to be the F..xeeuu-ix hereof, each and both to serve without bond or other security as a condition qualification hereunder. IN WLCNESS WHEREOF, I, CLYDE WRIGHTS'I'ONE, have hereunto set my hand and to this my Last Will and Testament, which consists of one (11 typewritten page to which I I bare affixed my signattue this f2., ~~day of November, A.D. Two Thousand Fotur s LAW OFFICES ~~ ~f/} pp A T SNEL6AKER, ~/~JyT,~- ~=`S~ .L ~ ~¢ (JJ.:.l1L~ B REN,NEMAN !-' Clyde VV%, ht$tolre L ~~ the preceding itistiiihieirt, consistii9~ of tats attu one trI Omer rypecvuuen page; eacu identified by Che signature oFthe Testator, was ou the date thereof signed, sealed, published and declared by CLYDE WRIGHTSTONE, the Testator therein Warned, as and for his Last Will and Testament, in dte presence of us, who, at his request, in his presence and in the presence of each other, have subscribed. our Names as witnesses here -~ COAJMONWEALTH OF PENNSYLVANIA) COUNTY OF C:UNIBERLAND SS. We, CL1'DF, WRIGHTSTONE, RICHARD C. SNELBAKER and JANE J. GOONEY, the Testator and the witnesses, respectively, whose narues are signed to the attached or foregoing instrument, tieing first duly sworn, do hereby declare to the undersigned authority that the Testator signed and executed the instrument as his Last Will attd Testament and that he had signed willingly, and that he executed it as his free and vohmtary act for the purposes therein expressed, and that each of the witnesses, in the presence and heazing of the Testator, signed the Will as a witness and that to the hest of his or her knowledge, the Testator was at that time eighteen years of age or older, of sound mind and under no constraint or undue influence. lJ '~'iress~ Subscribed, sworn to and acknowledged before me by CLYDE WRIGHI'STONE, the estator, and subscribed and sworn to be ore me by RICHARD C. SNELBAKER and JANE J. OONEY, the witnesses, this a day of November, 2004 Notary Public LAW OFFICES SNELBAKER.