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Home My WebLink About94-065361 i ~i ~i 7 ~~ ~~ II-17`~~ IN Tt1E COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PGNNRYLVANIA CIVIL ACTION--LAW BOOK OF T`tE MONTH CLUB INC., t Plaintiff, V8. HOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, Respondent. ORDER AND NOW, this ~_ day of ~"`IDUE~h-~t'y , 1994, upon review and consideration of the Petition for Appeal from Aaseaement of Book of the Month Club, Inc., the Court schedules a hearing for the ~ rn~ day of .t t 19~~, at d'•4 5` 11{.M. in Courtroom No. 'fl of the Cumberland County Courthouse for a hearing in this ,i r 1~1, i 1~ u~~~~~ ~. ~_ __ g, t t z n_ ~, :r -,, ~~J nl n T r) .' ~ ~ 0Y ~• ._ V~ ~ n i .~ ~ ~ ~.%1 •/1 ~ N ' ' ~ N . `~ w ~ ~ ~ ~ ~ ti~ ~ r ~ ~ ~ - ~~, ~~ N ~ ~~ z w !n ~ o z ~ o a w $ w m ~ ~ w a ~ ~~o ~ F ~ ~~ ~w ~ c o °U z F z ~ ~nU m° a~ ao~ ~ I cw ~C 3 ~ a a ~ ~, ¢ ~ ~ a a°~ ~ zr EZ x ~ '~ ~ U W ~ ~ O~ p j p ~ NNy ~ ~ .~ ° ° o ~~ ~ zw m m a HO O z 015-8-43 11/01/94 IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION--LAW BOOK OF THE MONTH CLUB INC., : Plaintiff, : vs. No. BOARD OF ASSESSMENT APPEALS . OF CUMBERLAND COUNTY, Respondent. PETITION FOR APPEAL FROM A88E88MENT OF THE BOARD OF ASSESSMENT APPEALS AND NOW, comes BOOK OF THE MONTH CLUB, INC., by its attorneys, Zimmerman, Pfannebecker G Nuffort, 22 South Duke Street, Lancaster, Pennsylvania and files this Petition for Appeal from Assessment of the Board of Assessment Appeals, of which the following is a statement: 1. Petitioner is the property owner of the property known as Book of the Month Club, Inc. identified as Tax Parcel No. 42-10-0646-006. The owner is Book of the Month Club, Inc., 1225 South Market Street, Mechanicsburg, Pennsylvania 17055. 2. Respondent, Board of Assessment Appeals, is a "Board for the assessment and revision of taxes" within the meaning of 55020-102 of the General County Assessment Law, 72 P.9. 55020-102 and a "Board of Assessment Appeals" within the meaning of the Fourth Claea County Assessment Law, 72 P.S. 55453-102. 3. The said property is located within the boundaries of Cumberland County, Upper Allen Township, and the Mechanicsburg School District, and a true and correct copy of this Petition for 015-8-43 11/04/94 Appeal shall be served forthwith upon the avid municipalities and school district. 4. For purposes of the 1994 tax year, the Board assessed subject property which !e designed ae the Hook oP the Month Club, Inc., Tax Parcel No. 42-10-0646-006, ae follows: Total: ;862,500.00 5. Petitioner appealed to the Board for relief from this assessment, requesting that the assessment be reduced. 6. On or about October 21, 1994, the Board issued Notice that it determined the market value of the above-captioned property to be ae follows: Total: 510,600,000.00 A true and correct copy of the Notice is attached hereto as Exhibit "A" and incorporated by reference herein. 7. Petitioner alleges that the asaeeament be the Board issued on or about October 21, 1994 is improper and unlawful for one or more of the following reasons: (a) The asaeeament ie not uniform with other assessments in Cumberland County; (b) The asaeeament Sa arbitrary, excessive and un- reasonable; (c) The asaeeament does not conform with the common level ratio that exists in Cumberland County; (d) The assessment does net accurately reflect the fair market value of the Petitioner's property; (e) The asaeeament ie unreasonably high, improper, unjust and contrary to law and was arrived at - 2 - 015-8-43 11/04/94 without application of the statutory requirements provided under the General County Assessment Lew and the County Assessment Law applicable to Cumberland County and (f) The assessment Se otherwise illegal, unconstitutional, non-uniform, arbitrary end unreasonable. 8. As the property owner and a party aggrieved by the assessment, your Petitioner has the right to appeal pursuant to the provisions of the General County Assessment Law and the County Aeaeeament Law applicable to Cumberland County. WHEREFORE, your Petitioner requests that the Court hear this appeal and enter such Order as it deems proper pursuant to the provisions of 5518.1 of the General County Aeaeeament Law, 72 P.S. 55020-518.1 and the Fourth Class County Assessment Law, 72 P.S. 55453.704. ZIMMERMAN, PFANNEBECRER & NUFFORT By•RICHARD P. NUFFORT, Esquire Attorneys for Petitioner Attorney I.D. M16044 22 South Duke Street Lancaster, PA 17602 (717) 299-0711 - 3 - 015-8-43 11/01/94 VERIFICATION I vorify that the statements made in the foregoing Petition are true and correct to the best of my knowledge, information, and belief,. I further verify that I am the ~~~ ;~{,•,,~' Carkollrr of BOOK OF THE MONTH CLUB, INC., and that as such, I am authorized to make this Verification on its behalf. I understand that false statements herein are made subject to the Qenaltiea of 18 Pa.C.S. 54904 relating to unsworn falsification to authorities. DATED: I~li~~~`~ 1-lam ~~~^ {~~ EARL R. xELLER CIIAInMAN NANCY A. DESCH vice numMAN MARCIA L. MYERS creneTAnr WILLIAM E. DENNIS CIIIEF CI EnA/COWITY AO MIN IarnA 1011 RODERi N. C. LISSE ASSEaaMENT E TA%AnMIN IaTNATOR RANDY L. WAGGONER crneF Assesson IfORACE A. JOHNSON soucrton STEPHEN D, TILEY AsslsuNr soucnon ~Iumbrrittnd (~uunty 1~pttrd of .~tt.uru,~ment ttnd ~ruitt~un of c~tt,~ra 1 Counnmuse Souene, DARLI9LE, PA 77019 Ir vl tm a7so October 21, 1909 Walnateln Appraisal Oroup P.O. Dox 9009 York, PA 17409 RE: Tax Parcel 92-10-0696-006 Book-oE-the-MolTtll Club The Doard of AaseaamonC Appoals Ordor Ia as Eollowa: Markel Value waa set at 510,800,000, ANY PERSON AQOItIEVF.D UY THE ORDER OF THE UOARD MAY APPEAL TO THE COURT OF COMMON PLEAS UY PILINO A PETITION IN THE PROTIIONOTARY'S OFFICE WITIi1N 30 DAYS FROM 9'IIE DATE OF 9'NIS NOTIFICATION.(I1/21/04) ~,.~E.twe.~~,.;~. Robert H.C. Liaae Aaaaaamant S Tax Admn. cc: Dook-of-lho-Month Club f229 S. Market Stroot Mechanlcabur0, PA 17095 a 1.7 W 6' 0.y1 u V U ~ fl y N ~ w Y 5 'C R' / k1 C'~ F U H N ../ to a C: 0 ~i~ f. ~ 'L ~~j f uJ a u1 R z G ~ d f .1 u. ~ i N o ~7 w~ N W :~ W P. -: P: . '=I p ~~ 4 ~ e ~ ~ m n a F N ~ U F~ ~ 7k ~ ~ y, Y ~ y~j c .~~.-t6 H ~ ~ a f 7 m w u C W O ~~ ~a Q ~' °' O U F F U w ~O W r. W N / cn ~ H CqC ~ < .~ ~ v~ U ~ ~ W a < UCH ... , te ~ ~ W N U ~.. ~~ C' ~ ~ :G O q a'jU -~. ~ F. I ~ r H U '!. W W W O BOOK OF THE MONTH CLUB, IN THE COURT OF COMMON PLEAS OF INC., CUMBERLAND COUNTY, PENNSYLVANIA Plaintiff No. 94-6536 CIVIL TERM y, REAL ESTATE TAX ASSESSMENT BOARD OF ASSESSMENT APPEALS APPEAL OF CUMBERLAND COUNTY, Respondent PRAF.CIPE TO ENTER APPEARANCE T0: Prothonotary of Cumberland County Please enter and note the appearance of the undersigned as attorneys for the Mechanicsburg Area School District in the above captioned matter. SNELBA R 6 R' NIiMAN, P.C. gy d~G R chard C. Snelbaker 44 West Main Street Mechanicsburg, PA 17055-0318 (717) 697-8528 Date: December 29, 1994 uw orrmn S NELtl~KEtl e e11ENNEM4N CERTIFICATE OF SERVICE I hereby certify that I am this date serving a true and correct copy oP the within Praecipe to Enter Appearance upon the attorney for the Plaintiff-appellant by sending the same by first-class mail postage paid addressed as follows: Richard P. Nuffort, Esquire Zimmerman, Pfannebecker & Nuffort 22 South Duke Street Lancaster, PA 17602 o~~- chard C. Snelbaker SNELBAKER & BRENNEMAN, P.C. Attorneys for Mechanicsburg Area School District Dated: December 29, 1994 uw orncee BNELOAN Efl e OREN NEMAN n O H W u U O fn ~ ~ ~ W u ~ ~ d C+ CJ •ri m RJ W ' Q P ~ ~ ~ • I W : 4 G . C ...:. ' m w 0. u, ' / a if ~1 3 z S W J aww ° .~ ~ a ~ ~ ~ ~I ~ H ~ ~ m n ~~ ~ ~ 7 ° ¢ ~ u m x ~ z I w ~ .~ a x x ~, ~ o C ~ p ~ ri ° > •. O y+5x o ~ ~ ~ 0 o~H-~ ~ w a Wkk~ ~ a tiu~tw. x a ti' J ~ ~ ~ ~ ~ ~~~F ~ x wli a ~ ~~ l w x v w o o a~ n. rz'~ ' a ~ w rn E; u ~ ~.-' o u~! o ~' w o HU! W IC W C HOOK OF THE MONTH CLUB, INC., Plaintiff v. BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, Respondent IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA No. 94-6536 CIVIL TERM REAL ESTATE TAX ASSESSMENT APPEAL PRAECIPE TO INTERVENE TO: Prothonotary cf Cumberland County Mechanicsburg Area School District, a local taxing body, hereby intervenes as a party respondent-appellee. & HRENNEMAN, P.C. a~a a. u.aa ~ .. rneys foraMechanicsburq Area School District uw orr mee SNELOAKER e e RENNEMAN Date: December 29, 1994 CERTIFICATE OF SERVICE I hereby certify that I am this date serving a true and correct copy oP the within Praecipe to Intervene upon the attorney for the Plaintiff-appellant by sanding the same by first-class mail postage paid addressed as follows: Richard P. Nuffort, Esquire Zimmerman, Pfannebecker & Nuffort 22 South Duke Street Lancaster, PA 17602 ~/ R chard C. Snelbaker SNELBAKER & BRENNEMAN, P.C. Attorneys for Mechanicsburg Area School District Dated: December 29, 1994 uw orric[s 6NELDAKEN e BRENNEMAN .' ~, - y W q ~ a ro ~ z ~ ~ za ~ ~a~ ~ -v ~ _ x a ~ ~ ~ U ~ ~ i ~ ~ ~~o ~ ~ ~ ~ a'~ o u q ~ ~ a o ~ ~ a ~ ~ y ~,7 ~ c~ ux~ ~ ~ ~ ~ -t ~ ~1 F H O UW N WOW M ~ ~ U O ~ N HU ~ ~U 0 ~ Ho °w m°o v H ~-/ .~ .,~ u M rn O z ., IN TF1E COURT OF COMMON PLEAS OF CUMDERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW BOOK OF THE MONT}1 CLUB, INC., Plaintiff, vs. BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, Respondent. No. 94 6536 Civil Term CERTIFICATE OF SERVICE i, Richard P. Nuffort, Esquire, attorney for Appellant, BOOK OF THE MONTH CLUB, INC., Owner, hereby certify that on December 5, 1994, I served a true and correct copy of the Petition For Appeal from Assessment of the Board of Assessment Appeals upon the following and in the manner indicated below: Service by Certified Mail Cumberland County Board of County of Cumberland Assessment Appeals Court House One Courthouse Square One Courthouse Square Carlisle, PA 17013 Carlisle, PA 17013 Upper Allen Township 100 Gettysburg Pike Mechanicsburg, PA 17055 Book of the Month Club, Inc. Att: James J. VanHorn 1225 South Market Street Mechanicsburg, PA 17055 Mechanicsburg Area School District 500 South Broad Street Mechanicsburg, PA 17055 True and correct copies of the sender's receipts are attached hereto, made apart hereof, incorporated herein by reference, and marked Exhibit "A". The original return receipt cards are attached hereto, made a part hereof, incorporated herein by reference, and marked Exhibit "B". ZIMMERMAN, PFANNEBECKER & NUFFORT By: ~/ Richard P. Nuffort Attorney I.D. #16044 Attorneys for Appellant 22 South Duke Street Lancaster, PA 17602 (717) 299-0711 Date: December 12. 1994 -2- „V„ aF4F4X3 ~~ 'IItlW U3ldllkl3~ NOd 1d13~3U ~ o,nlt: Wllo f SJ v j!~(: (. 1 ... 11l•i ~.r\f l(:l llii'r U(~) i F nrn imuur«n u,n iw+u;„-.~~ 1~~\/L 1_N J~~ ~ ,~urvn rnr. ,.~ n,,v Iiwu'• .D ,..i r. ~'" 46/S/Zi 1'T- ,.a.r~iun,ir~. i~~~~,..~~~i~ I.orrol , ~ .,,~,a~~,.: ~ u.~ir I u11V 1n1 ~.,. ~ !111111 111 [111 .rllll , ~.,r~.inl ~~ 'S53000V NU1113U dO 1NDW 3111 'SS3UDOV NU013U dO 1NDlU 3N1 p. 3dOl3AN3 d0 dO11V tl3ND115 3DVld I1NV1UOdWl Ol 3dOl3AN3 d0 dO11V U3MJLLS 3DVld LLNV1UOdW1 ~a la I~ a o ~ J I >c O\ J N H \ ~ ' ~ eN-1 ~ ~ ~ ~i V O N l o o Ir, ~ i ~n `o it O O LL -1 .--I rl LL I ,n t- I ,.~ .-, a .r, a TC W +:.+: I C '. :7 ~ t r ~ c ., r~ } _tE ~ `~i ~ ~ ~ ~~~ ,~ V I Y ` '~ ..I ~ ~ }' l,' p g ~ S. ~ g !# u t! W ','-1 lei. ~ FX N (q n 9L2 EL9 hTb d '~ ~ a LL2 EL6 h46 d I ~ Id Iltl=q ~ ' .I lip 1' .. all-, .:/ .III, I,1.• 1 11~~ •.1 ..1 ~~ 111'Ip1i 111 .. +I l., l IiL ., ,, .I .Ia 411'1 ti SENT TO 1«).nwwnlJY••~; • Wt - • . . m 1 r t'u•:ctu; 1.: ,:ut (:4UIIL^/ !co„rd I.i ac , Onl: ecnit•t:;ICU~,r, ;;•.IUl.rle lT' (.i'r1 i[11•`1 .'li ?.11113 a PS FORM 38tH) RECEIPT FOR CERTIFIED MAIL I w.l 1 .`.--_-_Ia.ualn __ .. ~ ,: M 1u R1 N m M1 m S rl 0" a 1 .rvv.l ,. ...... NLCLIPf I 1111111111111 ~ 11111P1.11,11111'1 ;:I.INN.1. n ~II1 Ir n uol .Vr1, 111'. PoSTMAAA OR RATE Q 12/5/94 o ~~ tuuo F~ ~C 12/5/94 Il, ,., is ut. t:i•. ~. !~thiT.lt Club, 1n~.7. AL't: ./m~le:~ ~ . V ~nHnrn ~... , PS FORM 3aoo RECEIPT FOR CERTIFIED MAIL 1~ O Q~ u~ ~~ ~~ 8 3 Exhibit "A" ' • c/./.w..nr t •nu/a ~ b uY..ul w.t.. I• ('.npy •r•y l M Y 1 U I dl9o wW t ro rec0ivs the ' b la ~• M1 •^0 •NO•M on NU rw•rw tl M bm p p/er „~ c•n /.,/•n,•, •~ klbwirp eervN:ee (la afl eMlfe lee), i • All•tll M bm \/ Ne hM N m, muyyK... a un Ile p,U N 4/Ya U/u• M Iwml • N1M Ilulyrn Ih•p rix,e4.0' un Nr my.eu L•Yn• NY YICY nnNM • lln Iblun rbcgN iw wN prwvy , IM 1. ^ Acldreaeee a Addraea f 2~ ~ Restriclod D li p •yrwlu• tl Ilr Won NMnarwl 1 0 W Ilr e very ~ A11rna lea•eN t0 Ib9tma91er 10r lee. i 4a. Arlkle Numbor I County of Arland P 914 873 277 ' Court liouae 4b. Servke Type - ~ OiIU f'%f Yr~1Q4A0 8yuero ~ ~ ' Carlitale, PA 1701) IED ~ ~ Is of Oe ~e1y T i 6. Sipnalum - (Addressee) ~ s6ee e s ague end Are Peidl 8. 9lpnatum - (Apenq I 1 I P9 Form 3811, December feel DOMESTIC RETURN RECEIPT NaaTa . ~•NFrr 7. Y~iNr414 •dltloiW wYfo•a tBMo Wleh to retBlYB the ~ l01~ Y~ rwrir W •dlreu m Ifr rww d IM bm w Itil w un mbn M e rrN roI1DWlfle eervkes Ifa en e.lre lee): t • •11~ Iti bm b er hoM d Ne m•I+tsC•, a m Iro CscM N •Prce No•• ntl • N1H• "fklwn R•csNN ReO.eYM' m Nn m•py~, Mbw IM utkla run0er . m. rrl M v perml t' ~ Addressee 8 Addm90 2. ~ Restrkted Delive wn cea « .n YoNO, yw N..y.,n,. d nr p•rwrl er.d.N ro w ur al. tl Uen.•rv ry ConeuM poatmealer for lea a. Anrx Addreued a: - . 4a. Artkle Numtxr uppor Allnn To+mship P 914 873 278 300 Gottyaburg Pike 4b. 3ervke Type Mechanicsburg, PA 17055 CERTIFIED _ ~ ~ 7. Date f li r 6. 9grwlure - (Addressee) 8. Ad reasee a Address (Q~ILY it requested snd les vmdl d S lure entl ~ tT~~ ~ s Form 3811, December t t DOMESTIC RETURN RECEIPT ~ • Caro b wn t re/a ~ Ar •etborrl rwNo•a j.Cmd.b,.mA•M~•.U • twr n•m• utl •aEnw m ri nrww d eiY lam •o eW w• un nNrn eV• a•E { tttoo wbh to reottwa trb t ~,,~,enaua.~~: ~ ~ it ~ i ~ ~. Q Addreaeee e /mdnlN { ph 6m b Ilr M d tli• mYd•u, a m tlr 6tl M yo Oaw nd pwm ~ • Nls•'IWntt•alp M1U~V•d'aten nrR+w•ew. arrm. nmea. 2.~ Fieabkied DelWery { . tt. ae.a n.o.p f« w t~ fa ~• raru• d w Ve•on ab..a b eid m. i Catxtk minter ler hs. t I ~ :: , ~- - ~ t 4a Artkb tJumber . P 914 8 7 3 2 7 9 i ., : Neotianicabusg area V I ',80tWd1.9iaC!!.O! :. .. 4b. t3erv{ce type ~ 900 80{1tll BlOad St!!Ot + i NMO~MA1gibNt~Je Fl- 1?099 ~[ CERTIFlED i . l\110~ mo ~lbm1?~, _ ~. Date ~ oeure~_ , y ~ z- I _ - - . - : ~ ~ / I ~-+ ,onnv 1, ,ea,esrov and fee pekt) 8.8gnetwe - (Apentl ~J y PS Fain 3811, December 1981 DOMESI'iC RETURN RECEIP' Exhibit "H" - .+raea: • Qv.iiYM Xanr I rvl /p i b rfWawl rrv¢•• 18180 Wleh 10 r'al:elw 1118 i • Lmowro Amw 1 •n0 N+E lolbwinp 6Brvkea (la an extro leel: l • Rnl ya• ,We •N rllnr•, m Ilw ,M,w d Ihw bm •o Ne Mw c•n iMwn tl~w c b p, W 1, ^ Addreeaee'a Address • Al,ad~ tla• bm b tlw l,.i d tlw m/Ia•c• v on lh WrA tl •nc• Oue• M IIB~m• • W1~ro -rb,un n•up Ilgwaroe~ an rcw nwib.c• wow iti rbrA, nvnlr 2. ^ flaelrkled Dallwry • n. raa,n lLCwx Fr. w+ l•a+b 1a ur w~wN• d uw am a••.aM b w i i rr Cmaull atmealer la lee. Artk u b. ., • '"' 4a. Arlkb Number Cusbarland County 8oaral o! P 914 873 28U Aaaaaamant Jlppeels 4b. Servke Type Uno Courthnuoe equere Carlielw, PA 17013 ,~~G RTIFIED _ 7. ale of,Qe - • 8.9gnalure - (Addreaaee) ( ee e' a ~ ~ ~ P~1 AS, A RMnnl,im - IAmnll P9 Fam 3F371, December 1991 .. ~- '. - -- - - ~- - :+C~onpe. w.r l •Nra, x b WtltlbW ••mo.. I also wish to fBCBIvB the l I•~.Tbl•11•m•Srtl N+e folbwinp aervkea (lor en extra leeY• l • P,xx /a+ nam• rtl •Oenu on ew m•,w d IN• loan a tllq as can ren+n nu. c•rU N ~ 1. ^ AddreaBBe 8 Addreea rod, ex• brm b aw Iwx d nw me/pbre, ar m Ins ma, tl •o•c. tlo•• nol Da,mt. • -tYlun R•o•Ix lbu.ahd•on tlw m•• l•n Oebw,ns rtrr n,nor 2 ^ Reatdcted Delive p . • me {ialun pa.ap F•a we gotla ry Bn rquN• d M• pwaan U•IrwM b FM IM . ry n___..~. ___.___.__ .__ ._ _ ` a .. _.. _.._._ .._...~_. 'Hook of t11~ NOtlth Club; zno. P 914 873 282 Attt Jaieo J. Vanlbrn 4b. Servke Type 1225 BouCh Mnrltet Straot - "-"~ D Mechapioeburq, PA 17055 7. ale of Sy ~~ ul 6. Sgneture - (Addressee( B. se as ' ( Y l ke Pa1d.1 e. Sgnolure - (ABenq ~ ~ PS Form 3Bt 1, December 1991 .-r DOMESTIC RETURN RECEIPT Exhibit "D" BOOK OF THE MONTH CLUB, INC., Plaintiff v. BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, Respondent IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA No. 94-6536 CIVIL TERM REAL ESTATE TAX ASSESSMENT APPEAL ORDER OF COURT AND NOW, this 2~ day of January, 1995, on motion of By the C J. uw ornud eNELOAKER 0 BRENNEMAN Snelbaker & Brenneman, P.C., Attorneys for Intervening Respondent-Appellee (Mechanicsburg Area School District) and with the concurrence of Richard P. Nuffort, Esquire, Attorney for Petitioner, and Stephen D. Tiley, Esquire, Attorney Por Respondent, the hearing scheduled for February 2, 1995, in the above captioned action is hereby continued generally, to be rescheduled upon application of tea-~part~e~j~ 1, i, ,. , , ,~ .~ J SNELBAKER S BRENNEMAN APP OIISSIONAI CONI.ORA LION ATTORN i.YS Ai LAW ml Wur MAIN Srau r MECFIANICSBURG, PENNSYLVANIA V055 RICHARD C SNELBAKER KEITH O. BRENNEMAN /I/~l ei/n'1.!H PMIUP H SPARE January 24, 1995 Honorable Edgar B. Bayley Cumberland County Court House 1 Court House Square Carlisle, PA 17013 r u tlux 71tl rnc31MILE V171 4DT76tll Re: Book of the Month Club, Inc., Plaintiff, v. Board of Assessment Appeals of Cumberland County, Respondent (and Mechanicsburg Area School District, Intervenor) No. 94-6536 Civil Term Dear Judge Bayley: Counsel in the above captioned real estate tax assessment appeal have agreed to continue the hearing scheduled before you on February 2, 1995, to afford the Mechanicsburg Area School District the opportunity to prepare for the evidentiary hearing. For your convenience, I enclose a form of order to effect the continuance. Very u y Rich C. RCS:pjt Enclosure cc: Richard Stephen P. Nuffort, Esquire D. Tiley, Esquire yours, Snelbaker BOOK OF THE MONTH CLUB, INC., IN THE COURT OF COMMON PLEAS OF PLAINTIFF :CUMBERLAND COUNTY, PENNSYLVANIA V. 80ARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, DEFENDANT :946538 CIVIL TERM ORDER OF COURT AND NOW, this _~~ay of June, 1995, upon roquest of counsel for plaintiff for a hearing on the assessment appeal, a hearing is scheduled for Thursday, August 31, 1995, at 8;45 a.m., in Courtroom Number 2. By the Court, 1 , Edger B. Ba Richard P. Nuffort, Esquire For Plaintiff Richard C. Snelbaker, Esquire For Mechanicsburg Area School District Stephen D. Tiley, Esquire For County of Cumberland Cumberland County Board of Assessment Appeals ;saa __V b. 4~, Jue IZ IU 29 GM'95 OF list "{.,~ 111UNb'AI~I C'JPP 1,~.,'dq rr 'rIY ~ , Ht li `~'i ~~ ~n r ' t I ¢ < U 1 i ~ i N Q < u LL O Z a O Z a J Q V W O V .~ t t I J W U +~ /> LL W ~ 1 Z o Q i J I 11 W 1 SQ G ~ ,'. O ~.1 a ~l 1 1~. I I m 1 z N -r 0_ S ~ ~I ~. x t~ 1 ~~~~ I ~ ,, I~ S ? 1~ ¢ ~ I u_ ~ 1 ~ H ,:. L f o ~ I o>Z. ~ 1 ~ 0 s~ a 1 o . I~ .. „~ 1! ~ ~' ' 1' i y .1, ~' ~f ~ I i~~O C < i i O~ , ~y1 ~ ' ^ ~! 1 h' ~~~f_ ~~ ~~ l0 ;jam 7~ dv ~ '<v `\ ^y 1 i : ~ M'Y 0 1} ~~ ~ 0 0 1 i ,p 1 l Z ~ 11 I < I~h ~ N 1V;„ \ ~ W~ bi fIV J ~ P SG ~~ I ~wy J I I v* ~ a 1 I N 1 ~ n 'I n ~ _ I 1 y I' ~ l 0 l . 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N N U ¢ U F W `m1 • LL I • I W 1 0 _. rv n • m rv n • N rv n N m n a o F n m a n ~ rv ni 'n Z 2 u W F 2 ~,- w N ~ m m .. m ~ K ~ ~ ~ [] J I O 6 F W < O W 1 21 L _ , W 2 0 ' < U U Z 7 ¢ m « U LL u N O N O D I G ¢ O fU J 2 W = - < r 0 _ m U Z F U U U ~ O R (~ t 2 ~ • O 2 l C N - - ~ U Z N - ~ 6 U O O O lu Y Y W 2 2 w 0 0 0 O 1 pi 2 .. - . < (? ¢ ~ O ~; If n R . D ¢ .I < ~O N 1 u O ~. W l ~ O U > U O O 61 ~ O .. U 1" R ( ~' I r- p tl V. ~ O LL m m Yl O Pl < J U R W vl 1/ i 6 n LL O u LL W W W J < U U U U V N U S 1~ N W - - ~. ~ 3 N U U O z m N H Yi r .. N VI W r U U U I o n o ¢ ¢ ^ J o ' L < ~ i ~ i> < z J. < ¢ m ¢ < w ' R ' 0 w rt ¢ ¢ R ¢ ¢ n. n , R U U R N Il ~ L1 1 w~ ~ ~f [ I j 11 RI 1 111 N N '1 - N N U R: . 11 1• • 1: I ~~~-- m ~ O ~ w U COMMONWEALTH OF PENNSYL VANIA STATE TAX EQUALIZATION BOARD P.O. BOX 909 Fax June 15, 1995 HARR/SBURG PA 17108-0909 7n-787-SS6o PHONE 717-787-5850 The State Tax Equalization Board has established a Common Level Ratio for each county in the Commonwealth for the calendar year 1994. The ratios were mandated by Act 267-1982. The law requires the State Tax Equalization Board to use statistically acceptable techniques, to make the methodology for computing ratios public and to certify, prior to July 1, the ratio to the Chief Assessor of each county each year. The statistical technique which the Board used for the 1994 Common Level Ratio is to determine the arithmetic mean of the individual sales ratios for every valid sale received from the county for the calendar year 1994. The methodology used is to include every va1S,d sale with a ratio from l+k to 100+k and compute a mean. Using t is mean as a base, the State Tax Equalization Board has defined high and low limits by multiplying and dividing this computed mean by 4. Using these computed limits, the State Tax Equalization Board has utilized the valid sales, rejecting those sales which exceed the limits. The resulting arithmetic mean ratio is the ratio which the State Tax Equalization Board is certifying as the Common Level Ratio for each county for 1994. There is one exception to this procedure. The original mean ratio for those counties which have a predetermined assessment ratio for 1994 of 500 will utilize valid sales from SAc to 2005k. The Common Level Ratios for 1994 are listed on the back of this page. ~ STATE TAX EQUALIZATION BOARD Trevor Edwards, Chairman Martha Bell Schoeninger, Member James E. Bach, Member i I !' ' JUN 1 51995 ~ 1994 COMMON LEV EL RATIOS ' i., _ . L---- _~ ~OUNTY RATIO COUNTY RATIO COUNTY RATIO ADAMS 41.2 ELK 21.7 MONTGOMERY 5.3 ALLEGHENY 21.3 ERIE 9.7 MONTOUR 10.5 ARMSTRONG 18.2 FAYETTG 13.7 NORT}{AMPTON 55.6 BEAVER 43.2 FOREST 38.9 NORTF[UMBERLAND 7.6 BEDFORD 10.7 FRANKLIN 7.0 PERRY 10.5 *BERK9 106.7 FULTON 20.0 PHILADELPHIA 28.7 BLAIR 13.8 GREENE 31.9 PIKE 34.2 BRADFORD 43.9 HUNTINGDON 22.8 POTTER 14.1 BUCKS 5.0 INDIANA 13.0 9CHUYLKILL 15.4 BUTLER 14.5 JEFFERSON 25.0 3NY1)ER 6.6 CAMBRIA 20.0 JUNIATA 17.4 30MERSET 11.9 CAMERON 49.5 *LACKAWANNA 22.8 9ULLIVAN 37.0 CARBON 8.6 +LANCASTER 16.9 SUSQUEHANNA 51.7 CENTRE 5.6 LAWRENCE 18.8 TIOGA 37.9 CHESTER 6.3 LEBANON 9.6 UNION 22.1 CLARIOC7 13.4 LEHIGH 50.1 VENANGO 22.9 CLEARFIELD 25.5 LUZERNE 7.6 WARREN 45.6 CLINTON 37.5 LYCOMING 55.7 WASHINGTON 22.1 COLUMBIA 41.3 MCKEAN 16.0 WAYNE 10.1 CRAWFORD 51.7 MERCER 13.4 *WESTMORELAND 31.0 CUMBERLAND 7.3 MIFFLIN 12.4 WYOMING 13.0 *DAUP}IIN 61.5 MONROE 7.1.9 *YORK 72.4 DELAWARE 3.1 ~ * COUNTIES WITfi A PREDETERMINED ASSESSMENT RATIO OF 100 COMMONUEALTli OF PENNSYLVANIA STATE TAX EQUALIZATION HOARD 705 TRANSPORTATIOti 6 SAFETY BUILDING iIARRISBURG PA 17120-0015 PHONE: 717-787-5950 FAX: 717-787-3936 June 21, 1994 The State Tax Equalization hoard hoe established a Common Leval Ratio for each county in the Commonwealth for the calendar yeaF 1993. The ratios were mandated by Act 267-1982. The law requires the State Tax Equalization Board to use statistically acceptable techniques, to make the methodology for computing ratios public and to certify, prior to July 1st, the ratio to the Chief Assessor of each county each year. Tha statistical technique which the Board used for the 1993 Common Level Ratio is to determine the arithmetic mean of the individual sales ratios for every valid sale received from the county for the calendar year 1993. Tha methodology used is to include every valid sale with a ratio from lz to 100x and compute a mean. Using this mean as abase, the State Tax Equalization Board has defined high and low limits by multiplying and dividing this computed mean by 4. Using these computed limits, the State Tax Equalization Hoard has utilized the valid sales, rejecting those sales which exceed the limits. The resulting arithmetic mean ratio is the ratio which the State Tax Equalization Board Ss certifying as the Common Level Ratio for each county for 1993. Thane is ono exception to this procedure. The original mean ratio for those counties which have a predetermined assessment ratio for 1993 of 100x will utilize valid sales from !x to 200x. The Common Level Ratios for 1993 are listed on the back of this page. STATE TAX EQUALIZATION DOARD Trevor Edwards, Chairman Martha Hcll Schoenfnger, I•tember 'i~~ ,'-' (~" ~~ ~' ~ Damns E. Hach, Member ' ~ JUN 2 y 1994 ,~ 1993 C1k410N LILVEL RdTIOS ,. O U N T Y R A T I O C O U N T Y R A T I O C O U N T Y R A T I O AUADIg 42.0 ELK 21.d h10NTCOMERY 5.4 r1LLECIIENY 22.0 ERIE 9.9 hI0NT0UR 8.0 ARMSTRONG 18.9 FAYETTE 13.6 NORTHAMPTON 53.3 BEAVER 44.0 FOREST 37.7 NORTHUMBERLAND 7.6 BEDFORD I0.4 FRANKLIN 7.3 PERRY 9.8 BERKS 6.8 FULTON 20.2 PHILADELPHIA 26.9 BLAIR 14.8 CREENE 36.9 PIKE 34.7 BRADFORD 48.6 HUNTINGDON 26.3 POTTER 13.7 BUCKS 5.0 INDIANA 13.1 SCHUYLKILL 15.5 BUTLER 13.9 JEFFERSON 23.0 SNYDER 6.9 CAMBRIA 19.7 JUNIATA 18.1 SOMERSET 11.4 CAMERON 51.3 *LACKAWANNA 22.2 SULLIVAN 33.4 CARBON 8.5 *LANCASTER 17.3 SUSQUEHANNA 10.5 CENTRE 5.9 LAWRENCE 20.9 TIOGA 39.8 CHESTER 6.5 LEBANON 9.6 UNION 22.9 CLARION 14.1 LEIIICH 50.3 VENANCO 23.5 CLEARFIELD 25.2 LUZERNE 7.7 WARREN 47.3 CLIN'ION 37.6 LYCOMING 57.9 WAS'lINGTON 22.6 COLUMBIA 43.5 hicKEAN 17.3 WAYNE 10.7 CRAWFORD 50.9 hlERCER 14.4 *WESTMORELAND 30.4 CUMBERLAND 7.5 MIFFLIN 12.9 WYOMING 12.2 ~DAUPI(IN 66.1 h10NR0E 21.3 *YORK 75.0 DELAWARE 3.! * COUNTIES WITH A PREllF:TERMINED ASSESSMENT RATIO OF 1002 ~~ t<I.n~ s.srnr~ nl~l~l~nlsnr. I~Ir~oRT Inl n r.I I:I;,I liuu uirn UI'I'I I~ i,l I I rd I i ,;~ItJ: ~l lll' CUr,11i1 l;1 %~IJU G~ )UtJ I l f 41JMS1'I Vi~NIA iAX f'n12C[1_ tt42-10-Oli4ii-0OG PLAINTIFF'S EXHI©IT ., I 4i A ~~ ~ .v .j ~~ l C !. I~ I:~ t•~ kd I p1 i t1 REAL ESTATE APPRAISAL REPORT INDUSTRIAL BUILDING 1225 SOUTH MARKET STREET UPPER ALLEN TOWNSHIP CUMBERLAND COUNTY, PENNSYLVANIA TAX PARCEL #42-10-0848-008 FOR RICHARD P. NUFFORT ZIMMERMAN, PFANNEBECKER 8 NUFFORT 22 SOUTH DUKE STREET LANCASTER, PA 17802 AS OF SEPTEMBER 1, 1994 FOR TAX YEAR 1995 Shateg~s d w TABLE OF CONTENTS M I TITLE PAGE ........................................................................................................................ ... TABLE OF CONTENTS ....................................................................................................... ... d~ LETTER OF TRANSMITTAL ............................................................................................... 1 ~ SUMMARY OF FACTS AND CONCLUSIONS .................................................................... 6 PHOTOGRAPHS OF SUBJECT .......................................................................................... 8 N PURPOSE AND FUNCTION OF THE APPRAISAL ............................................................. 8 I DEFINITION OF MARKET VALUE ...................................................................................... 9 PROPERTY RIGHTS APPRAISED .................................................................................... 10 SCOPE OF THE APPRAISAL 10 i+l ............................................................................................ f ~ LOCALITY .......................................................................................................................... 11 SITE DESCRIPTION .......................................................................................................... 14 .. IMPROVEMENT DESCRIPTION .... 17 ~~ .................................................................................. SQUARE FOOT CALCULATIONS . .. 19 AGE AND CONDITION OF THE IMPROVEMENTS ........................................................... 22 OWNERSHIP AND RECENT HISTORY ............................................................................. 23 {~] I 1 REAL ESTATE ASSESSMENT AND TAXES ..................................................................... 23 N 23 G ............................................................................................................................. ZONI .. ............................... . HIGHESTAND BEST USE 25 ........... . ................................................... METHOD OF VALUATION ............................................ 27 ..."....,", SALES COMPARISON APPROACH ..................................................................... 29 ........................................................................ INCOME APPROACH 47 ~_ ................................ RECONCILIATION AND FINAL ESTIMATE OF VALUE ..................................................... 85 ADDENDA Zoning Ordinance ...................................................................................................A-1 Land Sales .............................................................................................................A-4 Profiles of the Appralsere .......................................................................................A-5 ~I 1~ I q! i Stratus .~ -, j Stratus aM:,w~;~I,r;1 ~ May 4, 1995 I) 51tiH C;unpuu Duvn Plyma,Ul Muo0n0, PA 10.102 1111 OI 0.11.1200 Cue 10101 N20~4UJ2 Richard P. Nuffort I Zimmerman, Pfannebecker &Nuffort 22 South Duke Street Lancaster, Pa 17802 M RE.• INDUSTRIAL BUILDING 1225 SOUTH MARKET STREET UPPER ALLEN TOWNSHIP CUMBERLAND COUNTY, PENNSYLVANIA Dear Mr• Nuffort: {~ At your request, we have Inspected and appraised the captioned property. We estimate the [~ market value of the fee simple estate, ae of September 1, 1994, to be: -SEVEN MILLION ONE HUNDRED THOUSAND DOLLARS - - ($7,100,000) We have made a careful inspection, study, and analysis of the property, and have considered all factors which, In my opinion, would influence the market value of the subject. This valuation Is submitted subject to certain assumptions and limiting conditions which ere set forth In the body of this report. Additional Information, including (laid notes collected during our analysis end utilized in our conclusions, has been retained in our files for future reference. We have prepared this report subject to the following assumptions and limiting conditions. Information, estimates, and data have been obtained from sources considered reliable, and ere believed to be true end correct. Possession of this report dons not carry with it the right of publication. No part of this report may be disseminated to the public without our prior approval. W ky I This report Is to be used In whole and not in part. No part of It may be used In conjunction with any other appraisal. The distribution of value between land and ~ Improvements applies only under the described program of utilization. A report related I to a fractional Interest or a geographic portion of a larger property should not be assumed to apply with equal validity to other Interests or portions of the same property. ra I No responsibility Is assumed for matters which are of a technical, engineering, or legal nature. No responslbllity for structural soundness or conformity to city, county or stale ~ 1 building and safety codes can be assumed without an Independent structural I engineering report. Good title Is assumed and management is assumed to be I competent. ~ Testimony or attendance In court or at any other hearing is not required by reason of rendering this appraisal unless such arrangements have been made in advance. I Furnishings and fixtures, machinery and equipment, and the value of business operations have been excluded from this real estate appraisal unless specifically noted J in the body of this report. Any equipment which has been noted and Included is ~ assumed to be in normal operating condition. Unless otherwise stated (n this report, the existence of hazardous substances, Including, without limitation, asbestos, polychlorinated biphenyls, petroleum leakage or agricultural chemicals, which may or may not be present on the property were not called to the attenllon of the appraisers nor did the appraisers become aware of such during their inspection. The appraisers have no knowledge of the existence of such materials on or in the property unless otherwise staled. The appraisers are not qualified to test for such substances. The presence of such hazardous substances may affect the value of the property. The value estimated herein is predicated on the assumption that na such hazardous substances exist on or in the property or in such proximity thereto which would cause a loss in value. No responslbllity Is assumed for any such hazardous uired to discover them ertise or knowled e re fo a ex b t . g q p ances, nor r ny su s The Americans With Disabllitles Act (ADA) became effective on January 28, 1992. We j k~i have not made a specific compliance survey or analysis nor have we been provided with a specific compliance survey or analysis of the subJect to determine whether or not it is in conformity with the various detailed requirements of ADA. In the absence of evidence relating to this Issue, we have not reflected possible noncompliance with the requirements of ADA In estimating the value of the subJect. ~ Sketches In this report are Included to assist the reader in visualizing the properly. No i d survey of the property has been made by the appraisers. I t ~I I ra ra Stratus .. I The projections Included In this report are utilized to assist In the valuation process and r~ are based on current market conditions, anticipated short term supply and demand factors, and a continued stable economy. Therefore, the projections are subject to I changes in future conditions that cannot be accurately predicted by the appraisers and could affect the future Income or value projections. k~ I We certify to the best of our knowledge and belief that: ki The statements of fact contained In this report are true end correct. i The reported analyses, oplniona, and conclusions are limited only by the reported ~~ assumptions and limiting conditions, and are our personal, professional analyses, I oplniona, and conclusions. 1~ We have no present or prospective Interest or bias with respect to the subject property 1 i or the parties Involved. {.~ The acceptance of this assignment was not conditioned upon our reporting a specific 1 i (dictated) value; nor was the acceptance of the assignment conditioned upon our concluding a requested minimum value or maximum value; nor was the acceptance of the assignment predicated in any way upon the approval, extension, or modification of an existing ar pending loan for which the subJect real estate is or may be pledged as collateral. Our compensation Is not contingent upon any action or event resulting from the analyses, opinions, or conclusions in, or use of, this report. Our analyses, opinions, and conclusions were developed, and this report has been prepared In conformity with, the requirements of the Uniform Standards of Professional Appraisal Practice, and the Code of Professional Ethics and the Standards of Professional Practice of the Appraisal Institute. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. As of the date of this report, I, Peul W. Shoup, Sr., have completed the requirements of ~,~ the continuing education program of the Appraisal Institute. We have made a personal inapecllon of the subject, and have personally prepared the r analyses end formed the opinions presented in this report but were assisted in the collection and processing of data by Sharon A. Breen whose participation Is hereby i acknowledged, k>i I t~ ~I C M Strate~S 1 '.I _i 4 Please do not hesitate to call if we can provide further assistance. n1 , Cordially, ) ~~~ ' Paul W. Shoup, Sr., MAI, CAE, CMI Senior Vice President Professional Services Penneylvenla Certified General Appraiser License #GA-000191-L hri D:PACD02 a J ~J a J J ~ Stra~e~s 1 ~ SUMMARY OF FACTS AND CONCLUSIONS 'I w ~) Ki 4~ rI ~1 ,1 s Industrial Building 1225 South Market Street Upper Allen Township Cumberland County, Pennsylvania 66.26 acre Irregularly shaped parcel 385,981 square foot ane-story industrial building with a mez~enine level used as offices Fee simple Book-of-the-Month Club, Inc. Book-ot-the-Month Club, Inc. Continued Industrial use $7,100,000 Allocated as follows: Improvements & supporting ground $5,500,000 Excess land $1,800,000 September 1, 1994 for Tax Year 1995 February 7, 1995 Proporty Appraised Land Aroa Building Area Property Rights Appraised Owner Occupant Highest and Best Use Final Estimate of Value Date of Appraisal ,, Date of Inspection ,~ ~i ty I w ~. SLYdt~S r I_I 0 1 1 1 n n 0 I Gi•ILU IV, rL'ltlpvcr Jt. ~.umaic .-u. ~nn.rc•~„ Phonc 717-?~it•CCdG I~nx 717-2(3•HC27 N 00 M N f` .r r w M ~T N t` d C O L a -~ w i 9 The objective of this report is to estimate the market valuo of the fee simple estate as of September 1, 1994 for the tax year 1995. The Information, opinions, and conclusions contained in this report have been prepared to assist in estimating a proper basis for the real estate tax assessment. ~I' 11 l~ l t~ CA td I Market value 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: 1) Buyer and seller are typically motivated. 2) Bolh parties are well Informed or well advised, and acting in what they consider their best interests. 3) A reasonable time is allowed for exposure In the open market. 4) Payment is made in terms of cash, in United States dollars, or in terms of financial arrangements comparable thereto. 5) The price represents the normal consideration for the property sold, unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. I StRateg~s r -~ 4 I .j W !J I1 Pa to PRQPERTY RIGHTS APPRAlbEI2 The subject has been appraised ea a whole, owned In fee simple, end free of Ilene and encumbrances except (hose specifically Identified in the body of tho report, A fee simple estate le an Interest In real estate Ihet le unencumbered by any other Interest or estate, I.e., absolute ownership. As part of this appraisal, we have mado a number of Independent Investigetiona and analyses. The appraisal services rendered In this report consist of 1) definillon of valuation question; 2) collection of necessary data; 3) inepectlon of the subject property; 4) research and veriflcallon of comparable sales end/or rental data; 6) conelderation of zoning end/or other restrlctlone; 8) analysts of highest and beet use; 7) epplicetlon of the appropriate valuation methods; 8) reconcilletlon of value estlmatee; and 9) value conclusion for the subject property. In addition to information contelned In this report, we have relied upon general data J b I a I r contelned in our files, which are updated regularly. Stratus ,. ' ~ LOCALITY W !) it I1 The subject Is situated on the north side of the Pennsylvania Turnpike along the east side of South Market Street (Stale Route 114) in Upper Allen Township, Cumberland County, Pennsylvania. Upper Allen Township Ia situated in the eastern portion of Cumberland County, approximately ten miles northeast of Carlisle, the county seat. Carlisle is in the central portion of the county, 18 miles west of Harrisburg, 184 miles east of Pittsburgh, end 109 miles west of Philadelphia. The subject improvements consist of a one-story warehouse Iacility. This form of i'r ~• ~J ,~1 I I ea utilization is compatible with current zoning and land use patterns. The 1990 census reported 195,257 residents of the county, an Increase of 8.7°~ from the 1980 census. The 1994 estimated population was 204,400 persons (Source: Sales & Marketing Management). Upper Allen Township, occupying 14 square miles, had a 1990 population of 13,347. This figure represents a 28.72% Increase from 1980. Carlisle is considered the industrial center of Cumberland County. With a labor force numbering 111,100, the county reported an unemployment rate of 3.7% es of February 1995. The largest employer in the Harrisburg metropolitan area is the Commonwealth of Pennsylvania. Other major employers, with workers in the thousands, include Pennsylvania Blue Shield, Hershey Foods, Hershey Medical Center, Navy Ships Part Control Center and AMP. Major highways serving Cumberland County Include I-76 (Pennsylvania Turnpike), I-81, U.S. Highways 11 and 15, and State Highways 33, 34, 74, and 641. Rail is provided by Conrail Reading Line for freight service and Amtrak for passengers. The Carlisle Airport is available for private and business aircraft and the Harrisburg international Airport offers commercial service. ~ Stratus '1 MM f i Fi 11 li ~l lt`•J ~~ ~T L: i a w 1 rl tz The subject is located along the northerly side of the Pennsylvania Turnpike, I-76, approximately one-quarter mile west of Exit 17, This interchange provides access to Route 15, a primary northlsouth artery. The western boundary of the subject is along South Market Street, also known es State Route 114. The area to the north Is Improvod with vacant ground, High tension power Iinee, farms end corn fields, Soulhpolnt Office Center, single and multi- family housing and various commercial properties In the downtown area of the Borough of Mechanicsburg. To the east le a vacant parcel, also owned by Book-of-the-Month Club and a modern office buliding occupied by Della Denlel. Ta the west is single and multi-family realdential houaing, end to lha south le a mix of commercial and Industrial properties Including e distributionhnrerehouse occupied by Square D, Dave's Auto Repair, professional offices, retail sites offered for sale by CIR Brokerage Co., and AMP's Industrial facility. In summary, the subject locale le considered favorable due largely to Its exposure along and access to the Pennaylvanle Turnpike. Strategps ft 4~ .a 1a r~ T~ p~ r~ r~ ~~ *~'{ t; .: .~~ .t c ~ ~ ~ 'ate t 3`~ ./ IcNL°tw~l ~~' w•~ '~ 1 1 AayY1i"1{.. ... ~'t t F"~- ,,..,._,....~ "''" _.`.~+Y•,~i,,c~w ~.~t~i ~ ~w.~. ~~ ~~{~~ tirjljLL.'LtVI ~D I ~ .D• ILM1n '~.y~. ;Y°~,'C 1 .`, °~~.ND.. F` I ~ ' ~ _ .~y~, .. ~ ylli~`~ ~Y1 Yr ~k,.~ i, ~I .'~r~,,~',j.' }`-.V~r-X- r•".iS '"t ~ ` 4; 4 Y } ' i S :; ~.:'"`h ,,.. ..• \~R ` " ':: a ~'• : ~. •'1+ t 1~is~. ~ IL - ( nouttowy tV . ~ ~ 1 ~.' ' ~ L MOLL °j '1RN }'4 wNy - ACR[S •~ ~ `• t, , r ul •• Sj ~l~' ry i ~` Y I 1 4 ` ~IYII. .. y r .0 "`CtC 1 IL ff t J i otN H0~ ~ -" ~,J' ^ / Vv ~ ., a°PVb o1,D1 -M.i . ~ .ALL al'ter' - _w= t ~ ~ ~ ~ ' I '~~ ' Y a. r ~, ~\ .,. ~Gq. ~ V j r L ~~ ,, .L )iW •~ ~ y y \Y. N / y IMI ~ ~ e ' - , ,L .° 'I111N IYII.III~yyy.111IIII.yyy IW°1 v' ~ ''~~ ~ y Ji •~ [ML61 X4Y0'NO UlL IQ~. ~ ~ 5 4 ~I I ~ ,.IY. Y~ , r w+ NLL~ 1 RO[TOWN lM 1 °~+~•I~Im;+L 'Y•7~m,{o ' "- Y L E X S ~ ~1~11 Y~ lV W l~ /AIR cat ;(nlhLT_ \ • • E"i'L"lai ~- II ~ 1 ll OI~GR' ', Of SMOYNC~ P L { ~~ , •Y/ ~ OONTRY TFtw`~1 '~" ~ `. r ""'j IM ......... . / ~ ., 1111:4 yA ti.,, °-[ / 1..1.1 IMt[RLY ay [f TAT[S ~!'!' ~ r ~• u~oawl Iwwt; ° ` ~ O CN[STN VT IIILL ~ w R[5[fl OIR ~ NILL z :.:..; O q °linoviT , T' LLUNV¢w UM[NILN toL]It •~ V[N r~ ACR[S Lf ! u. N,. LLLLN ~ M ~ ww.a ,J'' 10p\ I1 Il in:hii°' Y ''~,f o.n~ 14 l '~' TILLY i ~iiii Lxnq ~Y' [ .tt~s• . ns.l ' y yL L ~ ~LYBR~ L~NL1L ~ ..__ __ ___... ... i.-- j V7 y '' . .' ~ -____ 1 5e ~F, '( / ~ ! e ~ f ~iW / Y I NoAU J~ t~ ,, ~ ca.Ll,.. w. tr....... .. pl,°...~..1 nn Location Map ~ 14 •a ~ SITE DESCRIPTION W i The subject site consists of an irregularly shaped parcel containing 68.28 acres. The tract has an estimated 1,1231 feet of frontage on the east side of South Market Street ,l (PA Route 114), and 1,6041 feet of frontage an the north side of I-78, the Pennsylvania ~ Turnpike. e4 The topography is level to gently sloping. Drainage appears satisfactory, and i landsraping consists of extensive lawn areas and perimeter landscaped areas with mature f f shrubbery and trees. f~ Public utilities, services, and site Improvements can be summarized as follows: Sanitary Sewer: Upper Allen Township. ~~ Water: United Water of Pennsylvania -Mechanicsburg Division. Telephone: Bell Atlantic. ~~ Gas: U.G.I. ~~ Electric: Pennaylvanla Power & Light. Rail Service: None. Cartway: South Market Street (PA Route 114) is a two-lane asphalt paved roadway. Sidewalk 8 Curb: None along road frontages. Concrete sidewalks along parking areas at ofnce section of the subject. Driveway and Parking Areas: Approximately 8.43 acres of paving which Includes ~~ parking areas and driveways. Fencing: None observed. !~ Easements of Record: Normal public and municipal utility easements are assumed. ( Flood Identification: The subject Is not situated in a flood zone per Federal Emergency Management Agency Community Number - 420372 0005C, dated February 15, 1980. Lend to Building Ratio: 7.89 to 1. I ~trate~s i IS As indicated, the subJect property has a land to building ratio of 7.69 to 1. Most modern ~ manufacturinglwarehousefacilities require a 4 to 1 land to building ratio. Therefore, the subJect property has excess ground for potential development. Based on the subJect building area of ~1 J 365,861 square feet, a minimum requirement would be 1,463,844 square feet or 34 acres rounded. Excess ground is therefore 32.28 acres. +1 ~i I Iii ~ Stratus iJ J J ~w~N ~• \\~~~ V r~ d~ 9~~ w _ ~~ ~ Z ~ t3 ~~ ~ ~ la. Z ~ \ ~d O ~ H Y y O ~ O U •v~_. -• ~_ 1 i 4 i '1 M lit 17 The subject is Improved with a 365,981 square toot one-story masonry and metal industrial bullding with 84,700 square feet of offices on the ground floor and the mezzanine level. The bullding is more fully described as follows: CONSTRUCTION DETAILS EXTERIOR Foundation: Poured concrete wall and column footings. Frame: Structural steel columns, beams, end web joists. Floor: 4' to 6' reinforced concrete Doors on grade and concrete on pan mezzanine. Exterior Walls: Original section is brick over concrete block (portion stucco over block). Warehouse addition and connector are insulated metal. Roof: Warehouses #1 and #2 have a metal deck with rubber membrane surface; remainder has standing seam Insulated metal roof. Truck Facilities: Total of 28 truck doors. 27 tollgate docks with levelers end seals and one ramp door. INTERIOR ~,;f Oftlce Area - 84,700 SF or 23% ~ Floor: Carpeting. Walls: Vinyl over drywall on metal studs. Ceilings: Suspended acoustical lfle calling with recessed fluorescent ~,~ fixtures. Rostrooms: Six restrcoms serve the office with separate men's and } ladles' serving the executive wing. An additional ladles' room is located t In the mezzanine level. ~ Plant/WarehouseAraa - 281,281 SF or 77% t^I Floor: Sealed concrete. ~ Walls: Exposed. r.~ Stratus b ., i r+ 11 I ti Cellings: Exposed. Lighting: Fluorescent. Restrooms: Four restrooms serve warehouses #1 and #2, and two restrooms serve warehouse #3. Stairwells: Threa prefabricated steel stairs serve the meuanine, Clear Height: Warehouses #1 & #2: 22' (11'6" under meuanine) Warehouse #3: 16' Connector: 22' Bay Sizes: Predominantly 30' x 40' In main building and 40' x 50' in rear warehouse. MECHANICAL ~~ HVAC: Office -eight heat pumps provide heating and air conditioning, plus original systems of heat or cold air via coil systems and air handlers. Warehouses -suspended gas-fired units provide heat In warehouses #1 and #2; package units in warehouse #3 provide heat and air conditioning, Electric: 6,000 amps (c~ 480 volts; heavy duty fixed conduit wiring. Fire Protection: Fully sprinklered. Elevators: None. LAYOUT: Building is divided Into office section, with cafeteria, restrooms, private offices, end open office areas according to owner's needs. In addition, there are three Interconnected warehouses. YARD BUILDINGS: One brick over block pump house building housing sprinkler system. Dimensions are approximately 8' x 10' plus 30' x 20'. Bu(Iding area is estimated to be 880 square feet. Q! V ~ Strateg~s I r I a~ ,I k~ It "1 E1 u ~' k! J 90' x 275' 24,750 SF 90' x 115' 10,350 SF 10' x 60' 600 SF 102' x 103' 10,508 SF 10' x 82' 820 SF 10' x 82' 820 SF 320.5' x 115' 38,858 SF 90' x 180' (Meuanine) 18,200 SF 512.5' x 241.87' 123,856 SF 98' x 180' 17,280 SF 200.5' x 602,5' 120,801 SF 178' x 20' .3,524 SF TOTAL BUILDING AREA 366,961 SF 19 Strateg~s w ^ z „ ~~ „ FdIH~IIf1 ~ucwyo~~ L' ii u r~a~ rv p .. , ~ a~ 61! o- u u v ~' ii ii ii ii ~r ~~ ~i c r~r. r. r . . ~~] ~ '~~i ~ ,¢^ m0 o {~J I ~ ~~' ' 0. 0 0 ,, ~ f~1 f ~~® f o 0 0, ~, ® o00 r r r r ,9 ~; v w { ~ . a o a r• a . e ~ y Y l ~ ~ . 1 1 1 H ~: ;O; F a s~~a ~ ~~ _a 0 o~~ROrt o- o- ~:0: ~ p- • • MGM,. DOB° • 0 •~ ~~088~8 rr,,~~ e i f ~1.ll O o ~ if 6 a a2~6~00D~ , , m~ o .®.. mm ~ ... mvs ~ ~ YA f~O® ' Lllf G{i 4"p L Q 0 ~ 0 bY.AY YY~r• 11 OfV•f Wr NA C ca a C .~ O :~ ii M P~ `i 1 t~ ~~ f~ I~ ~, t' 7 ~~ C1 to LLB I lit ~ "^. G c L ~ Q ~~ ; ~ ~mm~ `~ :® o M ~® ~ w P ~~ O ~ ~~ ~f ~ ~ wZ ~ =~ ~ : a zo E` ~ z- ~ l _ = I® ~ o m c \ ~ ~ - I ~®® ~e ~®4 ~ w n G ~® tl ~~aa ~1 M - Bc U[Yl~, w w N N ~ ~ O O w w t~ ~ H ~ ~ n ^^^ ~ ~ ~ .. ~ ~ e ^ 1---.1 i i i i Ie • ~ ! ! i OI 6 ^ ~ ~ i ~ ^ ^ ~ i i i 0 i I ~ ^ ^ ~ r ^ ^ ^ ^ ^ ^ ^ ~ ^ ^ ^ ^ } i • i S .~r....wow..y...~. .~ m M -, ., w ~1 i z2 The subject was erected in 1908 and expanded periodically through 1988. The composite physical age of the Improvements is, therefore, 22t years. The quality of construction is rated average, and the overall level of maintenance is on par with current ~~ standards. i rI 4~ f ~~~ Elements of depreclelion taken Into considerallon in the evaluation of the subject Improvements Include: Physical Deterloratlon: Several Items of deferred maintenance were noted in the office area including torn carpeting, painting, poor lighting, and roof leaks evident on ceiling tiles. Other physlcai deterioration is normal wear and tear caused by usage within the bulidings and action of the elements. Functional Obsolescence: The subject contains excess office space (23°~). Typical warehouse facilities normally have less than 10% of office space. Warehouse #3 has a 16' clear telling which Is very low by today's standards. This warehouse is also remote from the main warehouses #1 and #2. DlHerent bay sizes also contribute to additional material handling cost. Loading facilities are not centralized. External Obsolescence: Demand for facilltles in excess of 250,000 square feet is very Ilmitod. Most facllitles of this size ere being built according to custom specifications. The market would indicate that potential users for this size would prefer to build unless they can buy at a level that makes economic sense (I.e., cost to convert to their own specifications). C~ Rti I tf Strateg~s V ti 23 1 1 nwtiFRSHIP AND RECENT_NIS798Y I I The subject property is owned and occupied by Book-of-the-Month Club, Inc. The facility Is used for offices, warehousing, packaging, and malting of books. I The subject property was ecqulred by Book-of-the-Month Club, Inc., on Mey 8, 1978. This transaction is recorded in Deed Baok W27, Page 280 In the Recorder of Deeds' Office in F~ the Cumberland County Court douse located in Carlisle, Pennsylvania. No transfer of thla 1 parcel has occurred since Mey B, 1978. F~ 1' REAL EGTATE ASSESSMENT AND TAXES ~~ The subject is assessed for a total of $882,500, allocated as follows: ~_~ Land $134,500 Improvements $728,000 ~~ The current tax rate is 18.55%, indicating an annual tax Ilablllly of $142,744. The current STEB ratio is 7.5°~ indicating a market value by the county of $11,500,000. ~~ The subject property la zoned IN -industrial District under the Upper Allen Township jf zoning ordinance. The existing improvements appear to conform to applicable lot and building ~?i regulations, and the current occupancy appears to be a legal use of the lend. I Permitted uses in the "IN" classification Include, but are not limited to, auto repair and ~ sales shops, banks, hospitals, manufacturing plants, end warehousing and storage. g~ Appropriate portions of the Upper Allen Township zoning ordinance are found in the Addenda. ~ The subject is considered conforming to zoning. dl ~ Strateg~s ~ .., u ~~ ~ c = ~~~ ~' 1 ~' ~ I ~; ~ y y ~ 4 U o ~ ~~ ~ ~1~• w ^ (~ ~~ .. ,,t + n ~ a I y Y • ~ ~ It a: u9' A~ ~ '~ of r J~ ` I . ~ 4• t 10+~ o ~ ~ '~ I Z N ~ ~~ • ~ / ~ J ~ I S , _ \ 11 ~ '1. 410 n~ I r ~ ;, g o to s r X qt y s~,` 11 ~ _ ~ ~~ ~ *~ ` 3 y1 ott3~ltl F i~r ~ ~ a Y I .~ 1d /y \ ' f ~ 1 1 1 ~ y 'tu i b ~ Z ~ (~ ~ ~ ~ Q ~ . I 1 m = N U ~ Y ';- •Ya iy Y.. r ~ t- w i ~ ~ O ` 1 ~ Z t7 1 ~ O ~ 1Y ]p+ ~ ~ ` 1 1 G 90 ~ fV~ . / 4 C ~ 1 x 1 . o' = t 1 x m ~ ~ ;1 ~ - 1 i w vi N ~ ~ 1 SQ 3 1 ~ _ ! K J OMa7Y t, 1 ~ ~ ggblg6 ~ gas 1 Z 1 t tirJW u G Y~r ~15 y ~ O1 , = W 1 , I flr ~ r [[ Y„ , 1 d~ .a = a Y +• n. _ 1 O t, i ~~1 w '~L~ ~ ~ - ~ j ~ 2t~ 1 ]~Y YOf 11Y r r+ i ^ ~ o c •/~i/ J ' ~ Z'. L ~ `~ u• o Ii~01i Y' ~ • 1 ~/y ~1 c ~~YG ~'', , y I LL W 1f O or ~• f y+ I,. 1 .- o .. i ~ . ~~~ ti~ ;;~ ~..a ~. ...~" ~ ~ ~ u' '~ M ~ ~ ni ~ t ~ ~Y 't 1 ]~~iY~ aiofo~ ~..~~ !A m~ i t IG ,~ d Zoning Map -, a ~r rV i t~ Ij la iI 2s The first step in valuation Involves the determination of the highest and best use of a property which is defined as the most profitable, likely, and available use to which a property can be put. An analysis of highest and best use considers alternative programs of development among potential uses which are: 1. physically possible, based upon topography, land area and site configuration; 2. legally permissible, in compliance with zoning, deed restrictions, or other constraints; 3. economically feasible, and fulfilling an Identifiable demand in the market; and 4. maximally productive, thus resulting in the highest land value, Viewing the subject from the standpoint of the marketplace for industrial facilities similar to the subject property, we have analyzed the above criteria and refined the definition of highest I ~ and best use. Physically Possible -The possible use of a property is dictated by the physical aspect of the site. Size, shape, area, and topography of a parcel of land can affect the uses to which it can be developed. The highest and best use of a property as Improved also depends on physical conditions such es size, design, and condition. Condition of a property and its ability to continue In its current use may be relevant. If a property should be converted to another use, the cost of conversion must be analyzed. From the standpoint of the land as vacant, the site is suitable for any type development allowed under zoning. The siie has excellent frontage and access along South Market Street and excellent exposure along the Pennsylvania Turnpike. The subject was designed and built as a user oriented industrial facility and is functional in that regard. f~ I M I r,f r.A 2. Legally Permissible -The usa must be legal. If the highest end best use of a site or property is not allowed under the current zoning, there must be a reasonable probability that a change In zoning could be obtained due to shifting economic and social patterns. Other considerations Include environmental regulations as well as the reactions from local residents in determining the highest and best use. The subject is located in an Industrial zone and, as previously Indicated, appears to conform to all land and building requirements and Is therefore legally permissible. Stratus 2G ~y 3. EconomlcallyFeaslble -After determining which uses are physically possible and legally permissible, some uses are eliminated from consideration. Then the uses "' that meet the first two criteria are analyzed further to determine which are likely to ' produce an income. All uses that are expected to produce a positive return ere regarded as financially feasible. To determine finenclal feasibility, we then estimate '~~ the future gross Income that can be expected from each potential highest end best ~ use. Vacancy, collection losses, and operating expenses ere then subtracted from each gross Income to obtain the likely net operating Income (N01) from each use. A c~ rate of return on the Invested capital can then be calculated for each use. If the net i revenue capable of being generated is enough to satisfy the required rate of return an Investment and provide a return on the land, the use is feasible within some price i limit. Considering the physically possible and legally permissible uses permitted, we 4~ balieve that the present use is the most financially feasible. 'I 4. Maximally Productive - Of the financially feasible uses, the use that produces the i t highest and best price or value consistent with the rate of return warcanted by the J market for the use is the highest and best use. To determine the highest and best use of the land as though vacant, the same rate of return is often used to capitalize i Income streams from different uses Into their respective value. This procedure is i ~ appropriate if all competing uses have similar risk characteristics. The use that produces the highest value Is the highest and best use. The subJect property meets all tl~e requirements of the first three criteria. The subJect clearly is producing an economic return to the present user. An analysis of comparable sales { also indicates that the subJect would remain a viable industrial facility as an alternate use. In other words, the subJect property as an Industrial facility would yield the highest residual lend value. ~ ~ Under the four criteria, the subject meets all the tests for continued industrial use, and (~ therefore Is the highest and best use of the subJect property. J t~! I r! Es Stratus A~ W i i Hr .~ ~~ 4 ' Eat { z~ The three traditional approaches to value have been considered in the appraisal of the subject property. Each of these approaches has varying degrees of applicability depending upon the specific characteristics of the property being appraised. The Sales Comparison Approach considers prices actually paid for similar properties, negotiated between Informed participants in the marketplace. Although few properties offer exactly the same physical or locational characteristics, most transactions can be reduced to a common unit of comparison which is then refined end adjusted for pertinent differences. The rellabllity of this approach depends upon the quantity and quality of the market data available for comparison. The Cosf Approach produces a value which is reflective of local construction costs and land values. This approach is based on the theory of substitution, which essentially states that an Informed Investor would pay no more for an existing Improved property than the coat of producing a substitute property with the same utility. The market value thus derived assumes that the summation of the land acquisition, the depreciated value of any improvements, and the attendant development costa, is equivalent to their contribution to overall property value. Tha Income Approach has traditionally been considered most responsive to the requirements of lenders and Investors, as this approach produces a present value based upon a projected future Income stream. A survey of the Iocai market, focusing specifically on properties which are most competitive with the subject, substantiates the Income and expense projections which are set forth. Net operating income is converted to market value by a capitalization method that considers the characteristics of the Income stream and the type of property being appraised. In the subject analysis, principal emphasis has been placed on the Sales Comparison l1 I h1 I M EH and Income Approaches. The Cost Approach was considered but not processed due to the age of the subject and the difficulty in accurately estimating the appropriate depreciation from all sources. Numerous factors contributing to the value of the subject have been weighed in each valuation approach. The following considerations are relevant to this analysis. $tCdtE~S 2s Accesalbility and Locatlonal Attributes: Tha subject enjoys excellent visibility along the northern frontage of the westbound lanes of the Pennsylvania Turnpike. Access to W the site Is approximately one quarter mile west of the exchange. Additionally, ~ U.S. Route 15 is approximately one quarter mile east of the subject. N { ~j 'I f•~ E~ t~ I rt ee r Compatibility with Surrounding Land Uses: Land uses near the subject are mixed. On the northern side of the turnpike, the subject more or less stands alone with Immedletly adjacent parcels vacant or used for farming. To the south, however, a number of commercial or industrial properties are located. Property Characteriatlcs: The land to building ratio, et 7.89 to 1, is considered high. Topography of the site is adequate for supporting additional Improvements and ell public utilities are currently available. Functional Adequacy of the Improvements: As previously noted, typical office space for industrial warehouse buildings is less than 10°k. The subject facility contains 23°~ which is considered excessive. Additionally, by modern standards, ceiling heights are low end loading facilities are found at several elevations of the building. Demand Relative to Supply: Size alone restricts the market for an Industrial facility such as the subject. An Investor would have to consider the difficulty In locating a single tenant for this large block of space. An allemative would besub-division. However, this would require considerable expense. The marketing time for sale or lease Is a factor to consider. It is estimated that this period could be 12 to 24 months. Strateg~s ., ~. a 1 W k~ ti !~ criteria: ~~ ~~ f~ k~ ~~ ~~ H~ i El t9 z~ The Selea Comparison Approach is a method of estimating the market value of a subject property through an analysis of sales of similar properties. Sometimes referred to as the Market Data Approach, this method assumes that sales of comparable properties, having similar physical and locatlonal attributes, provide a range of value for the subject. The credibility of this approach depends upon the accuracy of the data collected, as well as the degree of comparability between each sale property and the subject property. Properties which are acceptable for comparison with the subject meet the following 1. Only arm's length transactions between two unrelated parties are considered, with neither the buyer nor seller being under compulsion to act. 2. Details of the transactions are reliable and have been verified to the greatest extent possible w(th the parties Involved. 3. The comparable properties exist in the same competitive market as the subject, and represent competitive Investment alternatives. The boundaries of the market may be defined by physical or locatlonal characteristics, income generating capability, functional utility or a combination of these attributes. The selection of a unit of comparison provides a common denominator by which market sales can be related to each other and to the subject property. The commonly accepted unit of comparison In the valuation of industrial real estate is the selling price per square foot of building Including the land. This unit of comparison emphasizes the contribution of the building mess and the contribution of the land merged Into the unit's selling price. While a diverse array of transactions was initially considered, the sales selected for direct comparison to the subject are those transactions which are most similar to the subject. For features which are dissimilar between the sales and the subject, adjustments have been Strateg~s r 30 made leading to en Indication of the price at which the property being appraised could be expected to sell. Five sales of industrial buildings are Identified on the following pages and, based on our inveatigatlon, these sales ere considered to be the most signl0cant transactions for direct comparison with the subject. A summary chart precedes the detailed description of each eels. Strateg~s +. M ~~ I ^~1 k~ I, R~ ~~ i -: ~~ F~ F-~ a ~~ c~ ~ zap ;, W ~UfJ .- m ~ n m ui o N ~ ~ v ~ ~ "~~~ Nay h h N N N ~~~, a 3~x .. $ ~ a Zv 25 0 'o- a g °o v ° o .- ~ in ~ r ~ ~ ~ w ~ ~?~ Z ti a o o m v .- o p m ~ p m N N t n V N m O N ? ~ Q V O N a0 ' ' 7 a U N V N M ~ Q ~ ~ Qy1 l~ M O N Qi ((N~~ Q ~- ~- v e- O e' p U? a ~ U ~ d o W p a ~ ~~ ~ ~5 c E .n°a ~V c ~~ Ep ~,8 W ~. p U~, N~p ~.y QQ ~ q V ~ e d ~ 7 ~ fA ~ LL. W U ~ L.R. °i LL Op ~ O Ym Z r d U Kfn LL . " ~ La = aL 10 ~ B a a t= ~ a '~ p e o ~ g m . ~n o ¢ ~Qn. ~~ 4 ~ ' ~ B~c ~~z ~~~ = v= ~L ~ B ~~r ~ c yam ~~~ v ~ C~ V p E~ _ c~ 9 C~~ ~y~ GG yS 6 ~~6~j~ 5 ~~N Uy~ LLyy 8 ~~ ~~ ~7~ L N W .N-m~U U Zlim r~ of LL~.~ ~~U Z r N 1h a N ~. 31 M ~ IMPROVED SALE NO. 1 760 MOORE ROAD Continued UPPER MERION TOWNSHIP '"~ MONTGOA1ERY COUNTY, PA 33 I IAND DESCRIPTION: r•~ Shape: Irregular ~ Frontage: 677' on the north side of Moore Road and 1,838.6' on the east side of Valley Forge Road ~ ~ ~ Topography: Level at Improvements; moderately to steeply sloping at perimeter of site Utilities: Public water, on-site sewer, gas lines, and electric ~~ Rail: Yes BUILDING DETAILS: t1 I ~ Bullding Type: Warehouse No. of Buildings: One I i No. of Stories: One-story with second-story office I; Foundation: Concrete Framing: Steel f Floors: Concrete ~ Walls: Concrete block, brick Roof: Built-up cover; flat steel deck Percent Office: 5.00% or 12,344 square feet ~~ Bay Sizes: 25' x 25' Clear Heights: 23' tiVAC: Oil-fired hot water boilers; majority of offices cooled by I~ wall/window mounted units Sprinklers: Full Truck Facilities: 38 tailgate, two drive-in, one ramp, and nine rail loading doors. Year Built: 1965 Condition: Average REMARKS: Bullding located In the King of Prussia Industrial Park. M J Strateg~s ., i 35 r I IMPROVED SALE NO. 2 1200 WILSON DRIVE Continued BRANDYWINE INDUSTRIAL PARK r4 WEST GOSHEN TOWNSHIP j CHESTER COUNTY, PA LAND DESCRIPTION: Shape: Irregular Frontage: 80' on the terminus of Wilson Drive and 238' on the east side of p, U.S. 202 (Access only from Wilson Drive) ~ ~ Topography: Gently sloping Utilities: Public water, sanitary sewer, storm sewer, electric, end gas t~ Rell: Nane 1 BUILDING DETAILS: ~~ Building Type: Light Industrial No. Of Buildings: One No. Of Stories: One-story with two-story offices ~'~ Foundation: Concrete Framing: Structural steel Floors: Concrete ~~ Walls: Insulated metal panels with glass at office section Roof: Rubber membrane roof cover on slat metal deck Percent Ofnce: 15.5°~ or 92,460 square feet Bay Sizes: 20' x 40', 20' x 30', 34' x 3B', and 41' x 34' Clear Heights: 16' to 28' HVAC: Oil-fired boilers; roof mounted air conditioning units Sprinklers: Full Truck Facilities: 18 tailgate truck doors and one drive-In door Year Built: 1974 & 1988 f~ Condition: Average REMARKS: Not Included in the gross square footage is a 347 square foot concrete block pump house. Offices and meJority of warehouse k~ and former manufacturing space are air conditioned. ~ Prior to the sale, the facility was utilized by Commodore as e ~ single-occupant Ilght industrial/office facility. OVC will use the fecllily for offices and warehouse space, J t:d i r,~ M Stratus 1/ ., 37 I IMPROVED SALE NO. 3 NEW FORO MILL ROAD Continued FALLS TOWNSHIP "~ BUCKS COUNTY, PA i LAND DESCRIPTION: W Shape: Rectangular ~ Frontage: 1,100' on the east side of New Ford Mill Road Topography: Generally level and slightly above street grade E~ Utilities: Water and sanitary sewer provided by USX. Electric, gas, and telephone service. Rail: Available F l~ BUILDING DETAILS: I Building Type: Manufacturinglwarehouse ~ ~ No. Of Buildings: One No. Of Stories: One g Foundation: Concrete ~ " ~ Framing: Steel Floors: Concrete Walls: Concrete block and metal panel ~~ Roof: Single membrane rubber and built-up asphalt roof corer on steel deck Percent Ofnce: 3.9% ar 18,528 square feet ~~ Bay Sizes: 40' x 40' and 20' x 20' Clear Heights: 18.5' to 28.5' HVAC: Suspended gas-fired units Sprinklers: Full Truck Facilities: 16 tailgate truck doors, 1 drive-in truck door, and 3 rail doors Year Built: 1968 j~ tt~~ Condition: Average REMARKS: This property was sold by K-Mart to Swann Ltd. Partnership in June 1989 for a consideration of $9,400,000 or $19,85 per square foot. K-Mart provided the financing to the purchasers, en Investment group, who filed for bankruptcy. Upon a decision by the bankruptcy court, K-Mart regained title to the property and subsequently sold It to Blue Chip Development, a re-manufacturer of auto parts. The sale price, between 1989 and 1994, decreased by $1,855,000 or 17,8%, from $19.66 to $16.20 per square foot. In addition to the main building, there are four support buildings totaling 5,812 square feet. ~ Stratus ~1 I W i IMPROVED SALE NO.4 Continued -~ !i If ~J i~J J LAND DESCRIPTION: Shape: Frontage: Topography: Utilities: Rail: BUILDING DETAILS: Building Type: No. Of Buildings: No. Of Stories: Foundation: Framing: Floors: Walls: Roof: Percent Office: Bay Sizes: Clear Heights: HVAC: Sprinklers: Truck Facilities: Year Built: Condition: 39 53 HATFIELD ROAD FRANCONIA TOWNSHIP MONTGOMERY COUNTY, PA Irregular 670' along Township Line Road Genlly sloping and at street grade Public water, sanitary sewer, storm sewer, electric, and gas Yes Warehouse One One Concrete Steel Concrete Masonry and metal clad Flat rubber membrane roof cover on steel deck 8.54°~ or 14,000 square feet 40' x 80' 19' Oil-fired end gas-fired unit space heaters Full 13 tailgate truck doors, 2 drive-in truck doors, and Interior rail siding 1958 Average REMARKS: This property Includes a 1,000 square foot mezzanine level office and leb. The production area Is 72,000 square feet, and the warehouse area comprises 127,200 square feet. Asphalt paved parking for 200 vehicles, containing 26,000 square feet. The properly was on the market since August 1990. ~ Strateg~s w ~ IMPROVED SALE NO. 5 Continued M i~ !I tl p1 11 I' ~I 15 PLEASANT VIEW DRIVE MECHANICSBURG CUMBERLAND COUNTY, PA 41 IAND DESCRIPTION: Shape; Irregular Frontage: 1,883.14' on the south side of Pleasant View Drive Topography: Generally level Utilillea: Public water, sanitary sewer, storm sewer, electric, and gas Rail: Yes BUILDING DETAILS: Building Type: Warehouseldistribution No. Of Buildings: One No, Of Stories: One Foundation: Concrete Framing: Steel Floors: Concrete Walls: Concrete block Roof: Single membrane roof cover on flat steel deck Percent Office: 0.7% or 1,844 square feet Bay Sizes: 41' x 92' Clear Heights: 24' HVAC: Gas-fired suspended units Sprlnklere: Full Truck Facllilles: 17 tailgate truck doors, 2 drive-in truck doors, and 2 rail doors Year Built: 1969 Condition: Good REMARKS; Original asking price was $8,000,000 ($22.00 per square foot). ~ Strateg~s A I A i 1~ i is it ~~ ~l 42 t~pg-ysis and Summary of the ImRroved Sales The sales that have been utilized range In size from 214,000 to 594,908 square feet, bracketing the subject size of 365,981 square feet. These sales occurred between September 1992 and October 1994. Unadjusted, these sales indicate a range In unit selling prices from $14.72 to $18,81 per square foot of gross building Brea Including the land. An analysis was done in order to close the physical end economic differences between the sales properties and the subject property. Adjustments were made based on the following characteristics and elements of comparison. Real Properly Rights Conveyed - A transaction price is always predicated on the teat property Interest conveyed, Many types of real estate, particularly Income-producing properties, are sold subject to existing leases. The revenue-generating potential of a property is often fixed or limited by the terms of the existing lessee. In the valuation praceas, adjustments must be made to reflect the difference between properties leased at market rent and those leased at rent either below or above market levels. The lengths of remaining lease terms affect these adjustments. Finance Terms -The transaction price of one property may differ from that of an ~°J identical property due to different financing arrangements. A financing adjustment may or may not Include an adjustment far conditlons of sale. J conditlons o/Sale -Adjustments for conditlons of sale usually reflect the mol(vations of the buyer and the seller. In many situations the conditions of sale significantly affect transaction prices. When nonmarket conditions of sale are detected in a transaction, the sale can be used as a comparable only with great care. The circumstances of the sale must be thoroughly researched before an adjustment Is made. Market conditlons (Time Adjustment) -Comparable sales that occurred under different market conditions than those applicable to the subject on the effective date of the value estimate require adjustment for any differences that affect their values. A common adjustment for market conditions is made far differences occurring since the date of sale. Since the time the comparable sales were transacted, general values may have appreciated or depreciated due to Inflation or deflation and Investors' perception of market conditions may have changed. Source: The Appraisal ojRcal Estate, IOtli Gdition, The American Institute of Renl Estate Appraisers, Pages 374 - 3R3. Strateg~s i 43 w ~ Locatlon - An adjustment for location may be required when the characterlatica of a comparable property are different from those of the subject property. Location ~ adjustments are usually expressed as percentages that reflect iho Increase or decrease I in value attributable to the property's location or neighborhood. ~M Physlca/ Character/stlcs - If the physical characteristics of a comparable property and 1 the subject differ In many ways, each of these differences moy require comparison and adjustment. Physical differences may Include building size, quality of construction, w architectural style, building materials, age, condition, funcllonal utility, site size, I attractiveness, amenilles, and on-site environmental condition. b~ These adjustments are summarized In chart form on the following page. I Mq 11 ~I ~I ^ J ~ Strateg~s '1 ~~ I A 1 tl ^1~ ~~~5~. i i ~ ~ 0 V o N v v v '~s ~ / N h N ~~ ~ ': ~~ :.r~. ~a~f ..I ~ QOl OOi ON1 O OOi Ae O } ~~ i 9 h ~ O N X19 ~ ~ O ~ y' m~ ~ 4 ~ + 4 + + J F Q ~ ~ ~ ~ ~ + ~~ N ,,y,1, Y y~1, Y y,,I, Y y,,1, Y y,y Y Z ; g~ ~ ~ ~ ~ , 8 W ~ U ~ ~ ~ ~ ~ N v ro ~a w w a n w C~ O F ° m s v .n ~ n n ~ ~ v ri d r cv . ] m ~ ~ zw n o v °o ro m .- o m ~ ~ m ftpp N ~ R N N ~ ~x sNs~~ Y O O ~/1 N ~O~pp a0 g 01 ~ ~ ~ u ~ N V N ~ ~ {~J of ~ fn N O ~ ~ O e ~`~ ` ~ O aS ~ r,..... 44 M 1 i n I a1 ~i tt i1 as Adjustments were based on data in our files and the Judgment of the appraisers. Due to the imperfections of the marketplace, our adjustments are not documented by paired sales which do not exist. They were made on the basis of experience, reasonableness, and common sense. Real Property Rlghta Conveyed -All comparable sale properties were conveyances of fee simple estates. Finance Terms -All properties were cash transactions under normal economic conditions at the time of transfer. t~ No adjustments were made by the appraiser for the above elements of comparison. If Conditions o/Sale -Minus 5% adjustments were made to sales 2 and 5 for motivation f~ of buyer. Both sales were acquired for expansion and consolidation needs of the 1~ purchasers according to newspaper articles. Market Conditions (Time Adjustment) - No adjustments were made for time. It is our ~~ opinion that industrial properties have been stable to declining since December 1989. Size - A plus (+) or minus (-) adjustment of 5°~ was made for differences in size of 100,000 square feet more or less. Plus was made for those facilities that were larger than the subject by 100,0001 square feet or more and minus was applied to those sales that were 100,0001 square feet smaller than the subject. Land to Building Ratio -The appraiser is treating excess land for the subject property and therefore adjustments are made based on the subject having a 4 to 1 land to building ratio. Plus 5% adjustments were made to sales 5 and 7 for having less than the standard, and minus 10% was made to sale 6 for having more than the standard 4 to 1 ratio. Local/on -Adjustments in Increments of plus (+) or minus (-) 5% were made for turnpike location and access to same. Phys/cal Character/stlcs -Adjustments in Increments of plus (+) or minus (-) 5% were made for such features as condition, rail, construction, bay sizes, configuration, ceiling heights, and office space. This Is based on ttre principle of economy of scale (i.e., that price per unit decreases as the number of units increases. Strateg~s i r~ ^1 j a~~ After the adjustments of our comparable sales, the indirated unit prices range from $14.37 to $15.48 por gross square foot of building area including land. All of the similar and dissimilar features between the subject property and the W ai j Ij comparable Bales have been considered. Based upon the preceding analysis, we estimate the market value of the subject property to be $15.00 per square foot of building Including 34 acres of ground or $5,469,415, which we have rounded to $5,500,000. We have allowed a land to building ratio of approximately 4 to 1 for the Improvements which results in excess ground of 32.26 acres. Based on the comparable land sales which are found in the Addenda, we estimate the market value of the 32.26 acres of undeveloped excess ground to be $50,000 per acre or $1,813,000, which we have rounded to $1,600,000. Therefore, the total value for the subject property, including excess ground, is $7,100,000. ~7 t"1 I N I i a VALUE INDICATION VIA THE SALES COMPARISON APPROACH 57,100,000 Strateg~s w w W j q t M-~ i~ t~ tJ ~', ~! ~' J J a~ The Income Approach assumes that the value of a property is equivalent to the present worth of anticipated benefits to be derived through ownership. The benefits to owners of Investment real estate ere assumed to occur over a measurable holding period end consist of e stream of net Income (return on Investment) plus a reversion (return of Investment) upon sale or refinance at the end of the holding period. The process of converting Income Into value is known as capitalization. Two capitalization techniques are often cited in the valuation of Income-producing real estate. Direct cap/tallzadon converts one year's stabilized net income Into value by dividing that Income by en appropriate overall rate. This method is applicable to a variety of property types where the Income will remain relatively stable, or where Income streams and/or property values are expected to change at a constant rate. The selected capitalization rate inherently Incorporates the avallabilily of mortgage financing, required equity dividends and the potential for capital appreciation. An alternative method of income valuation is y/efd capitallzatlon, also referred to as discounted cash flow. Yield capitalization is most appropriate for Income streams that do not conform to a pattern, as each periodic Installment is separately discounted. The discounting process requires the practitioner to make individual decisions regarding time preference, liquidity, uncertainty and risk, utilizing a rate that is attracting purchase capital to similar Investments. In the analysts of Industrial property, direct capitalization is the most easily understood method and is most often employed by market participants. The flret step in the Income Approach is an analysis of the regional market rentals, which Is essential to a projection of Income and expenses. Strateg~s X18 .. ' Discussion o1 Market Rent ~ In valuing the subJect property, we have analyzed the region's Industrial market In order i to estimate a market (or economic) rent for this facility. Market rent is defined as the rental g'1 I Income that a property would most likely achieve on the open market, generally indicated by the !`~ rents currently being paid for comparable properties. I A summary of comparable rentals Is included on the next page, followed by detailed k~ ! descriptions of the comparable properties. t'~ 14 ~~ tai L3J ~~ ~ Stratus 1 ~I q it 17 11 0 1~ J J i..:.= U1 zzzzz ZZZ ZZ .~ ? r~ y: ,~-. -. K LL a (j Z z s~ ZC02iZ~ O W N V~ Z z Z o z~ T Z z Z z . F ~~ Z O .- VI h VI VIN Z Ih m Z O N Z N N Z M m ~~ ~ ~ ~ ~ ~ ~ ~ ~ NM V In N ~ ~ ~1 [ N~ N o hC{ u` 1N/1 ( ~ Vi W 0 >-r>rr ~ ( ~ ~ Q ~ 'Q 10 O N O m uJJ N uNi r u~i M ~+m~vlI 1h N ~ ~~pp 'V' p~j O ~ ~ T~ T T ~ T T T O f~1 ~ N N IA V7 r ~ (Q ~ ~ QpN~1 N ~Q31 W J ~ O O O O O w O W os Z ~ ~ ~ ~ $ (A O~ ~ ~ ~ ~ C T C CI E r y C ~~ ~~ y E .~ ~ •- ~ c~~ ~ Y ~ o ~~ ~ _ ~!~ Nr'7 rn ~~ ~~ p C g V S C~ o $ $ ~ o ~ ~ ~ O ~ m ° L _w ~ d ~ E'~ m Q ~ & ~ Q a , ~~~ m VI::~a a~ ~ T a a L ~ ~ a ~ a r ~ tc B~8 o~ c `~~ ~ g a' ^c `~ g ~ o~ LQ ~~°' ~ua. °7pj~ c c c "'_ ~ ~ °a a Ea'~ _ ~:~ ~~U ~~~ c o ~ ~~ , 8~~ ~~ ~~r m~~ ~ o ~ yy ~ ~ Z .- N M O V1 ~D ~ w .~:. 49 ., ;~ ., sz ~ LEASE NO. 2 TROOPER ROAD (RT. 383) Continued VALLEY FORGE CORPORATE CENTER X19 LOWER PROVIDENCE TOWNSHIP ~ MONTGOMERY COUNTY, PA ;I SIZE: 352,458 square feet iN i REMARKS: Renewal options at following rent: Extension Term Rent First Year $800,000 or $1.701SF Second Year $650,000 or $1,84/SF Third Year $875,000 or $1.92/SF Fourth Year $775,000 or $2.201SF Fifth Year $825,000 or $2.341SF Purchase option during renewal period at $7,000,000. ~~ ~~l ~`l ~~l J ~ Stratus .~ i 55 wl + LEASE NO.4 LINCOLN HIGHWAY AND LIBERTY STREET Continued HOMETOWN BOROUGH SCHUYLKILL COUNTY, PA REMARKS: Rail service end 2,500 square foot office in other section now leased by Style Crest. ~ ~ Extensive renovations made for tenant including insulation of metal walls, heating upgrade end painting. ii L~l J ~ Strateg~s `l '1 r~ Jr Ill ss Summary Of Market Rent The preceding comparable rentals Indicate a range of $1.01 to $2.83 per square foot triple net. In comparing the subject "as is" to the above rentals, consideration was given to location, size, age, condition, utility, term, and quality of the tenant. Typical lessee are written on a five year basis with the tenant responsible for all operating end fixed expenses. The landlord responsibility is rental commission and structural maintenance. Lease One is the most recent lease and is actually located across from sale 4. Upward adjustment for location and downward adjustment for size are indicated. All other features were considered equal. Overall, the subject could command a similar unit rate. Lease Two is the next most recent lease and averages $1.28 per square foot per year over the five year period. The location is slightly inferior due to the lack of tumpike frontage. The size is comparable, but overall condition, utility, and age are inferior. Overall, the subject could command a higher unit rate. Lease Threb is located across the tumpike from the subject. The rental represents a build to suit. A substantial downward adjustment is indicated. Overall, the subject could command a lower unit rate. Lease Four is a smaller facility not as well located as the subject. However, it was extensively renovated prior to the tenant taking possession. Utility and condition were superior to the subject. Overall, the subject could command a similar unit rate. Lease Flve is larger and of better construction than the subject. Location is slightly inferior due to the lack of turnpike frontage and visibility. Overall utility is also superior to the subject -heights, bay sizes, and truck doors. Overall, the subject could command a lower unit rate. Lease Six is also a build to suit, and the rental reflects this. This property was built as a distribution center, and overall utility is superior to the subject -heights, bay sizes, and truck doors. Overall, the subject could command a lower unit rate. Stratus 59 A The subject property is presently owner occupied and is the type of facility that would most typically be leased to a single user. Based on our analysis of the above market rentals, Il Is our opinion that the subject A property could be rented for $2.15 per square foot on en absolute net basis or $788,818 annually. The next step In an Income Approach is the analysis of vacancy and landlord expenses. Vacancy and Credit Loss We estimate a 5% stabilized vacancy and credit factor. The appraisers ere unaware of any industrial vacancy surveys for Cumberland County. However, competitive, more populous counties such as Lancaster, Montgomery, Bucks, Chester, and Delaware have industrial vacancies ranging from 10% to 20°~. Our estimate of 5% is therefore conservative. Expenses Management and Leasing Management expenses far a property of the subject's type are typically 3% of the effective gross Income. Leasing costs are over end above management coats. Based upon typical costa for leasing a building in the general central Pennsylvania area, an additional allowance of 4% of effective gross Income is allocated for leasing costs. We, therefore, deduct 7% of effective gross Income to account for management and leasing fees. Structural Reserve A property owner must replace certain exterior building components (roof, ! exterior wall, HVAC, paving, etc.) over time to maintain the facility in operating condition. ~ Strateg~s +i ~.1 fl I l~J 60 Buildings of the subject's size and characteristics can reasonably be expected to require an allowance of $0.25 par square foot per annum to provide for a consistent level of maintenance. Select/on of a Capltallzatlon Rate In selecting an overall rate of return necessary to attract capital to a real estate Investment, the following factors warrant consideration: 1. The rate of return that is available on alternative Investments, such as government securities, corporate bonds, and mutual funds, as well as the attendant risks to these Investments, 2. The avallabllily of mortgage financing and the potential for equity build-up through debt reduction. 3. The potential for capital appreciation due to increasing property values. 4. The tax conaequencea of real estate versus alternative investments. 5. The quantity, quality and durability of the Income stream under investigation. An overall capitalization rate derived directly from recent property salsa Inherently reflects the market's reaction to the above considerations. As the market data In this Instance was inaufiiclent to derive overall rates from comparable sales, the overall rate Is calculated via the band of Investment -debt service methodology. acceptable sources of data for capitalization rates, Interest rates, amortization terms, debt We have relied on and researched the following national publications that are generally coverage, and constant rates. The publications are: • Crittenden Reports -Income Property Rates June 1994 • National Mortgage Commitment Survey -Developed by the Research Department of the Appraisal Institute -May 1994 • Investment Bulletin Fourth Quarter 1993 • Korpacz Real Estate Investor Survey -First Quarter 1994 Stratus 61 In addition, we have researched lending policies of local banks. The following were the ^ results of our investigation: i~ Interest Rates 7.15°h to 10.25°h Amortlzallon 15 to 35 years Debt Coverage 1.35 to 1.90 Capitalizallon Rates 9.0% to 13% A For the subject property, we havo concluded that a 8.75% Interest rate, 25-year amortization, (9.87% debt service constant), 70% loan to value ratio, end a debt coverage factor of 1.50 is appropriate and well within the range of the market. Our capitalization rate was developed from a Band of Investment -Debt Coverage Formula Technique as follows: Debt Coverage Debt Service Laan To Ratio x Constant x Value Ratio =Overall Rate 1.50 x .0987 x .70 = .10364 In addition to developing a capitalization rate from a debt coverage formula, we also de•~ra!uf:ed a capttauzatlon rate using the Band of Investment -Equity Yleld methodology. This methodology Involves two steps. The initial one is the calculation of a basic capitalization rate. This rate is then adjusted for future changes in Income and value and for equity build-up j~ through amortization. !!~~ The calculation of the basic capitalization rate assumes that a potential purchaser could secure an 8.75% interest rate mortgage for 70% of appraised value for a term of 25 years J ~ Strateg~s r G2 (indicating a mortgage constant of 9.87%), and that the required yield to attract Investment in A the subject would be 15.00%. The basic capitalization rate was developed as follows: Mortgage Interest Rate 8.75% Mortgage Term 25 years Annual Constant Percentage 9,87 Return to Equity Position 15% Loan to Value Ratio 70% ^ b~ Mortgage .70 x .0987 = .08909 Equity .30 x .1500 = .04500 Basic Capitalization Rate .11409 I~l The basic capitalization rate is then adjusted by a factor to account for changes In property value and for equity build-up through mortgage amortization during the holding period. The following adjustments assume that the subject's property value will rise 1% annually over e 10 year projection period, or a total of 10°h. It also provides for the fact that, under a mortgage constant of 9.87%, amortization will be 17.74%. Provisions for amortization and appreciation (17.74% paid off) are calculated by multiplying the respective percentages by a sinking fund factor (.049252) at the equity yield rate. The overall rate calculations are concluded as follows: Basic Capitalization Rate .11409 Less Credit for Equity Build-up .7000 x .1774 x .049252 = (.00812) Less appreciation: .10 x .048252 Overall Capitalization Rate 10304 Rounded to 10.30% ~ Strateg~s G3 Based on our analysis, capitalization rates of 10.38% and 10.30% were indicated for the subject property. We selected 10.30% es being reasonable and supportable for the subject. A ~9 ~J ~I r W ~~ ~ Stratus i, N d 64 STABILIZED INCOME & EXPENSE ESTIMATE Potential Gross Income 385,881 SF ®$2,15/SF/YEAR $788,818 Allowance for Vacancy (6°k) (539.3411 Effective Gross Income $747,475 Expenses Management & Leasing (7% of EGI) $52,323 Structural Reserve ($0.25/SF) 91.490 Total Expenses ($143.8131 NET INCOME BEFORE DEBT SERVICE $803,882 Capitalized (c~ 10.3% $5,880,798 Rounded To $5,900,000 To this amount, the value of the excess land ($1,600,000) must be added for a total value of $7,500,000. VALUE INDICATION V/A THE INCOME APPROACH INCLUD/NQ EXCESS AROUND 57,500,000 Strateg~s ~l ~l ~l I~1 ICI t~s Sales Comparison Approach $7,100,000 Income Approach $7,500,000 In correlating the approaches to value, we have considered the basis for each approach, the evallabllity of supporting documentation, and the assumptions and adJuatmenls made in forming each value Judgment. The Sales Comparison Approach produces an estimate of value by comparing the subject property with sales and/or listings of similar properties located In the same or competitive areas. This appraisal technique indicates the value established by Informed buyers and sellers In the marketplace. it is my opinion that this approach Is the most significant measure of market value far industrial property, and I have placed principal emphasis on this approach. The Income Approach measures the present worth of anticipated future benefits, as evidenced by the net Income derived from the property. This approach develops the subject property's estimated gross Income, followed by deductions for vacancy, expenses and any other applicable charges. The resulting net Income is then capitalized to produce an ind(catlon of value that reflects the requirements of lenders and Investors in the marketplace. This approach Is supportive of the Sales Comparison Approach but, since the subject is, In fact, owner occupied, the Income Approach for the subject is highly speculative. After all considerations, it is our opinion that the estimated market value of the subject property, as of September 1, 1994, is: -SEVEN MILLION ONE HUNDRED THOUSAND DOLLARS - - ~$~,1oo,aooJ Strateg~s f9 ~J 0 ~l l~J L~J J ~' u ADDENDA Strateg~s n-i ZONING TABLE OF USE REGULATIONS SCHEDULE K INDUSTRIAL DISTRICT (IN) A. that willrconstituteaalharmoniouscand approprlatetaddittaneto~the physicaltians development of Upper A71en Township. Permitted uses are restricted to those which are compatible with adfacent uses and which have appropriate open spaces, land- scaping and parking areas. Such uses must be carried on in a manner so that they do not unfavorably intrude on other uses in the township. These uses may include industrial uses, such as manufacturing and assembly, warehousing and storage; both light and heavy industrial uses. 8. In the Industrial District, manufacturing uses are permitted, provided that no radiosdisturbance fumes. vaporiorigasesugo beyondtthelproperty iines~creatingcsuchr potential nuisances. ' P ~ Permitted ~y Number Use SE ~ Special Exception !! 1, Adult entertainment facility SE Z, Auto gasoline service station P 3, Auto body repair garage P 4, Auto sales P 5, Auto washing facility P 6, Bank/financial institution P 7, Business services P g, Communication facility P (publicly regulated) 9, Communication facility SE (non-publicly regulated) 10. Contractor's office & storage P 11. Conversion apartment SE 12. Crop farming P 13. Cultural facility P ~~ 'I !1 I ~~ u ^ UPPER ALLEN CODE A•2 P ~ Permitted Use Number Use SE ~. Special Exception 14. Drive-in stand P 15. Extractive operations SE 16, Fire station p 17. Greenhouse P 18. Hospital P 19. Junkyard SE 20. Manufacturing P 21. Mill P 22. Mortuary/funeral home P 23. Motel/hotel P 24. Parking lot P 25. Personal service establishment P 26. Public building P 27. Public entertainment facility P 28. Public recreational facility P 29. Repair services P 30. Research. testing or experimental lab P 31. Restaurant P 32. Sanitary facility SE 33. Shops and stores P 34. Signs p 35. Supply utilities SE 36. Trade/professional school P 37. Transportation terminals P 38. Trucking terminals P 39. Narehousing and storage P, C J ~' ~I LJ Cad C ra e N" u hat ~ m ~ c~ z. ~ p ~- vi o v y GN N F V QE O a G E Y u L .p W I ~ .~ V . N ~ ~ ^ .. ~ . . ~ N Vl v ~ N u tV ^ O V 1 7 v C I ~ h O ~ h ~ H h L `- ~ N N a E E C c L I O h O ~ ~I C1 O N O c~1 O Yf O P1 O ~/1 O V1 O rl u E m G ~ e u~ I N c+1 vv1~ N vv1~ fV V1 rf u H h ~ vl 1'1 V1 P1 N t~1 N H1 V7 HI G p . . G7 . E m ~ ~ E~ ~ ~q I ° O C~ ° 'r~ „ °n c~ e„'n ° Q ~ O W L ~ ~~V E~ C'o ~ I g N h N $ ~ N h $ $ G ~ E ~ ,` ma c .c c s ~c 4 ~ ~ ~ ~ ~ Q V1 v1 S c O g o $ o h ~ o V'1 ~ o ~ O ~ o ~ 0 ~••i N ~ ^ v cO`i v v v U < ~ vi a a O Z V V ~ ~ i E O u a u Q u a ~ ~ _ ~ ' E .~- ~ ~ 0 E u o Q c O u C _ '.Z ~ u ~ v ~ ~ ~ a u U ~ 3 a 4 d ~ ~ (y ~ PC Q c u ( u . ~ ~ O W F 'C C p ~ (5. ~ ~ qC u p c9 6 a' v'~ a a O U ac. C C A-3 ...-. ~, O N a~ y~ v ~ v p ~ a. ; «. ~: L w ~ ,,., o c ^ O a ~ ~ L ~ E F 6 '^ ~ x o A Y- e E m +~ .+ ~' ~ a ~ N E ~ ~ o a+ d C C"O ~ r 6 L q a ~ ~ E ~ ai .+ . „ .p - v+ ~ L c U C E 'K U N °a$ ca+ m C ~• W Y L C U C V L al ° o E . c ^= .a ir V p N ^ " d v~ {J c > > n ~' wwm. T p r 1 L L. ~.. W T N u3u ~+ ~++ 'c L '^ w y , a i c'^o C t L 6 ~' ' ~' v °' o v c . C d +~ Q O '~ 10 U 7 p ~ L O P C ~.. O C ~+ L d O. L ~ ^ v p L a G C a c~ u O C d O 4 .. T a ~~ .// V p Y OILY u 'r' r- u ~ is o a k tj q a O W L o u ~ e L s ` ~' a + ai ~+ a ,,, rn a+ o „ L Q ' t ~ u-~ ~ °uwa ~ °d 7 'O A QI r~ N ~ r+ C 7 r O N~ r O ~ ~g ~ as `u T ~ 7 ~ N m ~ ~.~ a K ~ ~ o B ~ o p 1(f r- ~ ~ ~ X ~ N _ C u .o c r T~ y E V ut L . d L e F~~ ~ O N z ~J ~n>` w a3,_ U WW IGY: N Y` 1L r O ~ r ,?. 2 K ~ ~ ui o w cn ~~. . ~ Z W ~ p .°n p n ~ ~ ~ c m c ~J to a ry~^ry ~ N V) N W W o `~ m ion m vii o o ¢ ui uri vi u~i ~? W µ1 ~a N ~ ~ a ~ a ~ o O o .- .- .- m ,v° ~ ~ ~ ' ~ V a a S a ro ~~ 3 ~~ '1' ~~ V j ~ °~ C E C a ~ > a ~ 1 ~c v'o J o . E U`~ y La ~(~ m ~O v ~ J°1 ~~ ~~ v ~3 ~ ~v ~ ~~ a as a na ~ ac Ya N ~ ampp d pp Q v~ ~ ~~F.v o yq ~v ~ v Fv m ~v ' ~N~ ~ ~ om~`az N m o ~ o aL `~ ~ D W E ~~ ~ , • ~« ~ ~ o~pp~~ ~ ' 'oo~ U p~ Q' ~U po~7 p JJJU . J 2 U J JJ J s ~ Z ~- N M V i' ~,4_: n-a ~lll W SHOUP SR MAI CAE GMI W r A-5 PRESENT POSITION: Senior Vice President, Professional Services Mr. Shoup has extensive appraisal experience In a wide range of valuation problems. His experience Includes responsibility for projects related to valuation assignments of major corporate properties including office buildings, manufacturing plants, research and development facilities, shopping centers, and industrial parka. In addition to corporate properties, Mr. Shoup has also appraised colleges and universities, hospitals, nursing homes and retirement communities. He has completed these assignments on behalf of corporations, colleges, hospitals, law firms and lending organizations for sale/purchase, financing, ad valorem taxation, and condemnation. In addition to his responsibility for the development and implementation of the Company's professional service standards, Mr. Shoup also manages the Philadelphia Division of the Company. PROFESSIONAL EXPERIENCE: Mr. Shoup began his career in real estate In 1983. His previous positions Include that of staff appraiser with Marshall and Stevens, Philadelphia and Shannon and Luchs, Washington, D.C. He was also the chief appraiser and principal owner of Realty Appraisals Company, which he joined in 1969, prior to its merger Into Strategis. EDUCATION: Mr. Shoup is a graduate of Georgetown University with a Bachelor of Arts degree. He has completed various appraisal, mortgage banking and property management courses sponsored through the American Institute of Real Estate Appraisers, the Society of Real Estate Appraisers, and the Mortgage Bankers Association of America. ~ Srrateg~s A-G AUDIT/LITIGATION EXPERIENCE: Mr. Shoup has appeared as an expert witness before boards of assessment in California, Georgia, Michigan, New Jersey, New York and Pennsylvania. He has been recognized as an expert witness by the Federal District Court, Appellate Tax Court of Massachusetts, Michigan State Tax Tribunal, various Common Pleas Courts of Pennsylvania, and the Tax Court of New Jersey. PROFESSIONAL AFFILIATIONS AND LICENSES: Mr. Shoup is an MAI designated member of the Appraisal Institute, a CAE designated member of the International Association of Assessing Officers, a CMI designated member of the Institute of Property Taxation, and a licensed real estate broker in the Commonwealth of Pennsylvania. Mr. Shoup Is a certified general appraiser in the States of Connecticut #0000582 Delaware #X10000189 Florida #RZ0001775 Maryland #10406 Michigan #12-01-003945 New Jersey #RG01851 New York #48000006117 Pennsylvania #GA-000191-L OTHER PROFESSIONAL ACTIVITIES: Mr. Shoup has conducted seminars on various real estate appraisal topics before such audiences as the Chicago, Illinois and Niagara, New York Chapters of the Tax Executives Institute, the Institute of Property Taxation, International Association of Corporate Real Estate Executives (NACORE), the Associated Industries of Massachusetts, and the South Jersey Chapter of National Association of Accountants. He served as President of the Philadelphia Chapter Number 2 of the Society of Real Estate Appraisers. ~trate~s M i~ 1 Appraisal of Book of the Month Club 1225 South Market Street Upper Allen Township Cumberland County Mechanicsburg, PA 17055 ~i "Ae of Date" January 23, 1995 For Mechanicsburg Area School District 500 South Broad Street Mechanicsburg, PA 17013 By 6TEVEN N. BARRETT, 6RPA, BRA, ABA, CPE PA Certified General Appraiser GA-298-L Certified PA Evaluator AV-34-L Licensed PA Real Estate Broker RB-26921-L And NILLIAM A. BASSETT M Pa Certified Residential Real Estate Appraiser RL-1347-L Licensed PA Real Estate Associate Broker AB-49762-L 6. N. BARRETT REAL ESTATE AND APPRAISAL SERVICES A PENNSYLVANIA SOLE PROPRIETORSHIP Copyright 1995 ^ ^ '! TAHLB OF CONTENTH 'I Letter of Transmittal. • . 3 "1 , • Summary of Important Data. , , , , 4 4 Scope of Appraisal-Marketing Time. 6 Property Description 7 Location Analysis. ,13 Regional Data • ,lg • i Ne ghborhood Data . . , 20 ~~ Site Data .21 zoning and Restrictions. .22 ~~ Recording Data .22 Assessment Analysis. .23 Highest and Best Use .24 Purpose of Appraisal .29 Appraisal Process. .31 Direct Sales Comparison Approach .35 Income Approach. .56 Coat Approach. .58 Correlation and Final Value. .73 Certification. .75 Certification and Statement of Limiting Conditions .76 Resumes. .82 Photographs. .87 Addenda .99 J } ~! i S. W. IIARRF.TT Rb:AL ESTATE & APPRAISAL SERVICES i AI'P~•luh • Ilmlaye • l'uunullnf 124.126 N. Huno~cr Slrect Carlislr, 1'A 1701J-2433 1'hnne 1117) IJ)~hG16 fA% 1717/ N)~NA77 Slnxn W. Oarrclt, SRI'A, SRA, ASA ('rrlUlnl AppNlsrrs .Slulr C'Pr!(/Ittf Gnirrul .IppNnr, Wllllum A. Iluutll Ulune Cilll W~l 1~I1 ~! ® Cut~enJra C'rocktl! Sean A. Slowranek e ~ ~ ! ~~ ~i1W~ AftnflYlr A/r(~NI3PIf t^.~ u„ • D Q G`"5 ,(•. C7. IlerrY Slulur Unnne K. Shute: )ealtelle )ettklnr March 16, 1995 Mr. Richard C. Snelbaker, Esq. Solicitor for Mechanicsburg Area School District 44 West Main Street Mechanicsburg, PA 17055 RE: Appraisal of 1225 6outh Market 6treet upper Allen Township Cumberlnnd County Mechanicsburg, PA 17055 Dear Mr. Snelbaker: In compliance with your request, I have personally inspected the above captioned property to estimate its present market value. The value shown has been arrived at after careful study of the location and type of improvements, their present physical condition and their present use. Therefore, I believe it to reflect a true measure of the present-day market value ae of January 23, 1995: Value Reported: NINE MILLION DOLLAR6 ($9,000,000) i hereby certify that I have no financial interest, present or contemplated, in this property, and that neither the employment to make the appraisal nor the compensation therefrom ie contingent upon the value reported. Sincerely, -~7 r~~~ ~ STEVEN W. BARRETT, SRPA, SRA, ASA William A. Bassett CERTIFIED GENERAL APPRAISER ASSOCIATE REAL ESTATE APPRAISER M 3 i ., ~ 6UMMARY OF IMPORTANT DATA Purpose of Appraisal: To determine fair market value of real w estate, only I Subject: 1225 South Market Street Upper Allen Township Cumberland County Mechanicsburg, PA 17055 E~ Owner of Record: Book of the Month Club, Inc. I Zoning: IN - Industrial District k~ I~ Recording Information: Deed Book 27W, Page 260 ! Tax Parcel Information: District 42, Map 10-646, Parcel 6 ~ ~ Highest and Best Use: Current usage or usage allowed by zoning. !~ ~ Property Description: Industrial warehouse complex with an attached two story office area. The complex contains 261,010 gross square ~:~ feet of warehouse and 96,916 square feet of office area. Second Floor office space contains 14,400 square (j) [~ feet. Building Size: Total 357,926 Square Feet First Floor 343,526 Square Feet Second Floor 14,440 Square Feet Land Size: Total acreage is 66.26 with improve- ments located on a primary tract containing 30 acres. Land to Building Ratio: The ratio for the total acreage is 8.06 to 1. The ratio for the primary tract ie 3.65 to 1. The building area utilized in the ratio was first floor uare footage s . q Appraisal Dates: Certification Date: March 16, 1995 Inspection Date: January 23, 1995 "As of Date": January 23, 1995 4 !9 f1 Data of Last Transfer: The property last transferred June 22, 1978, for a consideration of $1.00. Environmental Audit: No environmental audit report was provided to this appraiser. This appraisal i.e subject to the environmental disclaimer located in the addenda of this report. 5 ^ 1 w I 1 1 6, ay 1 ~~ ~i .a .I ;q i! ~7 e BCOPL OF THS APPRAI6AL Extent of the process in which data are collected, confirmed and reported. The appraisal was completed in accordance with USPAP guidelines and conforms to all current appraisal standards. All information was verified through public record or personal contractor phone interviews with grantors, grantees, brokers or other individuals involved within the Bales and/or leasing transactions. Marketing Period 1. The time it takes an interest in real property to sell on the market subsequent to the date of an appraisal. 2. Reasonable marketing time ie an estimate of the amount of time it might take to sell an interest in real property at its estimated market value during the period immediately after the effective date of the appraisal; the anticipated time required to expose the property to a pool of prospective purchasers and to allow appropriate time for negotiation, the exercise of due diligence, and the consummation of a sale at a price supportable by concurrent 6 r q I t ri market conditions. Marketing time differs from exposure time, which is always presumed to precede the effective date of the appraisal. (Advisory Opinion O-7 of the Appraisal Standards Board of The Appraisal Foundation and 6tntement on Appraisal 6tandards No. 6, "Reasonable Exposure Time in Market Value Estimates" addressee the determination of reasonable exposure and marketing time.) Market value estimates imply that an adequate marketing effort and reasonable time for exposure occurred prior to the effective date of the appraisal. In the case of disposition value, the time frame allowed for marketing the property rights is somewhat limited, but the marketing effort is orderly and adequate. With liquidation value, the time frame for marketing the property rights ie so severely limited that an adequate marketing program cannot be implemented (The Report of the Apprnisal Institute Speaiel Task Force on Value Definitions qualifies marketing time in terms of the three above mentioned values). After researching various sources of commercial Bales from local multi-list and brokers who specialize in commercial Bales, it was determined that the marketing time for commercial properties in Cumberland County range from 180 to 360 days. 7 i .t ., ., M I W I ~y ~~ t,'~ i {~ DE6CRIPTION OF IMPROVEMENT6 The subject property consists of an industrial/warehouse complex containing 357,926 gross equere feet. The complex includes 261,010 gross square feet of warehouse space and 96,916 square feet of finished office apace. Approximately 2,000 square feet of the office is unfinished area in which the HVAC ie located. The complex originally was built in 1968. Various phases of construction, from 1960 through 1908, included three warehouses: one 70,800 square feet, the second 49,126 square feet and the third 125,470 square feet. A connector was built between the two main warehouses containing 16,020 square feet. This connector also ie utilized as warehouse space. The original office apace contains approximately 49,046 square feet with an additional 47,870 equere feet built during this time period. For an industrial/warehouse complex, the office area appears to exceed the normal ratio of office space to warehouse apace. The subject contains 96,916 square feet of office apace. This equates to an office to warehouse ratio of 278. The office area includes the executive suite and all supporting departments of the existing company. All the department areas are generic style office apace that could be utilized by any user. The executive office suite includes five separate 8 q i w I offices. Four of these offices have separate conference rooms. North of the executive office suite are the computer roam, the HVAC room, key entry room, technical support office, security ~ office, mail processing area, incoming mail room and the cash ~ receipts office. on the second level is an adjoining office ~ area. This includes the employment center, customer service, a ~'~ smell training room and a restroom/lounge. Tha remaining office areas are located east of the executive suite. These include f~ '~ the main reception area, the employee cafeteria, large meeting ~~ room, finance and statistical offices, the training offices, programming analyst, the print shop, purchasing office, the ~'~ engineering and maintenance department and circular mailing area. Throughout the first floor ere various men's and women's ~~ employee restroome. Lam' ~l ~~ ~l 9 p 1 ~~ 1 W r~ ,~ Fi i±,I The interior improvements are as follows: Floors: Carpet, the and concrete Walla: Partitioned walla, panel, drywall, painted concrete block and brick Ceilings: Drop ceilings composed of fiberglass tiles. Doors: Wood and metal Lighting: Fluorescent HVAC: Central air conditioning with resistant or electric heat pumps also providing heat. Plumbing: Standard fixtures and plumbing which are adequate for the current usage. Sprinkler System: Wet pipe system throughout the office area Security System: ADT system connected to exterior openings. The warehouse area originally was built in 1968-69 and subsequent additions in 1975 and 1988-89, respectively. There are three warehouse areas with a connector between warehouse Noe. 1, 2 and 3. No. 1 was the original warehouse/storage area adjacent to the north office. A separate part of this area ie utilized ae a return/sorting room, and a space containing five separate offices. This area has three ten feet overhang doors. Warehouse No. 2 was built in 1975. It is east of Warehouse No. 1 and is integrated with the existing warehouse. Warehouse No. 2 is only utilized for storage with no separate rooms or l0 !1 II LJ offices. Located in the northeast corner of Warehouse No. 1 ie the connector warehouse. This area connects to Warehouse No. 3 which was completed in 1988-99. Warehouse Nos. 1 and 2 and the connector are utilized as storage, only. The connector warehouse adjoins Warehouse No. 3 on the south side. Warehouse No. 3 has multiple uses, as an open area for storage end free- standing equipment for packaging and shipping. The interior improvements of the warehouse are ae follows: Floors: Concrete floors, four to six inches in depth Walls: Concrete block and metal Ceilings: Metal Ceiling Heights: 22 Feet in Warehouse Nos. 1 and 2. 16 Feet in Warehouse No. 3. HVAC: Gae blowers with central air conditioning in Warehouse No. 3 Loading Docks: 27 Ten feet high docks with one ramp door Lighting: Gas vapor lighting throughout warehouse area. 11 i ' Other improvements for office and warehouse: °~ Electric: 4000 Amp multi-phase system. Utilities: Public water, sewer, electric and telephone. bi ~ There also ie an on-site pump to public ~ lines located along South Market Street. i ~''~ Overall, the improvements are in good condition. Although tha offices and warehousos have been built in various phases since Q~ ,; 1968, the improvements ae constructed are functional. f-~jj i ~; 12 ~ r..r .w .nr ^w ~ ~ ~.. ~ .... .....~ ...~-_ _._.. ____ __ I I W LOCATION ANALYSIS Regional Dale The subject property lies within the Harrisburg SMSA area. Harrisburg ie the capital of Pennsylvania and also is the county seat of Dauphin County. The standard metropolitan Harrisburg area encompasses three counties, namely Dauphin County on the east shore of the Susquehanna River and Cumberland and Perry Counties which are on the west shore. Harrisburg is ideally located, being 100 miles from Philadelphia which is accessible by the Pennsylvania Turnpike and Schuylkill expressway, 200 miles from Pittsburgh which also ie accessible by the Pennsylvania Turnpike and Baltimore which ie accessible by I-83. Philadelphia lies to the east of Harrisburg, Pittsburgh to the west and Baltimore to the south. Baltimore is approximately 75 miles from Harrisburg. In addition, Washington, D. C. lies approximately 135 miles south of Harrisburg. 13 r I w The Harrisburg metropolitan area has a total population of 496,066 which includes Cumberland, Dauphin and Perry Counties. I According to 1990 statistics there were 181,946 households. ~; e~ The subject property ie located in Cumberland County. The population increased from 178,541 in 1980 to 197,213 in 1990 ~-~ within Cumberland County. The majority of growth has occurred within the suburbs, which ie a common condition throughout the ~~~ ;~ entire country. ! There are various military installations situated in the region t and these include the U. S. Naval Supply Depot in Mechanicsburg, !.1 the U. S. Army New Cumberland Depot located near New Cumberland, `~ the U. S. Army War College located in Carlisle. All three ~' installations are located in Cumberland County. in addition, C~ Fort Indiantown Gap Military Reservation also lies within proximity of the metropolitan area and it is the headquarters of ~~ the U. S. Army Pennsylvania National Guard. This facility ie utilized for summer training. It is evident from the above that the largest employer in the Harrisburg SMSA is government, which provides employment for approximately 258 of the work force. in addition, employment is provided by manufacturing facilities, services and trade. u 14 '~ Employment has been rather stable with unemployment levels below ~ state and national levels. The most recent statistic relative to the unemployment rate within Cumberland County ie 3.88. i ~ The 1990 census information for Cumberland County indicates ~ buying income per household ie $35,540 with the median age of ~~ 37.3. Approximately 658 had incomes in excess of $25,000 and approximately 44.88 in excess of $35,000. f~ 1990 Population 197,213 t ~ Households 73,467 t.~ With the expansion of the Harrisburg Airport to an International ~~ Airport, it is anticipated that new industries will be attracted into the area. At the present time, the airport ie served by ~!~ TWA, American, United, Northwest, U. S. Air and Esetern besides `+ several local commuter lines. Within the last five years a new, modern terminal has been constructed. Due to the fact that the City of Harrisburg and the tri-county area is centrally located, it is a hub of transportation for swift and efficient distribution in all directions. Interetates I-81, i-83 and I-76 (Pennsylvania Turnpike) all serve the Harrisburg area, particularly at the juncture of I-83 and the Pennsylvania Turnpike in the Carlisle area. Within the past y! 15 I A ~ three years, Roadway Express has completed construction of a new ~ distribution terminal and ABF is anticipating construction of a new and larger terminal, both of which are located in the ~q Carlisle area. r~ Harrisburg is on the main lines of Conrail and Amtrak. Freight rl service is provided by Conrail to the north, southwest and west { and Amtrak provides passenger service. The Enola Yards 1a (Cumberland County) are located northwest of the city of ~~ Harrisburg and when rail service was at its peak this was one of I ~ the largest rail yards in the world. I~ I In addition to the above mentioned interstate routes, Harrisburg f~ ie serviced by U. S. Routes 11, 15, 22, 322 and 422. Local service routes provide access to the wholesale distribution and major terminals. Local transportation ie provided by the Capital Area Transit j~ System and the Greyhound Lines. Capital Trailways provides FF~~ inter-urban transportation. J There ie a wide diversity of industry located in the Harrisburg Metropolitan Area. Some of the national concerns located in tha area are Bethlehem Steel, Caterpillar Tractor, Quaker Oats, Amp Incorporated, American Can, RCA and Hershey Foods. Products manufactured by these concerns include steel, tractors, shoes, 16 '1 11 ~J ~i floor the and acoustical ceilings, cereal preparations, solderless electric terminals and tools, food canning, electrical appliances, chocolate candy, office equipment and tractor-trailer bodies. There ie a wide variety of cultural facilities within the Harrisburg Metropolitan Area. These include the ten million dollar State Museum, The Forum which ie the home of the Harrisburg Symphony, as well as accommodating visiting artists, and the State Library. Entertainment also is provided in Hershey which ie located within a few miles of the city of Harrisburg. It has Hershey Park, a famous amusement park. Various performers from all facets of entertainment can be seen at the Hershey Arena, a multipurpose facility, the Hershey Theatre and Founders Hall. The Cumberland County area lies directly west, across the Susquehanna River from Harrisburg and has been a rapidly growing area ae it is centrally located in the heart of the great eastern market. This area ie convenient to all the amenities previously outlined for the Harrisburg metropolitan area es it is part of that area. Cumberland County is located in the south central region of Pennsylvania in the Susquehanna Valley and west of the Susquehanna River which forme its eastern boundary line. J 17 a i Adjoining counties include York and Adams to the south, Franklin to the west, Dauphin to the east and Perry to the norttt. k'1 '~ Cumberland County ie comprised of 550 square miles and ranks ~ 40th by size among Pennsylvania's 67 counties. Twelve boroughs and 22 townships make up Cumberland County. Carlisle, which ie the county seat, is its largest town and it lies approximately 18 miles from Harrisburg, the state capital. E# I~ k,~ Ae stated previously, Cumberland County has had an increase in ~~ population, total number of households and average household !~ incomes. The largest increase was average household incomes. The average income increased from $21,716 in 1980 to $35,540 in i~ 1990. This was an increase of 648 which shows strong economic development. Economic demographic, social and physical factors effecting the marketability and value trend of real estate in the subject locale include: A strong transportation center due to the location of the interstates and its advantageous location to the eastern markets. New construction of office buildings, truck terminals, warehouses, industrial facilities, etc. 18 Expanding population bees, including available skilled and unskilled workers. In summary, the rising population and income of the general area ~ indicates strong economic growth. This also assures the i continued need for goods and services and the transportation system which ie available to provide these goods and services. li ~J J 19 '! A i k~ {~ ~~ ICI N!~ Neighborhood Dnta The direct neighborhood ie located in the north central section of Upper Allen Township, Cumberland County. The subject ie located approximately .5 mile south of the Borough of Mechanicsburg. The main access to the property and neighborhood ie South Market Street, Legislative Route 11A. South Market Street is a two lane macadam road that extends north and south. It provides access to the Borough of Mechanicsburg and to Route 15. Route 15 ie a major thoroughfare that extends north and south through the central part of Pennsylvania. Located on Route 15, approximately two miles east, is the Gettysburg Interchange of the Pennsylvania Turnpike. The turnpike extends east and west from one end to the other through the state of Pennsylvania. Route 15 and the Pennsylvania Turnpike provide access to Interstates 81 and 93. These interstates provide easy access to major metropolitan areas of the northeast section of the United States. The neighborhood within a two mile radius has been developed to blend well with the various uses. As previously stated, the area ie conveniently located to the Pennsylvania Turnpike. The turnpike borders the subject site to the south. South Market Street intersects the turnpike where the subject site is located. All the properties that bordor the turnpike are industrial with some commercial users. The industrial users are 20 I ~~ I~ f primarily warehouses. Located north of the site are residential properties. There are various office buildings located south along South Market Street, overall, the area has established e good reputation with close proximity to all surrounding communities. Site Dntn The subject property is located at the northeast quadrant of South Market Street and the Pennsylvania Turnpike. Access to the site is from South Market Street north to the Pennsylvania Turnpike. The site consists of 66.26 acres. The topography overall is level. The site has paving approximately six acres in size and ie utilized for parking, driveways and parking pads for docking. The site is serviced by the following utilities: electricity, water, sewer, gee and telephone. The tract is identified as Parcel No. 42-10-646-006 by the Cumberland County Assessment Office. The tract is located in a non-flood area ae indicated by Upper Allen Flood Map No. 420372-0005, Effective Date February 15, 1900, Zone C. 21 .v 'I III Egnina Restrictions The subject site is zoned IN - Industrial District. Tho ~ property conforms to the existing zoning ordinance. (Please sea ~~ Highest end Beat Use for further explanation.) Any additional ~ usage and improvements are subject to existing zoning, restric- ~~ tione, rights of way or easements that may be recorded in the jj ' Recorder of Deeds Office of Cumberland County. 1 ~~ Recording Data ~~ The subject is recorded in the office of the Recorder of Deeds I in and for the County of Cumberland in Deed Book 222, Page 439 I~ and Deed Hook 23E, Page 86. The Tax Identification No. is District 42, Map 10-646, Parcel 6. f~ Ifll ICI 22 i ~ ~ ~.I ^..r ~ r ~ uw Illwl ~ s ...a .__ . ~.~_. ._.. _ ~ ^ i.,'.7 ~J,~IILUI lJ'U: D.i R11Lll 11LAL LJ I.iIL ILL• 1 .`IJ f. JUl TA= AxD A88C88Ti~TIT ATIALY6I8 The following is the nsse9sment and tax liability for the subject Property, ae determined by the Cumberland County Assessor's office: ~-rsscemaat Land. . 5134, 500 Improvements. 726.000 Totel. $662,500 Toll Rat~^ Municipality. .0040 County. . 0245 School . .1260 Total. .1543 Tax Lisbilitp Municipality. .$ 3,450 County. 21,131 School. 106, 675 Total. S133,256 Cumberland County Board ~f Assessment Appeals established 1974 ns the base year !or determining market value on any property that was built prior to that date. The Assessment office considers market value as 256 of its total assessment amount. 23 . TAY AND A66E6SMENT ANALY6I8 The following ie the assessment and tax liability for the subject Property, ae determined by the Cumberland County Assessor's Office: Assessment J~and. . $134, 500 Improvements. 728,000 Total. $862, 500 Nill Rates Municipality. .0040 County. . 0245 School . .1260 Tots 1. . 1545 Tax Liability Municipality. .$ 3,450 County. 21, 131 School. 108, 675 Total. $133,256 Cumberland County Board of Assessment Appeals established 1974 ae tha base year for determining market value on any property that was built prior to that date. The Assessment Office considers market value as 259 of its total assessment amount. The subject property will be assessed after the completion of the project. Therefore, our estimate of taxes will be based on comparable medical office buildings. 23 i ® t~s Qr'FINITION OF NIOflB$T ANO HBST USB The reneonably probable and legal use of vacantl and on an improved property, which ie physicnlly possible, appropriately supported, financially feasible and that results in the highest value. The four cr.tteria the highest and best use must meet are legal permis- sibility, physical possibility, financial feasibility sad mnximum profitability. sheet and neeG Use o£ Land or g,SitQ as Thougd Vaaant Among all reneonable, nlternative uses, the use that yields the highest present land value, after payments are made for labor, capital and coordination. The use of n property based on the assumption that the parcel of land is vacant or can ba made vacant by demolishing any improvements. R~ahaat and D eat Use of Prope rty as Improved The use that should be made of a property as it exists. An existing property should be renovated or retained as ie so long as 1t rnntinuos to contribute to Ll;d LuLal marker value oY the property, or until the return from a new improvement would more than offset the cost of demolishing the existing building and constructing a new one. T'a~ ~m ~ -7irrinnmv nP Ran! F.dafe ~nD/~tp~ TtIFt~ ~'dition, 1993, ~1ppmLtaf Institute, Chicage, IQrnois. 24 pEFINITION OF HIGHEST AND BEST USE The reasonable and probable use that will support the present value es defined, ae of the effective date of this appraisal. Alternative that use from among reasonably probable and legal alternative uses, found to ~~ be physically feasible and which results in the highest land value. The definition immediately above applied specifically to the highest and I~ best use of the land. It ie to be recognized that in cease where a site has existing improvements on it, the highest end best use may very well ~~ be determined to be different from the existing use. The existing use will continue; however, unless and until land value in its highest and ~~ best use exceeds the total value of the property in existing use. I~ The highest and best use of land or a site ae though vacant ie ae i follows. Implied within these definitions is recognition of the contribution of that specific use to community environment or to community development goals in addition to wealth maximization of individual property owners. Also implied in the determination of the highest and best use which results from the appraiser's judgement and analytical skill; i.e., that the use determined from analysis represents an opinion, net a fact to be found. in appraisal practice, the concept of highest and best use represents the premise upon which value ie based. In the context of moat probable selling price (market value) another appropriate term to reflect highest and best use would be most probable use. In the context of investment value an alternative term would be the moat profitable use. Taken from REAL ESTATE APPRAISAL, TERMINOLOGY, Ballinger Publishing Company, Cambridge, Massachusetts, Third Printing 1982. 24 S~oheat and Beet yee The subject property ie located in the north central section of IIpper Allen Township, Cumberland County, PA. The Bite ie located at the northeast quadrant of South Market Street and the Pennaylvanin Turnpike. South Market Street provides access to the subject vita with approximately feet of road frontage. The highest and beet use ie that most reasonable use that supports the highest preseat value as of the effective data of the eppraieal. The highest and best u6e of the land (site) if vacant and available for uea may be different from the highest and best use of a property with improvements. The higheet and beat use analysis requires the employment of various categorise of use oriented discussions to conclude that a given use io the higheet and best use of the land. The uses must meet lour criteria: 1. Legally Permissible 2. Physically Permissible 3. Financially Feasible 4. Most Profitable 25 1 t~ F~ it ~~ l ~I LJ ~l Highest and Hest use The subject property is located in the north central section of Upper Allen Township, Cumberland County, PA. The site ie located at the northeast quadrant of South Market Street and the Pennsylvania Turnpike. South Market Street provides access to the subject site with approximately feet of road frontage. The highest and best use is that moat reasonable use that supports the highest present value as of the effective date of the appraisal. 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 a property with improvements. The highest and best use analysis requires the employment of various categories of use oriented discussions to conclude that a given use is the highest and best use of the land. Ttte uses moat meet four criteria: 1. Legally Permissible 2. Physically permissible 3. Financially Feasible 4. Most Profitable 25 ,~ ~1 ~ ~aelly Permioei~l4 W 1 The subject property conforms to the current zoning ordinance. ~ There ere no known private reotrictions, building code I ~~ limitations or onvirorrmontel controls which would restrict that ~ use. The alto currently is improved with a one-story warehouse Ii with a two-story office addition and ie utilized as a storage/distribution facility. This usage is allowed to ,i continue under the current zoning ordinance. ~~ ~~ phvelaelly Feasible i i Under the present zoning ordinance, the permitted uses include ~~ manufacturing, transportation terminals, trucking terminals and warehousing/storage facilities. Please see addenda for ~~ additional uses. The site was developed into a warehouse/ distribution facility which is permitted to continue. The site has been expended twice since 1968. The Bite has sufficient size end acceptable topographical features providing a suitable location for the current use. The availability of public utilities enhances the property. The Bite is not impacted by poor visibility or access. r~ The physical layout of streets and public utility connections ^ provide utility to the site. The Bite ie physically adaptable to continually support a warehouse/storage facility. 26 i i ei I r~ I H I i,y I it i~ i~ #: Financially Feasible: Of the uses which are legally permissible and physically possible, the use which ie capable of generating a positive cash flow is considered financially feasible. The subject property ie located in an industrial zoned area approximately two miles from the Gettysburg interchange of the Pennsylvania Turnpike. it ie located within one mile west of Rosemoyne Industrial Park consisting primarily of warehouse/storage facilities. The frontage of South Market Street provides easy access and high visibility. The neighborhood is primarily industrial, commercial office and residential. Therefore, any usage other than those allowed by current zoning would not be financially feasible. The improvements and land currently are utilized as a warehouse/ distribution facility. Therefore, it generates the highest return. Most Profitable Of the uses which are considered financially feasible, the use must provide the highest rate of return over the longest period of time in order to be considered the highest and bast use of the property. The subject is located in an industrial zoned area with the properties east of the subject utilized ae industrial. We feel the only use capable of generating a positive net income is the present use , as it exists. In the J 27 ~ highest and beat use anal sis the y , profitability test assumes ~ competent management. j Implied within these definitions ie the recognition of the rA contribution of that specific use to the community development ~ goals, in addition to wealth maximization of the adjacent ~'~ property owners and development trend associated with the i genoral area. The surrounding neighborhood consists of various s;~ ,~ industrial warehouses, retail and offices. This area ie well ~~ established. The trend appears to continue. i1 ~~ It should be noted that the determination of the highest and beet use for the subject property ie a result of the appraiser's E~ judgement and analytical skill and represents an opinion, not Pact, and in the appraisal practice the concept of highest and ~~ best use represents the premises upon which value is based. The legal possibilities that place controls on the potential use are zoning, deed restrictions and set back regulations. The highest end beet use, as if vacant, would be the same as improved. It can be said that the new use of the subject property ae a warehouse/storage facility ie a legal, conforming use that is consistent with land use pattern. Weighing all the aforementioned, I have concluded that the highest and best use of the subject property ie use as a warehouse/storage facility. 2D ~ O ~ r 111 r ~ Aw o ~..^ s... .~.~.. --- I a PURPOSE OP APPRAISAL M1 The purpose of the appraisal ie to estimate the market value of -+~ ~ the subject property in fee simple title. ') property Rights Aparaised I~ iJ This is an appraisal of the market value of the unencumbered fee ~~ simple title to the subject property; subject only to easements, f dead restrictions and zoning requirements described for the 4 M subject property. Such title includes both the physical real ~~ estate, i.e., the physical land, the appurtenance including structure affixed thereto and the interests, benefits, and ~~ rights inherent in the ownership of the physical real estate. Personal property is not included in this valuation. Definition of Market Value The moat probable price which a property should bring in a competitive and open market, under all conditions requisite to fair sale, the buyer and the seller, each acting prudently knowledgeable and assuming the price ie not affected by undue stimulus. Implicit in this definition ie the consummation of e v 29 i sale as of a specified date and the pa ssing of title from seller to buyer under conditions whereby: (1) buyer and seller ere typically motivated; (2) both parties are well informed or well N i advised and each acting in what he considers his own best ~,y interest; (3) a reasonable time ie al lowed for exposure in the '~ open market; (4) payment ie made in terms of cash in U. S. ~`~ ;! dollars or in terms of financial arrangements comparable thereto; and (5) the price represents the normal consideration i~ ;j for the property sold unaffected by special or creative ~~ ~! financing or Bales. ~~ ~~ J ~I 0 30 ~J ~ APPRAI6AL PROCE68 w I The purpose of en appraisal ie to estimate fair market value. W ~~ The first step ie to define the problem; the work necessary to ~~ solve the problem is planned; and the date required ie acqu.ired, `+ classified, analyzed and interpreted into en estimate of value. -i Within this process, three basic approaches are used by the i appraiser. They ere: Direct Sales Comparison Approach, Income 1~ ~ Approach end Coet Approach. r_i CI ~~ _.J J ~~ Direct 6eles Comparison Approach is based primarily upon the principle of substitution. This principle holds that an informed purchaser would not pay more than the coat to purchase a comparable property with similar utility. The major limitation to this approach is when there ie an inactive market and no valid comparable sales are available. This approach also ie questionable when sales data cannot be verified with principles to the transaction. The appraiser selects sales of comparable properties for which the pertinent data is considered reliable. Adjustments are developed for characteristics differences between comparable. Then the sales are adjusted to the subject. The appraiser then correlates the adjusted comparable Bales data into an estimate of market value by the Direct Sales Comparison Approach. 31 i N t~ t~ F~ ii t~ ~~ Income Appronch ie based upon the principles of substitution, contribution and anticipation. The principle of substitution states that an informed buyer would pay no more for a property than he would for a competitive type property with a similar income stream. The principle of contribution holds that the value of the property ie measured by the contribution of the component parts to the total economic unit, land and improvements. The principle of anticipation states that value ie the present worth of future benefits from property ownership. Capitalization is the process of converting net income into an indication of value. A direct sales overall capitalization rate is developed from market data and ie based on the relationship of net operating income to the sales price. The appraiser estimates gross income by analyzing the market for comparable rentals. Deductions for vacancy and collection losses, operating and fixed expenses also are developed from market data. The final results of these analyses is an estimate of net operating income. Net income is then capitalized into an indication of market value by the Income Approach. 32 1 Cost Aaaroach ie based on the principle of substitution. The ~~ principle of substitution holds that an informed purchaser would not pay more for a property than the coat to obtain a site and build a comparable property with similar utility, without undue ~~ delay. One of the major limitations to this approach is '~ developing an accurate estimate of accrued depreciation from all t~I sources. ~~ The first step in the Coet :.pproach is to estimate the market ~1 value of the site, as though vacant and put to its highest and I~ beet use. Site value is abstracted from market comparable land t~ sales. Then an estimate of reproduction coat new ie developed f for the improvements. ~~ Diminished utility of accrued depreciation from physical, functional, or external causes is then deducted from reproduction cost new. The estimate of market value by the Cost Approach ie the summation of the depreciat ed value of the j~ !~ improvements plus the market value of the site put to its highest and beet use. 33 n ~9 ~ Conclusion of Appraisal Process The last step in the Appraisal Process ie the reconciliation of ~ the three approaches into a single estimate of value. Reconciliation ie a process which considers the dependability W 'I and applicability of the three approaches and reconciles the ~~ three value indications into a final estimate of defined value. F~ i ~. 34 E ~ ~ 0~ ~ ~ 0~ 01111 100 ~ •~•~• n•• ""'~ n ~+ ~ DIRECT SALE6 COMPARI60N APPROACH Introduction to Direct bales Comparison Approach pl In arriving at this conclusion of the value of the subject property, your appraiser made a survey of properties t hat have ~~ sold within the general area. As it was impossible to find an identical property tc that of the subject, since no two buildings are ever identical, it was necessary to make adjustments on each comparable sale as related to the subject {~ i~ d i i i d d ven an a justments were property. Cons derat on was g e on ma each comparable sale as to the time of the sale, size, location and utility, as well as other factors that may effect value. The following direct pages are the improved comparable Bales that have been found appropriate for this appraisal. Following the comparable sales are the analysis and conclusion. 35 II i '1 6nle No. 1 '1 ~l Grantor: Grayson Road Associates Grantee: First Independent Finance Partnership, LP P~ Address: 7125 Grayson Road Swatara Township Dauphin County Improvements: one story warehouse complex containing 300,000 square feet, built in 1991. The warehouse consists of 294,580 square feet with 5,420 square feet of office space. The office area is 1.81$ of total area. Exterior of building is metal and decorative concrete walla. The warehouse floor ie concrete. The heat ie provided by an air return system. The office area has a the floor. The heating and cooling ie provided by a central forced air system. The exterior has 34 overhang doors with one door 12' x 12', 20 doors 10' x 10' and five doors 10' x 12'. The interior height of the warehouse ie 28 feet. Site improvements include macadam parking lot, site lighting and security fencing. Year Built 1991 Recording Information: Deed Book 2253, Page 335 Tax ID: District 63, Map 018, Parcel 117 Land Size: 17.49 Acres Building Sizes Warehouse: 294,580 Square Feet Office: 5,420 Square Feet Total: 300,000 Square Feet 36 "1 t i F~ I~ I LJ Sale No. 2 Grantor: Grayson Road Associates Grantee: First Independent Finance Partnership, LP Address: 7253 Grayson Road Swatara Township Dauphin County Improvements: One story warehouse complex containing 200,000 square feet, built in 1990. The building ie divided into two separate warehouse areas. one area contains 96,000 square feet. The other aide contains 104,000 square feet. There ie a total of 3,323 square feet of office apace, 1.78 of total area. Exterior of the building ie metal and concrete block. The interior floor ie concrete. The exterior has 17 overhang doors with 15 doors 9' x 10', one door 10' x 12' and one door 12' x 14' site improvements include macadam parking lot and security fencing. Also located on the site ie a 17' x 29' brick pumping station. The ceiling height is 24 feet. Year Built: 1990 Recording Information: Deed Book 2253, Page 335 Tax ID: District 63, Map 18, Parcel 103 Land Size: 12.4211 Acres Building sizes Warehouse: 196,677 Square Feet Office: 3,323 Square Feet Total: 200,000 Square Feet Office Space Percentage: 1.78 i 3B Carnation Company Grnntor: Fry Communications, Inc. Grantee: Address: 15 Pleasant View Drive Silver Springs Township and Borough of Mechanicsburg Cumberland County One story manufacturing and warehouse are feet Improvements: , building containing 271,630 squ built in 1969. Tha wnrehouse area feet with 17,714 contains 253,916 square The office square feet of office Space. is 6.56 of total nrea. The exterior area einforced concrete h r i as a r floor or inter ith 18 overhang doors. The floor w tailing height is 24 feet. Office nrea ith mixed the and 6.5i is good quality w anel or plaster board, drop t , p carpe ceilings, package heating and cooling. ipe sprinkler et p Tha main plnnt has a w throughout, modine heat off a t em sys centrnl boiler and two inside rail lle tracks. The fn c=litoffers excellent o manufacturing with overall se potential h ou ware rTVehicles ~f i o n4 1 t adequate macadam park The improvements sad and loading access. located within two separate site are municipalities. Year Built: 1969 Recording Infornation: Deed Hook 35X, Page 87 District 19, Map 8-562, Parcel O1 Tax ID: District 38, Map 8-567, Parcel 32 Land Size: 17.90 Acres 40 1 ~v ri Bale No. 3 Grantor: Carnation Company i !3 Grantoe: ons, inc. Fry Communicat ~ Address: 15 Pleasant View Drive ~ ~ Silver Springs Township and Borough of Mechanicsburg Cumberland County Improvements: One story manufacturing and warehouse building containing 332,700 square feet, built in 1969. The warehouse area contains 330,700 square feet with 2,000 square feet of office apace. The office area ie 0.78 of total area. The exterior ie concrete block and metal. The interior floor has a reinforced concrete floor with 18 overhang doors. The ceiling height is 24 feet. Office area .78 is good quality with mixed the and carpet, panel or plaster board, drop ceilings, package heating and cooling. The main plant has a wet pipe sprinkler system throughout, modine heat off a central boiler and two inside rail tracks. The facility is flexible for manufacturing or offers excellent warehouse potential with overall condition of fair to good. There is adequate macadam parking lot for vehicles and loading access. The improvements and site are located within two separate municipalities. M Year Built: 1969 Recording Information: Deed Book 35X, Page 87 Tax ID: District 19, Map 8-562, Parcel O1 District 30, Map 8-567, Parcel 32 Land Size: 17.90 Acres 40 Building Sizee Warehouse: Office: Total 253,916 Squnra Faet ~7.71d Square Feet 271,630 Square Feet Office Space Percentage: 6.59 Land to Building Ratio: 2.87 To 1 Sala Price: $4,800,000 Sale Date: September 25, 1992 Price Per Square Foot: $16.57 i 1 1 i I D'y ICI L~_I IFl nn~ W 8ele No. 4 Grantor: Unit Properties, Inc. Grantee: System Realty Three, Inc. Address: 201 Cumberland Parkway Upper Allen Township Cumberland County Improvements: one-story distribution warehouse containing 339,648 square feet, built in 1992. The warehouse area contains 332,518 square feet with 7,130 square feet of office apace. The office area is 2.18 of total area. The exterior ie tilt-up panel and steel frame. The interior floor has a reinforced concrete floor with 34 overhang doors and one drive-in door. The ceiling height is 30 feet. The heat to the warehouse is provided by modine heat. It also has a wet pipe sprinkler system. The overall condition of the facility is good. On site improvements include an adequate macadam parking lot for vehicles and loading access, ae well ae concrete surfaced truck access area to loading docks. Year Built: 1992 Recording Information: Deed Book 35V, Page 868 Tax ID: District 42, Map 26-243, Parcel 34 Land Size: 22.34 Acres Building Sizes Warehouse: 332,518 Square Feet office: 7,130 Square Feet Total: 339,640 Square Feet 42 u 'I Fa ~i M Sale No. 5 Grantor: Eaeco Hand Tools, Inc. Grantee: Lancaster Press, Inc. Address: 3575 Hempland Road West Hempfield Township Lancaster County Improvements: One story general light manufacturing and industrial building containing 172,249 square feet, built in 1965-66. The warehouse contains 151,249 square feet with 21,000 square feet of office apace. The office area is 12.28 of total area. Exterior ie painted concrete block and brick. The floor is five-inch reinforced concrete, rubber roof system, 30' x 50' column spacing, 508 wet pipe sprinkler system and 18 feet ceiling heights. The heating ie a combination gas unit and roof mounted forced warm air. There are four overhang doors and one drive-in door. Site improvements include a macadam parking lot and site lighting. Year Built: 1965-66 Recording Information: Deed Book 3389, Page 4 Tax ID: District 30, Map 12616-2, Parcel 2 Land Size: 14.8 Acres Building Sizes Warehouse: 151,249 Square Feet Office: 21,000 Square Feet Total: 172,249 Square Feet Office Space Percentage: 12.28 44 n A I A W ~) f^ ri Sale No. 6 Grantors United States Steel Corporation Grantee: True Railroad Associates, LP Address: 465 Railroad Avenue Hampden Township Cumberland County Improvements: one story heavy manufacturing and warehouse complex containing 391,690 square feet, built in 1954 The manufacturing and warehouse contains approximately 360,355 square feet with 31,355 square feet of office apace. The office area is 88 of total area. The exterior is mostly steel aiding; however, the front offices are masonry with brick veneer. There are 40 over hang doors and numerous drive-in doors. The clearance height averages about 26 feet with some lower clearance areas. Heating ie provided by a central boiler with modine unit heaters, ae well as spot gee-fired modine unite. The entire structure is wet pipe sprinklers. The office area is mostly the with limited carpet, plaster board or paneled walls, plaster or drop ceilings, mostly with central air conditioning. The structure includes crane capacity up to 20 tons. The overall condition of the facility is average to fair, consistent with age. On-site improvements include macadam parking and yard areas with adequate access to loading areas. Year Built: 1954 Recording Information: Deed Book 35M, Page 452 Tax ID: District 10, Map 22-527, Parcel 155 Land Size: 43.69 Acres 46 u A i Bnle No. 7 Grantor: Dauphin Distribution Services Co. Grantee: Hampden I and II Address: 6350 Brackbill Boulevard Hampden Township Cumberland County Improvements: One story warehouse building containing 259,200 square feet, built in 1983 with an addition built in 1988. The warehouse area contains 255,330 square feet with 3,870 square feet of office s ace The p . office area ie 1.58 of total area. The exterior ie metal with a metal roof. The 1~ interior warehouse has a reinforced ~J concrete floor with 23 overhang doors. The ceiling height ie 26 feet. There also ie an alarm system and a wet- sprinkler system. The office area has carpet floor covering and partitioned, painted walls made of drywall. The office area is heated by forced hot air and it has central air conditioning. The overall condition of the improvements is good. On-site improvements include a macadam parking lot with an attached four feet by 640 feet, 2,560 square feet, canopy with a concrete pad. There are 23 overhang doors. Year Built: 1983 R di ecor ng Information: Deed Book 35Z, Page 634 Tax ID: District 10, Map 21-285, Parcel 1 Land Size: 13.08 Building Sizes Warehouse: 255,330 Square Feet Office: 3,870 Square Feet Total: 259,200 Square Feet 48 r M I I !1 ~! ICI ~I Sale No. 8 Grantor: Cumberland County Industrial Redevelopment Authority Grantee: Dauphin Distribution Services Co. Address: Dauphin Drive Silver Spring Township Cumberland County Improvements: One story warehouse building containing 146,665 square feet, built in 1951. The waret:ouse area contains 144,265 equate feet with 2,400 square feet of office apace. The office area ie 1.68 of total area. The exterior is metal with a metal roof. The interior warehouse has a reinforced concrete floor with 29 overhang doors and 4 ramps. The ceiling height is 26 feet. There ie an alarm system and a wet sprinkler system. The office has carpet floor covering and partitioned, painted walls made of drywall. The heat for the warehouse is a gas rotating system. The office area ie heated by forced hot air and it has central air conditioning. The overall condition of the improvements is good. On-site improvements include a macadam parking lot. Year Built: 1981 Recording information: Daed Book 35B, Page 123 Tax ID: District 38, Map 19-1621, Parcel 86A Land Size: 9.33 Acres Building Sizes Warehouse: 144,265 Square Feet Office: 2,400 Square Feet Total: 146,665 Square Feet 50 Sete Dete Sele Pdu Bu0die5 Siu (Sq• pr.) Uned)tuaed Price/Sq. FL - to Subkrs l,ocedon ~8 OIEce Spas 54e (2796) queGry/lo0didon Duet OwrtteS Daors Cailie{ H41Sht Peraaup Ad)u7tmenr AdJuete6 Pdn/Sq. FI. ,. n~ovr-r c~~_o_e OOM'/Lat~N (~~ g~IP ACFT 7 4 1 07-0691 OT-069t 09.35.97 OB-2691 02-71-71 014493 31.18.93 01.17-91 f9,340,000 55,960,000 5/.500000 58,760000 fl.'300,000 36300000 56966,150 f3.2'1.000 yp0,00p 196000 171,670 ]]9,645 171,7A9 391,690 319,200 146,665 S 31.1] S ]0.41 5 1637 S 15.79 S 1838 f 1660 S 26.68 S 21.% SIMRAA SC11nAlt, SLMLAR SBAl1Aft SIMMR SIMIWI SQ~Aft SlhfllAR SQ~BIAft SNDIAR SLNBAR SI711I1i1R SLtiBIAR SI]IILwR SIMILAR SIMBAR L~F 309L INP 2096 HAP 2096 [NF 2076 I1\Y 1074 IAF 20% INF 2016 ¢.'F 20Re SUP (1095) SUP (2015) LYF 2076 SUP (20%) SQ.~AR SLMH.AR SLP (2016) SUP (1096) SINAAA LYP 1016 CYF 1096 SIIuIIIAA 1`rF 30% SUP (109a) SIMILAR SL~AR SUP (1070) SUP (1095) SLP (10%) SLY (104c) SI.NILAA SLP (1070) Sl'P (107c) SUP 009'0) (10%) 0 4095 (10'4) 70 46 0 (1095) (10'4) 525.01 530A1 52.120 52311 s21.15 s1a60 521.19 319.76 52 I' II I! M PIRIR't' SAIP3 (XIM PA RISON M ARKIfI' tiAU{ NIJ MIII(R Salt Dale 07-0(.'14 U74Nt~H p1.23 !12 UN-2(.92 02-21 !12 OI-24-92 11.1X•'12 M•17-91 Sele Pzitt 3'1,140,000 SS,WA,Ollll SI,Sf10,IXM) fA,7fA,0W SJ,200,OW f6,S00,000 S6,Wr6,150 33,321,000 ©uliding Size (Sq, FI.) 700,000 196,0011 JJ2,7W JJ9,fr1X 172,247 391,6W1 259,2011 146,665 Unadjualed Price/Sq. Ft. S 71.13 S 30.41 f 17.57 f 25.79 S Itl.Stl f 16.60 f 26.A8 S 21.96 t SuYnbWt b S I.ocallon SIMILAR SIMILAR SIMILAR SIAfIIAR SIMIIAIi SIMILAR SIMILAR SIMILAR Zoning SIMILAR SIMILAR SIMIIAit SIMIIAIt SINIIAR SIMILAR SIMILAR SIMILAR Olnce Space Size (27%) INP 20% INP 207. INI' 20 n. INI' 20!>o INP 10% INP 20% INP 20% INP 20% Oualhy/CondUion SUP (]A%) SUP (209fi) INP 20% SUI' (2U'-0) SIMILAR SIMILAR SUP (20%) SUP (20%) Dock Overhang Door SIMILAR INP 10°/n INP 10'm SIMILAR INN 20% SUP (l0'i0) 91MIlAR SIMILAR Celling Ilelghl SUP (10%) SUP (IU9'v) SUI' (10%) SIMILAR SIMILAR SUI' (10°h~) SUP (l0%) SUP (10%) Penentage Adjustment (10'70 0 40':0 (10'7) 3U % 0 (IO%) (I(1%) AdJuped Pritt/Sq. FI. (2X.02 S3UAI 31X!14 S2J.21 S24.IS SI6.60 Sb1.19 519.76 52 'i !9 Adiustmant Analysis !f Office Space 61ze The office apace for the subject property is 278 of total square footage. Most warehouse/light manufacturing ranges from .78 to 128, as indicated by the comparables. Therefore, an inferior adjustment of 208 was made for all comparables except Comparable No. 5. A 108 adjustment was made due to its higher percentage of office space. ~I ~l LJ Qunlity/Condition Comparable Nos. 1, 2, 4, 7 and 8 are superior to the subject property as they have been built within the past 12 years. Comparable No. 3 is inferior as to quality of construction. Comparable Nos. 5 and 6 are similar as to age and quality of construction. Dock Overhang Doors Comparable Nos. 2, 3 and 5 are inferior as to number of doors. Comparable No. 6 ie superior as to number of doors. Comparable Nos. 1, 4, 7 and 8 are similar overall to number of doors. Ceiling Height All comparables except No. 5 are superior as to ceiling heights. In a warehouse operation ceiling heights are important; therefore, we made a superior adjustment. 53 nireQt Sales coanarisoa Annroa~ Sale Prico 1lnalyei• Low Value Range S3,200,000.00 Mean 5,957,500.00 Standard Deviation 2,294,566.00 Unafl~ueted Prise Per 8quara Foot Value Range $ 16.57 Mean 23.49 Standard Deviation 5.91 Adiuatgd Price Per 6qunrq Foot Value Range $ 16.60 Mean 23.69 Standard Deviation 4.32 H~ah $9,340,000.00 $ 31.13 g 30.41 After a careful study of the value indicators and analyzing tho market data, it ie my opinion that moat weight be applied to tho adjusted price per square foot indicator. Most weight is nppliod to Comparable Noe. 1, 3, 4, 6 and 7 as they are similar in s1ze, with Comparable Nos. 3 and 6 similar ae to aqe. Further analysis of these comparablea indicatos an adjusted price par square Eoot range of $16.60 to S30.41. Tha mesa is $23.69 with a standard deviation of $4.32. 54 A I q !1 pirect Sales Comparison Aoaroech bale Price Analysis Low Value Range $3,200,000.00 Mean 5,957,500.00 Standard Deviation 2,294,566.00 Unadjusted Price Par 6quera Foot Value Range $ 13.53 Mean 23.11 Standard Deviation 6.49 Adjusted Price Per 6quere Foot Value Range $ 16.60 Mean 23.16 Standard Deviation 4.64 }-iah $9,340,000.00 $ 31.13 $ 30.41 After a careful study of the value indicators and analyzing the market data, it is my opinion that most weight be applied to the adjusted price per square foot indicator. Most weight is applied to Comparable Nos. 1, 3, 4, 6 and 7 ae they are similar in size, with Comparable Nos. 3 and 6 similar as to age. Further analysis of these comparables indicates an adjusted price per square foot range of $16.60 to $28.02. The mean ie $22.19 with a standard deviation of $4.50. 54 ,.-?9' 9jI11EDl 1d~6? BARRETT RE,aL ESTATE TELL?I' ?d3 86?' P. 006 _ . After taking into consideration all factors, moat emphasis ie placed on Compnrablen No. 4 and 6. Comparable No. 4 is located one-quarter mile seat of the subject property. Comparable No. 6 ie located approximately two miles northeast. For this enalyais, we feel the price per square foot should be S23.00 per equnre foot. In conclusion, 357,926 square feet times 523.00 per square foot equals $8,232,295. Bap 58,200,000. ~oac~ueion of Market Aaalveis The subject nits contains approximately 66 acres. We have estimated the primary nits to be 30 acres. The concluded market value includes the primary site. The exceos 36 acres are valued separately. (Please sea land analysis in Coet Approach.) Therefore, our market value is ae follows: Market Value Primary Site Excess Acreage Total Value Naket Approaoh BAY $8,200,000 S~ 788,655 58,988,658 58,989,000 55 After taking. into consideration all factors, moat emphasis is placed on Comparebles No. 4 and 6. Comparable No. 4 ie located one-quarter mile east of the subject property. Comparable No. 6 is located approximately two miles northeast. I'or this analysis, we feel the price per square foot should be $23.00 per square foot. In conclusion, 357,926 square feet times $23.00 per square foot equals $8,232,295. bey $8,200,000. Conclusion of Mnrkat Annlvsis The subject site contains approximately 66 acres. We have estimated the primary Bite to be 30 acres. The concluded market value includes L•he primary site. The excess 36 acres are valued M separately. (Please see land analysis in Cost Approach.) Therefore, our market value is as follows: N Market Value Primary Site $8,200,000 Excess Acreage S 783,000 1 Total Value Maket Approach $8,983,000 55 N { INCOME APPROACH Introduction to Income Approach The value of commercial property ie strongly inf luenced by the amount, quality and derivation of the income, in terms of rent, ~y ~] which it can generate for its owner. The Income Approach uses the potential gross rent which the property is capable of generating in today's market, lase expenses and collection for vacancy and losses, to develop an indication of the property's net income. The income is then counted into an indication of the subject property's value by means of capitalization rate considered typical for the market, the type of property being appraised and the area in which the property ie located. Capitalization w The capitalization process "translates" net operating income into a present value indication for the property. It assumes a present worth of expected future benefits. There are numerous ways to derive a capitalization rate. Since moat real estate investors require a mortgage when purchasing real estate, the Band of Investment Technique is typically used. This method is developed by using mortgage rates provided by the lender. Another method is actually taken from the marketplace. This method ie considered "Direct Capitalization." ileing actual 56 sales prices and dividing them into the net operating income of the actual eels to derive a rate from the marketplace. There must be adequate market data available to utilize this method. Typically, "Market Data" ie available to extract a market ` derived capitalization rate. Our findings indicated a rate ^i ranging from B8 to 128 for commercial, industrial and other investment oriented properties. The Debt Coverage Formula Technique also was considered ae supporting our market estimation of the overall capitalization rate. This methodology also takes into consideration the loan to value ratio, a mortgage constraint and debt coverage factor. Yield Capitalization ie applicable in the analysis of properties with irregular income streams. In this approach an income stream ie projected over a specified holding period, and then calculating the present worth of the income stream, plus the present worth of the reversionary interest at the end of the holding period. Industrial and warehouse/distribution properties similar in size and utility are not typically purchased for their income characteristics. These types of properties are moat likely to be owner-occupied. Therefore, the Income Approach was found inappropriate for this analysis. 57 ~~ C06T APPROACH xntroduotion to Cost Approach !1 In the Coet Approach to value, the value of the land and the improvements are estimated separately and then added together to develop a value indication for the entire property by means of the Coet Approach. Land is usually valued ae if vacant and available for development to its highest and best use. For this process, the Direct Market Comparison Approach is generally the most reasonable method of valuation considered applicable. This method involves comparing similar land sales recently Bold or offered for sale with the subject property, as vacant; and a comparative analysis is made of factors affecting value. A sale seldom possesses all the various characteristics of the subject property to the same degree, some judgment must be used in arriving at a final estimate of value of the land. The value of the improvements is estimated by the reproduction cost of the structure and other site improvements, then depreciated for phyei.cal deterioration, functional obsolescence (curable or incurable); or external obsolescence if applicable for the subject property. 58 i " Lnnd Sales The following direct pages are the site comparables that have been found appropriate for this approach followed by the analysis and conclusion. i~ 59 1 h `1 t1 M Sale No. 1 Grantor: Grantee: Address: Sale Price: Sale Date: Recording Information: Tax ID: Zoning: Land Size: Price Per Acre: Ritner Park Associates Allen Distribution 1701 Shearer Drive Carlisle Borough Annex Cumberland County Carlisle, PA $610,000 June 2, 1993 Deed Book 36H, Page 1048 District 50, Map 8-0581, Parcel 5 I1 - Goneral Industrial 10.97 Acres $55,606 60 it [I '1 Bele No. Z Grantor: Grantee: Address: Sale Price: Sale Date: Recording Information: Tax ID: Zoning: Land Size: Price Per Acre: Lancaster Development Company Pennsylvania Dental Services Corp 5091 Louise Drive Upper Allen Township Cumberland County Mechanicsburg, PA $981,339 November 25, 1992 Deed Book 35Z, Page 1145 District 42, Map 10-256, Parcel 9 IP - Industrial Park 24.79 Acres $39,586 61 `i M Sala No, 3 Grantor: Grantee: Address: J N Sale Price: Sale Date: Re di I f ti cor ng n orma on: Tax ID: Zoning: Land Size: Price Per Acre: Ritner Park Associates Allen Distribution 1705 Shearer Drive Carlisle Borough Annex Cumberland County Carlisle, PA $765,000 November 6, 1991 Deed Book 35J, Page 571 District 50, Map 8-581, Parcel 5A I1 - General Industrial 14.64 Acres $52,254 62 M r Beale No. 4 Grantor: Cumberland Business Park Associates Grantee: Unit Properties, inc. Address: 201 Cumberland Parkway Upper Allen Township Cumberland County Mechanicsburg, PA Sale Price: $1,407,420 Sale Date: October 9, 1991 Recording Information: Deed Book 35V, Page 868 Tax ID: District 42, Map 26-243, Parcel 34 Zoning: IN - Industrial Land Size: 22.34 Acres Price Per Acre: $63,000 63 II Nele No. 5 r~ r Grantor: Grantee: Address: Sale Price: Sale Date: Recording Information: Tax ID: Zoning: Land Size: Price Per Acre: Ritner Park Associates Rose Stores, Inc. 1707 Shearer Drive Carlisle Borough Annex Cumberland County Carlisle, PA $1,681,680 October 5, 1990 Deed Book 34U, Page 996 District 50, Map 8-581, Parcel 6 I1 - General Industrial 35 Acres $48,048 64 I J ;I A (:OM PARAill.li LAND SAI.IS ANAI.VSIS 9AIJi NUMRI41t Sale Dale 06.02•'17 09.23-92 11.06•')1 10.07.91 09.03.90 Sale Prlca f 610,000 f 9tl 1,7]9 S 763,000 31,407,420 31,681,690 Land Slze (Acrcz) 1097 24.79 14.64 22.74 73.00 UnaJJualeJ 1'rlce Acre S 33,606 S 79,396 S 32,254 S 67,000 S 48,048 ComzNnbllit• to Subkcl L«alian SUP (10'X,) SIA111.A11 SUI' (10'70) SIMII.AIi SUP (1046] Attea/Site SIMILAR INP 10^,6 SIAt11.AR SIMILAR SIMILAR NelghborhmJ SIMILAR SIM1111.AR SIA111.AIt SIMII.AIi SIMILAR Percentage AJJugmenl (1070) 1046 (104i) 0 (1070) AJJupeJ Price 1'er Acre S SU,043 S 47,545 f 47,029 S 67,000 S 47,247 65 ~1 M ~1~ustment Annlveis Location Comparable Nos. 1, 3 and 5 are located in an industrial park approximately one-half mile from a major interstate intersection. Therefore, a superior adjustment was made. Aaaess/61te Comparable No. 2 is located within one mile of the subject Bite. However, access to the site is difficult and the Bite was not conducive to industrial development. Therefore, an inferior adjustment was made. 66 ~I Lend 6eles Analysis Low Sale Price Range $ 610,000 Mean 1,089,088 Standard Deviation 446,841 Unadjusted Price Per Acre Price Per Acre $ 39,506 Mean 51,699 Standard Deviation 8,709 Adjusted Price Par Acre Price Per Acre $ 43,243 Mean 49,372 Standard Deviation 8,112 Hfgh $1,681,680 $ 63,000 $ 63,000 After analyzing industrial sales within Cumberland County, the only comparables located in the past five years were salsa ranging in size from 10.97 to 35 acres. The subject site contains 66 acres. The adjusted price per acre ranges from $43,243 to $63,000. In analyzing land sales, the price per acre usually decreases as acreage increases. Industrial land does not appear to follow this trend ae indicated by all the comparables. This ie further illustrated by Comparable Nos. 2 and 4. Both are similar in size, they are zoned industrial and located within two miles of the subject site. 67 i! All comparable land Bales were found to be bonafide arm' s length transactions. After studying the three approaches, the adjusted price per acre seems more appropriate for this analyeie. Moat weight is applied to Comparable No. 2, as it is located within two miles of the subject site. Comparable No. 4 also ie located within one mile. However, it appears the price per acre is above the average range. After taking into consideration the location, size, utility, mean and standard deviation, we estimate the price per acre to be $43,500. The existing tract contains 66.26 acres. Therefore, the existing tract contains excess acreage. We reviewed the land to building ratios of the comparable sales to determine the amount of excess acreage. They range from 2.20 to 4.86 which indicates the land needed for the site. After reviewing these figures, we determined 30 acres is substantial for the primary site. This would give us a land to building ratio of 3.65 to 1. The ratio falls within the range of the comparables. Therefore, this gives us 36 excess acres. In determining land value, the value for the primary site ie higher than the excess acreage. We feel, for this analyeie, a fair market value for the excess acreage ie 508 of the primary site price per acre. Ae previously stated, the primary site price per acre is $43,500, with the oxcess acreage price per acre being $21,750. 68 M 1 N Final Lend {Lelue Conclusion After analyzing all factors, we feel the land value ie ae follows: Primary Site: 30 Acres @ $43,500 $1,305,000 Excess Acreage: 36.26 Acres @ $21,750 S 788,655 Total Lend Value $2,093,655 69 CObt~ Ch The coat estimation figures are from Mnrehall and Swift Cost Services based on the average Claso C type for storage/ warehouses. This coat figure also takes into considoration the good office apace included with the subject property. Tho following coat figure has been calculated: r~.Aa C 1-v~=age Nar.house /Diatribgtio n Ceiling Height 22 feet 16 Feet Square Foot Coet $21.32 $21.32 Plua Wat Sprinkler System + 1.0~ .=L 00 S22.32 S22.32 Height Multiplier x l,lel 1 Adjusted Square Foot Cost $26.36 $23.2 Currant Cost Multiplier ~? 0 Adjusted Square Foot Cost $26.89 $23.71 Local Multiplier x 1.00 x l,oo Unit Price Per Square Foot $26.89 $23.71 70 i ~" `1 Coat Aaproeoh M ~1 The coat estimation figures are from Marshall and Swift Cost S i b erv ces ased on the average Clas s C type for storage/ warehouoes. This coat figure also takes into consideration the good office apace included with the subject property. The following coat figure has been calcula ted: Class C Average Warehouse /Distribution S u F t C q are oo oet $21.32 Plus Wet Sprinkler System x 1.00 $21.32 22' Height Multiplier x 1.181 Adjusted Square Foot Cost $25.18 Current Cost Multiplier x 1.02 Adjusted Square Foot Cost $25.68 Local Multiplier x 1.00 Unit Price Per Square Foot $25.68 70 Depreciation The depreciation was determined by using the effective age/life expectancy from Marshall and Swift publications for commercial properties. The subject property has been built in various stages over the peat 27 years. The original office and warehouse were built in 1968. Various additions were completed in 1974, 1980 and 1988. ~~ M N r J Therefore, our effective age and life expectancy are a blended calculation. After inspecting the property, we determined the physical effective age of the property is 20 years, with a life expectancy of 45 years. After reviewing the Marshall and Swift publication depreciation tables, we estimate a depreciation range of 20 to 25 per cent. Therefore, we determine the blended depreciation of all improvements ae 238. 71 1 noon os Tsa ltO1tTH cLUD Mechanicoburg, PA I1~a*e~~huFinn/}jasyhOUN AY~a T2" C~iliaq 8~ight &qunre Footage IInit Price x Square Foot = Replacement Coet 232,456 x $26.89 ~ $ 6,250,742 16' C~iliaq Hight 125,470 x $23.71 D~precintioa Phyoical 238 Functional 08 External 08 Depreciated Value of Improvements S 2.974.894 $ 9,225,636 (52,12L8961 $ 7,103,740 Depreciated Value Site Improvements Primary Site Land Value Excess Acreage Land Value Total Value Coat Appronoh $ 200,000 $ 1,305,000 S 788,655 $ 9,397,395 Say G 9,400,000 72 t 1 BOOK OF Mechanicsburg, PA Distribution/1lnrehousa Area Square Footage Unit Price x Square Foot Replacement Coet 357,926 x $25,68 $ 9,191,540 Depreciation Physical 238 Functional 0$ External 08 Depreciated Value of Improvements Depreciated Value Site improvements Primary Site Land Value Excess Acreage Land Value Total Vnlue Coat Approach 72 L$2,114,0541 $ 7,077,406 $ 200,000 $ 1,305,000 S 788,655 $ 9,371,141 Sny $ 9,400,000 . ,` i ~ v ^ ~ ;,-~9' 951N'EBI IS~04 i I BARRETT RE~IL EST~ITE ^01~x~~..°TI411 AIiD f TEL~'11 '.4~ N6?" P. 004 I ~ All three approaches to valuo have been uoed to dovelop a value t indication for the subject property. These value indicators are ae follows: Market Approach $6,989,000 Income Approach Not Applicable Cost Approach $9,400,000 ~nnelu610A O~ Dirweti $a108 GOODpariSOa ADPronah An estimation of value is developed by comparing similar properties that have recently sold and are similar in size, quality, location, utility and other similar Factors. An extensive search was undertaken for comparable properties. All information was verified through appropriate sources and considered accurate. The market Bales were then adjusted and compared to the subject to arrive at a value per this approach. C i .ai - yr `w *^^^.wa AeorOAOh I Potential gross income of the subject property was analyzed and compared with other income and expense etatemonts from i comparable type properties. Vacancy and loss (based on t o study of similar gross income) were subtrneted to arrive at an i 73 CORRELATION AND BINAL VALUE All three approaches to value have been used to develop a value indication for the subject property. These value indicators are ae follows: Market Approach $8,983,000 Income Approach Not Applicable Cost Approach $9,400,000 Conclusion of Direct 6eles Comparison Approach A An estimation of value ie developed by comparing similar properties that have recently sold and are similar in size, quality, location, utility and other similar factors. An extensive search was undertaken for comparable properties. All information was verified through appropriate sources and ' considered accurate. The market sales were then adjusted and compared to the subject to arrive at a value per this approach. Conclusion of the Income Approach ;~ ' Potential gross income of the subject property was analyzed and compared with other income and expense statements from ' comparable type properties. Vacancy and lose (based on the study of similar gross income) were subtracted to arrive at an 73 effective gross income. Net operating income ie then capitalized et the overall capitalization rate to arrive at a value per this approach. Conclusion of the Cost Approach Reproduction coat new was derived from a national coat service and verified through local contractors. Depreciatior. from all sources was applied to arrive at a depreciated value of the improvements. Land/site value, which was derived from market data, was then added to the depreciated value per the Coet ' Approach. ' In conclusion, considering the purpose of this appraisal and the type of property being appraised, the Market Approach warrants moat emphasis with the Cost Approach supporting our value. The Income Approach was found inappropriate for this analysis. Therefore, it is the opinion of this appraiser that market value ' "As of" January 23, 1995, ie: NINE MILLION DOLLAR6 ($9,000,000) 74 :`~' r _ ., i ® ~ I ~ ~ CERTIFICATION I hereby certify that I personally inspected the subject property and that I have no present or contemplated future interest in the real estate that ie subject of this appraisal report; that i have no personal interest or bias with respect the subject matter of eppraieal report or the parties involved; that the amount of my fee is not contingent upon ® reporting a predetermined value or upon the amount of the value [~ estimate; that to the best of my knowledge and belief that the statements of fact contained in this eppraieal report; upon which the S analysis, opinion and conclusions expressed herein are based, are true FYI and correct; that this appraisal report sets forth all of the assumptions and limiting conditions (imposed by the terms of the assignment or by the undersigned affecting the analysis, opinions and conclusions contained in this report; that this appraisal has been made in conformity with and is subject to the requirements of the Code of Ethics and standards of Professional Practice and Conduct of the Society of Real Estate Appraisers and the Appraisal Institute; and that no other than the undersigned prepared the analysis, conclusions and opinions concerning real estate that are set forth in this eppraieal report. No change of any item in this eppraieal report shall be made by anyone other than the appraiser, and the appraiser shall have no responsibility for any such authorized changes. Certification Date: Property Inspection Date: "Ae of" Date of_.~Ap/praised Value: STEVEN W. BARRETT, SRPA, SRA, ASA CERTIFIED GENERAL APPRAISER March 16, 1995 January 23, 1995 ~~J~~~~anuary 23, 1995 WILLIAM A. BASSETT CERTIFIED RESIDENTIAL APPRAISER 75 a~ r i1 CERTIFICATION AND 6TATEHENT OF LIMITING CONDITIONS Certifioation: The appraiser agrees that: S 1. The appraiser has no present or contemplated future [^'1 interest in the property appraised; and neither the employment to make the appraisal, nor the compensation for it, is contingent upon the appraised value of the property. 2. The appraiser has no personal interest in or bias with reepect to the subject matter of the appraisal report or the participants to the sale. The "estimate of Market value" in the appraisal report ie not based in whole or in part upon the race, color or national origin of the prospective owners or occupants of the property appraised, or upon the race, color or national origin of the present owners or occupants of the properties in the vicinity of the property appraised. 3. The appraiser has personally inspected the property, both M inside and out and has made an exterior inspection of all comparable sales listed in the report. To the best of the appraiser's knowledge and belief, all statements and information in this report are true and correct, and the appraiser has not knowingly withheld any significant information. 76 it it ii ~I 4. All contingent and limiting conditions are contained herein (imposed by the terms of the assignment or by the undersigned affecting the analyses, opinions and conclueione contained in the report). 5. This appraisal report has been made in conformity with and ie subject to the requirements of the Code of Professional Ethics and Standards of Professional Conduct of the appraisal organizations with which the appraiser is affiliated. 6. All conclueione and opinions concerning the real estate that are set forth in the appraisal report were prepared by the appraiser whose signature appears on the appraisal report, unless indicated as "Review Appraiser". No changes of any item in the appraisal report shall be made by anyone other than the appraiser, and appraiser shall have no responsibility for any ouch unauthorized change. 7. This appraisal conforms to the Uniform Standards of Professional Appraisal Practice ("USPAP") adopted by the Appraisal Standards Board of The Appraisal Foundation, except that the Departure Provision of the USPAP does not apply. 77 J 8. Their compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result or the occurrence of a subsequent event. 9. This appraisal assignment was not based on a requested minimum valuation, a specific valuation or the approval of a loan. C u ~J ~~ 78 it r it W W J Contingent and Limiting Conditions: The certification of the appraiser appearing in the appraisal report is subject to the following conditions and to ouch other specific and limiting conditions ae are set forth by the appraiser in the report. 1. The appraiser assumes no responsibility for matters of a legal nature affecting the property appraised or the title thereto, nor does the appraiser render any opinion as to the title, which ie assumed to be good and marketable. The property is appraised ae though under responsible ownership. 2. Any sketch in the report may show approximate dimensions and is included to assist the reader in visualizing the property. The appraiser has made no survey of the property. 3. The appraiser is not required to give testimony or appear in court because of having made the appraisal with the reference to the property in question, unless arrangements have been previously made thereof. 4. Any distribution of the valuation in the 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 if so used. 79 ;I ~l r ~~ ~I 5. The appraiser assumes that there are no hidden or unapparent conditions of the property, subsoil or structures, which would render it more or lase valuable. The appraiser assumes no responsibility for such conditions, or for engineering which might be required to discover such factors. 6. 2nformation, estimates and opinions furnished to the appraiser, and contained in the report, were obtained from sources considered reliable and believed to be true and correct. However, no responsibility for accuracy of such items furnished the appraiser can be assumed by the appraiser. 7. Disclosure of the contents of the appraisal report is governed by the Bylaws and Regulations of the Professional Appraisal Organizations with which the appraiser is affiliated. 8. Neither all, nor any part of the content of the report, or copy thereof (including conclusions ae to the property value, the identity of the appraiser, professional designations, reference to any professional appraisal organizations or the firm with which the appraiser ie connected), shall be used for any purposes by anyone but the client specified in the report, the borrower if 80 ~i r. '~ appraisal fee paid by same, the mortgagee or its successors pl and aseiyne, mortgage insurers, consultants, professional ~j appraisal organizations and state or federally approved ~ financial institution, any department, agency or i{ instrumentality of the United States or any state or the N I) District of Columbia, without the previous written consent ~ of the appraiser; nor shall it be conveyed by anyone to the f1 public through advertising, public relations, news, salsa ~~ or other media, without the written consent and approval of the appraiser. ~i t 9. On all appraisals, subject to satisfactory completion, t~ repairs or alterations, the appraisal report and value t~ conclusion are contingent upon completion of the t improvements in a workmanlike manner. 81 w '1 N i~ NI .j 41 I~ ~1 it k1 li i~ ~{ ~~' Environmental Diseleimer: The value estimated in this report ie based on the assumption that the property is not negatively affected by the existence of hazardous substances or detrimental environmental conditions. The appraiser is not an expert in the identification of hazardous substances or detrimental environmental conditions. The appraiser's routine inspection of the inquiries about the subject property did not develop any information that indicated any apparent significant hazardous substances or detrimental environmental conditions which would affect the property negatively. It is possible that the testa and inspections made by a qualified hazardous substance and environmental expert would reveal the existence of hazardous materials and environmental conditions on or around the property that would negatively affect its value. Date Appraiser(s) J~ 7`~ Date ~' ~-\`~\~ Appraiser(s) ~`'.~-^N~v'' \~"~,U 82 ^ STEVEN W.BARRETT SLLxu W. Rarretl Ural 1'nak d Appre1W tiervircs-14tabliahed 1974 121-ID'i Nnnh I6tsoser Stmt, (1A4k, PA 17017, 717.2116614 IrAX 717-2A}8627 PR0173SSIONAI. IJCIfPk\71IL• PA Slam CenifieJ (ienerul Appruiser, OA-pMl2'18d. PA Real I'stale Ilmkr, Illl-026934A CenifieJ 1'A livnluatar, AV-IlfMl(ISI•I. PR0I71S90NAl. DISti70NA'110P7.@ SRPA, Senior Ikal Pmpny Appraiser, 11/'lU SRA, tienlor IkAdcmlul Apprelscr, 9/87 Appnlul insllmta - Oenenl Cenifiratlun Appreiul Inslitwe - Ruldentld Cenlfiretion ASA, Arrrcdited Senior Appniseq 7/90 (711, CknifieJ 1'enntylvenla 1?valuator, 11/BR Amednn Sorlety of Apprelare - Beal I'mpeny Udtan Aueuon Asurdabun of i'enntylvanla CRR Certified Real Il1a1C Iimkerege Moneger, 2/86 OAA. Oenerol Aarcdlted Appraiser, 11/91 Reallon National Marketing Insthute lieallore Apprelul Section ~, QXP[iRI1WCIL• Real Plum Pmpcny Manager, I9T1; Real Pilate Appreitcr, 1975; Rcal titate Rmker, 1971; Rcal [state Salesman, 1971 IO~IIICT WRMLS4 Cumberland end Dauphin Coumiu - Court of (:ommnn Pleas end Uumeair Mesler Ileeringi ASSOC7AT10N g[U/1U1R511IPS Appreiul IncUIWe National Aeenclelion of Review Approisen end UnJerwriten Assessor Aawciation of Pennsylvania Council of Pennsylvania Resl f§tete Appraiser American Society of Appnlscn IUnla'OR.S - Nalionel, Sietn end Local Orginira0ans Itlnla'ORS - Nuional Msrkaling InsWute OPP1~41IIffD: 1990.92 Gr141e Uosrd of Realtors Fierutive Ibant 1989.90 Vice Oavemor, SRFA, D'utrid 20 1984.86 Prcsidenq Chepmr 70, Society of Real laute Appraise rs 19827 Vice Prcsldem, Chapter 70, Soriery of Rcul [date Apprs. ®UG770N: Appnis.l Inrllule/SR11A SRFA Course 10i, An Intraluction to Apprising Real I'mpeny SRCA Couru 102, Applied ReAdemial 1'mpeny Valuation SRE\ Course 201, Principles of Income Pn>peny Valuation SRPA Course 202, Applied Inmme Pmpeny Valuation SRFA Couru 701, Special Application of Appreiwl Analysis AI Couru 510, Advance) Inmme Gpitatiration Reeldential Demonslretion Rcpon Inmme/Commercial Demunstrotlon Reptn Caotinssiog Ilduotim Semloan hotel/Motel Pmpeny/Feasibility and Appraising Commercial anJ Indunrial Repro 1'ortnc Pmfessionel Prectice Seminar Narrative Report Writing Seminar Uniform Residen11s1 Appreiul Repin tieminnr Small Resldenliel Inmme I'mpeny Appreisnl Scminur J Appreiul Guidelines to the Fcdeml llama Lvn hank i6r11 1'unctlonel Obsolescence for Itedevciopment and Income Producing Pmpenic: Rceltore National Marketing Institute Couru 702, Marketing hlunsgcmenl Uwincu Veiuetlon 1982 President, C:erlhle Ikun1 of RI?nL'1'ORS 1981 Vice Prcsidem, Carlisle Ilwnl of RInLTORS 1'179-1984 Ihecutlve IIoeN Office, Cnrlide Iloerd o! RFACI'ORS Various RI'AI:I'OR end INSITI'VIT: Cammlttees Penn Sate Utdverdty Rwl [state Apprising 1 (teal 1'state Apprelcing II Kcal 1'slate Apprising -Right of Wey lkal letetn'Iheory end Precticc Kcal f%tatn tananre (teal 191ate Administrotion and Management Real Pstete fur the Small Imesmr (:ash I'qulvelenry Seminar Veterans AJminhtratian'I'reining tieminer IIUU-I~IIA'1'roining tieminsr UnJcrwritet'e Guidelines to kcal I'mpcny Appraiwl Scminar Uniform Srendanls Comprehensive Resl I•'sretn Apprelsal Workshop Lhigutlon Valuelian 1'.tum I'rcp Seminar fur (:ammerciel Apprelcing Standanls of Pmfeuional Practice I'117 UI(AR Perm tieminar Apprulwl Innitute Appralwl of Itetall 1'mpnles 83 ~~ I~ !' 1a R ~~ l I ~~ I " l-7 iil i ili i i t lr I + I P 1 IIn11'rrn!n~;l•r, ryll'11.flll.%.~ ..~ n.~~ t~~ I I .( y 1',P,~I ~Irr.r~'r,' I IB~II 1111 Poi' kFAi r 1 flt; 1 11 1~1111111L11c,1!I,j+rt) , ! ! I 1 Ir' (•i• tl it f i I~ { I I ~Q 11 Il Alhl. 1 +{11)11 I1~II1! t ~ $fl~ U,~f~~~~ ~~~~1~°,~~~11111r'~II~ilfllll 1 I!•, • IhUehAhln l•Xf + , ~ /, lp,h r~•.• r l-.' ~1 , Y 'I' N4 +~ h III I tl I,~ '!1111'(111H1111Ij1f+'I:;!I' ;+('{~, r,, . ~'t;'IULI~~C~llll~!!-I+l(Ill+nil+ll 11 erfrll•'Irb•I Sr .•6LAna1-nAlinrli., r,'mtlnaloUulltl:,l (!,r 1', 11,p~111~1 11~1~hr,, I~r r.~ .p 11+11), Iflll'filllli~+~~l+~ Ij ~~ ~~')AIIP(IA~l~n u, 1' ~ Ir InlIll~*I ~4a,.,,..1..1./ III { b€1,. ,! Ih)~I)I•III1111!UIhJ ~ rm a t~+t lr H11 1'Fi ~ Vii. b.~b I,Ina ^~~, it+rula lis.lh•.•.la ~! 1.Ullil~}~ t.,~~ I'd`s1.+~, ~~+.~,1~11;H,~'`j'@ ~>' ~'~+II~~III(1~11~~I~~.!~ IntU 111 1. !d '• + ., 1''. ( .+ T unl ,... 71 r n rr7 I• r r i•f ~'~h n .I + 1, hi~lllr'•I,I'~ I±I~~,u l'1.!=) ' all,• ~. 11:.1 11 f1 I . nu + d. ~'•. ~~ ~?/ (r Iv i): I m~ : ,roll I t'?,' 1111 I•~ ~+~! ~ ~ .>'d• ; :a .IIL+JfI.~'li+iU)I+,~Illr,rli.1~ {. s1 , a 1nIA,~ U17 '~ {ir) ,lituh'npa Irl*plrnRrl~.ledlal~r i~;if ~!~!,!~ll~Igllilt~l~~i~.;,~,:, t,l:,:, ;:rsl; nh[; ll; II; f 1-11(~Ur~l(~b'I-~.I! II~lL!!I .II{I,~Illl,~s,'~nli ~11f'• ~~ ~~I f 11'x'.1 '+ ,, ~~. a 71 •'a h ~ u,f ~~1 ~6,.;ill r r l., ~.• jrt ~, ~IIII1 _1 dui' ~, n~~~~l.,~til 1 S 1~ ` 'ir~l`1:~h1111b1(Ai'lltnunwPll~ 1!Ibfli u 1 • 'i'1 ICI :,II r'~,,,1 "'"ril-s t_iNENs~ Is bnllll, II 1 •...._ ~' " e. ',n~' Ali ~I y, ' I ~ ` , .. I r> ` tm~~!(~+n)'r~krrf;>5fit~f~gi~ a~rl1~ n~tanltRrlra+rairl {~, 1 t ' ~ ,, ~' .'t .~ Hll/i 1+ 1{.. i-~ ~_ li 1-~ I is ~Ii; c~1~L;i9o~1~+t~IrAllivn 3i~~~r RI V~~VII {Ili l.L. •.. Ir' 1.' 1 y' R , ~iJl /p; 1, I,~ n n ,. ii I lpr'll l rl., t ~ , I~UI.,.,~Ili v II 1' ~ i{101 1 II r I'll ~ II ~ III~I 'llI jr l'LAPp Vt,l'A,Illrlr` ~ ,r + ' -•1' (Ilil ~~.r) ~y kEt ~ ` d ~ I ;ifl., r u, ~'~"ui I ;1{, VIII Afti1111.'' LII rP I.r. ~~, 111 ,•. 1111 41 iCAUllrle.~111 ~IVI~I.,/III,; y';.~Il.a~~ ~ I 5uu5'' ~~``rr,``,'' 1' 1 ~qd ~1' 11 ~17~Ifll S1 1~4611~I ,II ~1~.,1: i~l~,llr ,r''r~Y~"~ IA ~ Iii I ' ~I 1111 ••fUrl, fllE NI~AIi:,/ dhpf:~S 3fIdU11 III 1~~1 ppl~ ~h~ ,,~~ dl • +I' I Ikelnnr nl ~ srE_uEN u n nQErr ' CAflLI SLE1+ IAI+UVI A 171113 Ih ~II r ~•! J , t,u n4 lip. .;r Ir~~,,~ll: .. i~ WILLIAM A. BASSEiT PtwNSVt.vnNln aslnumw tu+smtTrnnl. neetw-vat M I M i EMPLOYMENT: Steven W. Garrett Renl Estule 124-12G Narlh Hanover Street Carlisle, PA 17013-2421 Phone: 717-243-6646 -FAX: 717-243-H627 EXPERIENCE: r, v~ ii e~ i ,.~ r, t r! 19A6 To Present -Sluff Appraiser Steven W. Uarrett Rcal Estate Associate Ilrokcr, 1990 1')A3 To 19A6 - Mortgage Officer Dauphin Dcpasit Hunk & Trust 1979 To 19A3 -Staff Appraiser York FcdcralSavings & Lonn 197A To 1979 -Appraisal Trainee Joseph McGraw, Inc. Rent Estate Salesman 197A '~ Y APPRAISAL EDUCATION: American Institute of Rcal Es[a[c Appraisers i j Course VIII -Single Family Appraising P>I Single Family Residential Seminar Society of Real Eslatc Appraisers Course 101 -Appraising Real Property j ~ Small Residcn[inl Income Property Appraisal Report Q Penn State University Real Estate Sales and Ethics Real Estate Finance ~~ Other Mortgage Underwriting-First Boston lnveslment Graup EDUCATION: University of Pennsylvania ut State College Easiness Administration, bachelors -December, 19A2 Central Pennsylvania Easiness School Ousiness Administration/Management, Associates -Dec., 1977 CONTINUING EDUCATION: Standards of Professional Practice, Part A Appraisal Institute, March 1991, 1G Hours as A ac ~ ~ I M'- f l , f V 1 M ,,~,~III~ ,IIII; Illll Ilpl'illl~~ 4~oii'!I'dulUl~~r~~4~~ n e ]1i "i~,!}ilu II ~!~ I~xlj~l~y117~•:ll~'; II ~V I ~ ,_ j n ~ ~I~d . 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'• OIIfIIAllll p, f:I1Pg1 ' r`V` IItI DIif.1.Y °Pllgl ti~ r~ ~ ' ~ . / 'd '" ~, 1 1 IAI A11111 /111A f . _.. ~. ~ ~ y 6 ~ I , , r ~ 1It'dl+d. ~ ~ ryn. '.' ~ 1 df ~f T PP ~ t~ 1~ uaM ~ L ~ A' ~ n ~ ,I.` M ! J 11:1 , ~ O: i ~~ ' ,q ~+ . ~. 1 V '1 , , R ~LII .4 G1 s`, IN .. ' a MI H~ ~ d`a ~ ~ ,.. , i I r SlII3JfCT ~ F' ~, (1 ; ,. III pt ® N9YLVANIA ENII-17 J ~1 pIKE t~RN .._ ' _.. P~ - ~ s~ rul Wnlu~ ^ PIAnI Ilgn Inn` • _ 1 . - ru`R71r~- n .r ,MZ.~-n I „• 1 f 11 _.- . '1._- ~1 PNUU~ t ~~ a A '~t11~Cb 1 __ • N IJ ' / 11111 . ,~ .~ ~p .q 1011V.. _f .~ ' I !' i A B C /a•~e~ur •. ,,,• ' . o ,o.. • r /e•v m• D Ems`""'g"2g f G 1, 1) i ta•aro H ~, d too i I '. ,~ ~, ~ ~ 1 ~~ OFD MECHAN IC S B ~U R G ,~ I" ._._ - ~ 1 let/ ~ .r \ b q. t NIeN tOb~ n n 4 ~l + J~' ~} L • i ~' 1 I_' '~ ~ ~ EplIDE~OJIII U R y`1 N 1~ ~ ar ~` O OP 8R ~ ~ `'r'~'' eNl•ttt oc'~J MEADDWOOD ~ a .fit ~ ./K /1 U R ~ w~ wect -- ~ , l ~ P P~ plNt p~ ' l 4ioee.- ~gON R d Jlpp. ~\ °• ,\. ~sR Ir /LI INfI ,_. 1 WE9EgCR0FT, a °~~~` ° ~` .. ~` ~ , p ow JYM~ l a • ' ... •-..... • ~ - w~l Wa Ot•~ J a ' NVf ~ ~ N W~, 9jt ~ SUBJECT ~r __ ~ d D _'~' _ GETTYSBURG t " ,.. ~-'-- _'~-~- INTERCHANGE _ `• IOtI 1• GRAHAM IN ~ ( .dP a_ VILLAGE \ \~,,~ ~ _ I ' ^w- YtLNI [ILO/Net O [J v O ~ `v ~ ~~ ' V eNK i' I`ll u ulf ceLUe~ no' a E T_a aNDINO~IyLL _3~ _ lio Ne HGLID ~t..lYL WEgt 'NIHD`NO.1111_. .: _ - ~-._._ ._: - WINDING ,iM~ ~7_ ~_. ~~ WINb G HILL ~ It J PARK HILL 1='''' ' rr1 HEI `TS~$ i tit y WEST I Ndt I~'~ i' ~" e ' ~ qty It~~ dt/I"Ytta Nrorml r1~ \ i pl ~,./ r L LIYL pert[ ~-.,I~1 141 ~P~ i. l Nl`LI4 p p 1`~C ~-----\~. 11. R R nN1NIprNr --., j', ~' i~o I ~ u~` -.~~~~ cos KIMBEF rr 1 _ ~ ,\ s / ,..:'tt,,11~ If 1,+,,.:- ' ~ „~^~'''LLC a--~ MEADc ARL~ • ~~I •"; p~ Q coNrn oN 1 I •~ 4~r~ ~ ~ L L ~~ e ~ ~IGIQ O / ~ J ~y \( ,1,1~ W \ ri/N~4W`/`\~If.•`L 1~. r rrel NOUfr /lJ- / \ \/,4~y/'' y eJ / Or ill `~ Y/N Clll \~ ( ^rRreY^s ''~ }I ~ U R P MT ALLE "I ry ~ t{~ ~ y.. p//ro nlr" ~ IOI ~ .e. HEl IT,,r ~~ p ~ ~ rirNi.na~~r nalq ,.1 ' RESF.R V( ~ ~ / ~ SPRING flr/''~ •' JI `1 j~ fIILL Al/` ~ r' nA , ~ J -_ Xi ~"a~ ZONING 'L'ADLE OF USE REGULATIONS SCIIEUULI's K ~i t-~ I kr/ { V A. D. INDUS'I'RIAI. UISTRIC7' (IN) This district Is established In accnnunndntc 6,dustrlal dcvclopn,cnt in locations Ihat will constitute a honnonious and opproprieto addhion to lho physical devclopmmu of Upper Allen 7Uwnship. 1'cmtitted uses arc restricted to (hose which arc cmnpntiblc whh adJncenl uses and which have approprime open spaces, landscaping and parking areas. Such uses must 6c carcicJ on In a manner so that they do not wdavorably intrude on other uses In the township.'Phesc uses mny Include industrial uses, such as mnnufacturing m,d assembly, wnrchousing and slomge; bath Light and heavy Industrial uses. In the Industrial District, manufacturing uses am permlucd, provided that no adverse external effects or emissions such as dust, glare, vibration, olectrical or radio disturbance, fumes, vapor or gnscs go beyond the pmpcrty lines creating such potential nuisances. Number I. 2. 3. 4. S. 6. 7. g. 9. 10, 11. 12. Usc Adult cntcrtainmcnt facility Auto gasoline service station Auto body repair garsgc Auto sales Auto washing facility ©nnWfinancial Institution Business services Communication racllity (publicly regulated) Contractor's office and storage Convcrslou opartment crap fannh,g Culturnl racllity I' = I'crmllted SE = Special Exception SLr P P P p 1' P 1' r SG P p ~ l02 r UI'PLR ALLI?N CObL Number Use I' =1'crnrilled S[s=Special Cxcepilon 13. brivedn stood p IA. Ustmctivcopcralluns SLr IS, Pire stnllon p 1~• Orcenhousc p 17. I lospitnl p Ig• Junkynnl SR 19. Manufacturing p 20. Mill p 21. Moriunry/funernl home p 22. Malcl/hotel p 23. 1'nrkh~g lot p 24. Pcrsnnnlservice p cstnblishrncnt 25. Puhlic bullJing p 2~• Public cnlerinhiment p facllity 27. Public rccrcntlonnl p facllity 2g• Repair services p 29. Research, testing or p caperimental Inh 30. Restaurnnl p 31. Sanitary facility gg 32. Shops and slorcs p 33. Signs p 34. Supply utilities SR 35. 'Prnddprofcssionnl p school 3G. T'mnsportnllon tcnninnls p 37. Tracking Icnninals p 38• Wnrchoushtg and storngc p 103 ~~ ~~ ~J !d I~~ 1 rl = _~-- u„ ,Cedar r SUBJECT ~~ SKETCH ADDENDUM I l i a ~ ~ I ~ illlilll ij ~~ i ' ~ ~,; :I1 ~ i ~ a' ~.; :. ~ I .' (L.,. i I '~ i ~ ~ I ~ ~ i I f ;_ !. wACkEHovs~. ~ I I'~ , i ,, ~~ ~;i i ' ~ ijll' ~ ~ ~ II ~iil r~qi ._ ~ f i aido . I I ~ob j i ,. I ~ \p /~I Ililillll i~~ ~ \w f I. '1 ~~ I I I ~ ;;i,l~~~l li ~, i I i I ~. i MCI ii ~I I I ~ I I i l k i 105 a,o~' o.~ I .. ' ~ ' "' ~61~ ~ ,i j ;: i i.. I i j' ''~~,':. ~~ ;~;'; "I , ~'. 1 ~I ~. ~~, ~ ' ~~~ j i FW 79N O 198 Forms nb Wam~ InC. J19 WNlney Ava New Ilnven, CI 0951 I All fignla Reurved 1~90017~JJ5/9 M! ^~yovC F~~' 6omcP n~ . , q ........., .I mnnun. u~ Inuuuu• u a .~.. '~~ ~ ~~d t~ ~~ "'I` n IY111 0 ~ `~ 1111111 ~ eul+ m ~ _ ~~~~~ I m I I f~~~~ ~ tlI6G ^O.e c 11® .._ ~~ Q'/ M ~~ .~ ..... ®~a .... ~'~~~~ ~mm~l ~~ i~~ ~~8~~ m WAREHOUSE 3 WAREHOUSE I m e e R o 0 m_ I~ m m m m Q m m m --1 0 ~. 0. pl f>3~(~~~~ ~~~mmm ,~. ,. CONNECTOR BUILDING / WAREiUUSE.2 ~~~~~Qaoo~d. r-~ _ 004 I pj~{~ ~ 0 0 0 I r.n.n,n a _ _ _a o 0 u - ~~,. IR SCR ; y IOG ~~ ~~~V. ~~~~~. as a a n. . i \; F.1 [~~) i 11 ' !~ !`r~ I F.1" r I I~ 1 {{ i ~) ~~ r ~ { i h4, M ,~ Ncrert ^.nn ul Lr 1x1 In rorarr or real /~ euxnuu~ar ;•rrlr I [IIh SIIVl A:1 Juk 22 3 !s FN'18 TIIIB INDENTURE NADB kh• eth day o! Neyr in the yasr nlna teen hundred •nd ^evanty-a Lght (1978) B E T H E B N Iletslebutg Arae Induskrlal bevelopment Corporeklon, a Penneyl- 1 venle non-protlt aorporeklon having lt• prlncipsl of[lc• !n !hs City o[ her[ieburgx Osuphln Countyr Panneylvsnie (herelns[ter oslled Grenkoc)r oC khe ono pertr A N b Beok-o[-lho-Month Club, Ino.x a corporation organleed under the levee o[ !ha ate to o! New York, hevlnp !k• prinolpal o[[ic• !n New Yorkl Naw Ycrk (harelna[kar celled brentee), of khe other peril H I T~N B A B B T II Thak the said Grantor for end Sn conelderetion of the cum of Ona boner IC I.OOIr lewlul money o[ tho Unlted Bka tee oC Amerloar unto it wail and truly paid by kho Bald Orsnkae st end ba [or• kh• ^eelln9 and dallvery o[ khaee proentar the receipt whe no! S• hereby •oknowledged, he^ grentadr bergslnadr ^ol d, sllenedl anfeo[fedx raleesadr conveyed end con[irmed, end by these pre cents does grenk/ bergelnr ^ellr ellenr anfeaC [, ra leeael convey end conClrm unko khe eeld Oran to e, its eueeaeaore end aeelgna. ALL TIIAT CERTAIN kreck of lend eltuete !n Uppor Allen Township) Cumberland Coun tyl Panneylvanle, bnundod end da ecrlbed in accordance wlkh a survey and plan msds by b. P. Reffenepergar, Ragiekatad Burveyorr dated .tuna 70, 1967r es follower euoi~~/27 rlcr 260 107 r ~~ it A ~..~' 1 ~ ' i ~i , `j i I, kl t1 I {+ lri I ' i~ f1 ' .I t t I ~ tut ~I ~ II r.. ( I n. ~ !I ~I i ,~ 'i ~~ OLO[NNINO a! a po In t, ma rk •d by a railroad ep lke, !n the canlsr Ilne of Okele II lghwey Houle No., 111 lead lnq from Machanlcs- burq to eha pherdelovn, eomaklmas known ea ~ndereon Roed, said point be lnq a! !ha norkhern rlghl-of-way 11ne of the Penneylvenle Tur np lkal thence eMtand lnq along khe center line oL Noute No. 111 nor lh 70 degraee 7] minu tee week S93,B9 Leat !o a point oL eucvel !hence conllnu lnq along ee ld center Slne !n a northerly direction en a curve to the lei! having a fed lue o[ 1,910.00 feat Lor the eto die ranee of 570.06 Leek to a Hell in Ilna o[ land [o[metly a[ L. 0. ~ndareon, nov oL h. C. Neyharryt thence dlonq said lend north 66 degraee /0 minu las seek 101.17 teat !o ~o e •t okel khenee ^k111 •lonq old land north 71 degru^ )0 minulee vest 100 feat to a pipe In line of lend of the Chrletlan tl. Ile ee ee le let thence along Bald land o[ the Ile ee estate the (our 11) following caureaa end dletanceet Ill north 66 deg reae seek 1,/Se.q] Lee! to a ekonel 131 nnrlh 66 degraee 6 minulee ]0 eeeonde seek 30J.3S feet !o a po^tl (]) south 6 degraee I minulee seat 173.0] Lee! ko a etekel end 111 south /3 degraee 17 minu tee Beet 670.]) leak to a pipe et a corner o[ land now tlt lets a[ Cetl Henkrt klie ncs along Geld land of Hants the three 171 Lollowing coot see end die lenceet Ill sou tN S7 degrees 16 minu lea woe! 761.76 teal !o a pearl I31 south 7B degrees 11 m(nuteo east 760.53 feat to a atone end n cherry It eel end 171 eoulh 16 dog reae I7 minutes wa et 61.]9 feet to a ekeka on the nnr thetn rlghl-oC-way line of the Pn nne ylvenle fur np lkel thence along said tlgli l-ot-way Ilne In a westerly d beck tan on a curve to ll~o loft Ilevln9 a red lue o[ 11,559.19 feet for the arc diets ncs oC 1,059.0) [eat to n po lnt o[ le ngancyt thence conklnu lnq nlon9 nn ld rl9h t-of-wny line north - 7 - IOR A w ~~ i ~~ ', 11 ~i ~~ i~ I'~ t'!) ~~ 1 W .... ~. rr r_ I I i i i I i i I I _.. , B6x degrees 29 minutes west !11.97 (eat ko !ha point and plec• o[ bEOINNINO. CONTIII NI110 x.6.76 acres oL Innd. hEihO the enure ptemlees which Po~ik-ahlhe~Monk llh-61u~~ A/~/ br (ne.~ granted and convPyad unto Ilerrleburq Arae Induekrlel bevelopmenk Corporation, by bead dekad ,;rp'sre6c~ /_ /p,.~ , and taco rdad !n kha hecorder oL heeds af[!ce [ar Cumberland county on 9 7 G , in baud OOOk ~, Vol. oT,7, psga ~. Under end Bubleck to kha aecumpk/on o[ psymenk by 6rante• at a carkeln mortgage deb! or principal eum o[ Ona hllllon One Ilund[ad elakaen Thousand tour Ilundred Twonty hollers (tl,lll,170.00) (reduced !o ~7]O.IBI.B] by paynen!• on accaunkl wlkh interest !hereon ee kl,a eeme may become due end payable. TOOETIIEh wllh all end singular the etruckuree, [laturae, Impravemenle, ways, streets, allays, psaeegae, waters, welar- coutaas, rights, 116erklee, pr lvllagae, heradlkemenke end and appurlenencas whatsoever !hereon to belonging, or !n anywise epperkalnlnq, •nd !'o reveralon •nd remainder ^, rank ^, leauu end ptoLlk^ theteo (, end ell the •etnke, right, kltle, lnteraat, properly, elelm end demand whekaoever o[ the said Orsnko r, In law •nd aqulky, or olharwlse howaoava r, oL, !n, end !o the eeme and every perk there of. TO IIAVE ANb 70 IIOLb the sold haredlkamenke end ptemlees M eteby grenkad, or manklo ned end lnkended so ko be,'wlth !ha •ppurkenencae, unko kho veld Orenkee, lte successors and ens lgnn forever. Under end Bubfeck !o rho assumption oL payment by Orentae o[ a cetknln mot [q nge clebk or pr lnclpnl eum o[ One Mllllon ,I ~ i i f I II . - 1 - EBBI~}27 11tt 2G2 I09 , ;i ~I ~~~ ,, I 1-. F~ , f{ e! I{ !! ~~ ~1 M w I ' r i ar ar 0n• Ilundred 8le teen Thouennd tout Ilu ndrad 7wsnly Dollere (11,116,170.08) (reduced to e7~°, ~~~~g~_ by paymenla on ecoountl wlth lntereet thereon as thaeems may become due end payable. 11110 the sold Orentor, for !keel( and 1!e eucceeeare doa• by kheea presents cove nent, q nn! end eq ree, to and wllh th• sa ld Oran lee, !!e eucceeeora end aye lg ne, kllet lt, the ea ld ocentorl and !te succeeeore, all end slog ul er the heradltemante end premisee hareln deecr lhed end granted, or menllon ed and Intended eo to be. wl th the eppurlenancae, unto khe veld Grantee, !te euceeeeors end eeslgnel egalnet !t !ha eeld ocentor end !t• euccaesore, end agelns! all and evacy othor person end pereone whomsoever, lawfully clalminq or to elelm the same! or any part !hereof, by, through, trop or under the Grantor, •hsll •nd wlll W11PPaNT end tocevet DEPEND, IN WITNB88 WIIEPEOP, the se ld orentac, hoe ceueed this lndanture to be executed by Ire Preeldent, etteeted by Ste eecratery, end 1!e corporate eeel to be et[lxed the day end year llcet wrl!!an above, Elgned, Heeled end Dellveced In the Preeanca otl I ~rh`T r euoxy~27 PA[F 263 'r•' '4 ',t :,1 ~. ~::.. I10 W ~i ~~ I i) ! )~ i `a {f 1 h~ fl rl ) ~~ ( ' k1 i 1 ey -. i .- 1 CONNOInO:N.T1i Of PP.lINBYLV7W IA 1 1 BBt i COUNTY Of DIIUPIIIN 1 I hereby cert![y, that on khle Bth dey a! Mey, !n th• 1 year o! out Lord one khoueend nln• hundred end eavenly-eighk (1978) be[ora me, the eubeariber, r Nokery Public, personally sppeered John I1. Baum who acknowledged himself to ba tho Preel- denk o[ Ile rri aburg !\rae Industrlel development Corpora Lion end that he e9 such Praeldentl being sukhorired ao ko do, executed khe [aregoln9 Indenkure !or khs pucpoeoe khezein contelned on by ^lgnlnq hie name es President. . N3TNEBE my hand and Note rlel ^eel the dey end year storeseld. EA L. ,7 No w ~ICL~brurlul 4 14 n I hereby certl [y khek the preolu •ddree• o['[F16e anh• wr hetaln iel 1335 Sou t11 Msrkek street Nechenlceburg, /Ppnnsylvenle 170~5'S CONNOINiE1U,TIi OF PENNBYLVMIIII 1 Vlld//~/d 'JJ V,.uI, ~•p 1 BE 1 ~ ~/ COUNTY O- CUHOEELAND 1 ALCOROED !n the Oftlae for the Eacordlnq o[ beads, Eto., in and !or •sid Cotlnky, in Dsed Book Na. ~, Vol µ , Pega Q NITNEBB my hand end ot[iclel seal khl°~~~ ey~ot' "u,r ~u 1978. / `` ~~ v~ r a oo s -s- eao~27 IAS- 2G9 11! BOOK OF THE MONTH CLUB, INC„ IN THE COURT OF COMMON PLEAS OF PETITIONER CUMBERLAND COUNTY, PENNSYLVANIA V, BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, RESPONDENT 94-6538 CIVIL TERM V. MECHANICSBURG SCHOOL DISTRICT, INTERVENOR IN RE: ASSESSMENT APPEAL ORDER OF COURT AND NOW, this ~ b day of September, 1995: (1) The common level ratio for the 1995 tax year is 7.5%, For the 1998 tax year it is 7.3%. (2) The actual value of the subject property is 57,900,000. By the Courts i ~i ~_1u..~~ Edgar B. Richard P. Nuffort, Esquire For the Book of the Month Club, Inc. Stephen D. Tiley, Esquire For Board of Assessment Appeals Richard C. Snetbaker, Esquire For Mechanicsburg Ares School District :saa y • ~'• SEP i ; ~ 51~Iu~95 BOOK OF THE MONTH CLUB, INC„ IN THE COURT OF COMMON PLEAS OF PETITIONER CUMBERLAND COUNTY, PENNSYLVANIA V, BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, RESPONDENT :948538 CIVIL TERM V, MECHANICSBURd SCHOOL DISTRICT, INTERVENOR IN RE: ASSESSMENT APPEAL OPINION AND ORDER OF COURT BAYLEY, J., September 28, 1995:-- Petitloner, Book o} the Month Club, Inc., filed this appeal from the assessment by respondent, Board of Assessment Appeals of Cumberland County, of its property In Upper Allen Township, Cumberland County. The Mechanicsburg School District, where the property is located, has intervened. The parties stipulated that the common level ratio for the 1995 tax year is 7.5%, and for the 1998 tax year it is 7.3%. The property Is currently assessed at $862,500, which, using a 7.5% ratio, indicates an actual value of 511,500,000. The Board of Assessment Appeals determined that the actual value is 510,800,000. A de novo hearing was held before this court on August 31, 1995. The Fourth to Eighth Class County Assessment Law at 72 P.S. Section 5453,802(a) mandates that the court determine the "actual value" of petitioner's BOOK OF THE MONTH CLUB, INC., PETITIONER IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. BOARD OF ASSESSMENT APPEALS OF CUMBERLAND COUNTY, RESPONDENT 946536 CIVIL TERM V. MECHANICSBURG SCHOOL DISTRICT, INTERVENOR IN RE: ASSESSMENT APPEAL OPINION AND ORDER OF COURT BAYLEY, J., September 28, 1995:- Petitioner, Book of the Month Club, Inc., filed this appeal from the assessment by respondent, Board of Assessment Appeals of Cumberland County, of Its property in Upper Allen Township, Cumberland County. The Mechanicsburg School District, where the property is located, has Intervened. The parties stipulated that the common level ratio for the 1995 tax year Is 7.5%, and for the 1996 tax year it is 7.3%. The property is currently assessed at $862,500, which, using a 7.5% ratio, indicates an actual value of 511,500,000. The Board of Assessment Appeals determined that the actual value is 510,800,000. A de novo hearing was held before this court on August 31, 1995. The Fourth to Eighth Class County Assessment Law at 72 P.S. Section 5453.602(a) mandates that the court determine the "actual value" of petitioner's 94-8538 CIVIL TERM property. In County of Monroe v. Plnecrest Development Corp., 98 Pa. Commw. 200 (1986), the Commonwealth Court stated: Pennsylvania case law has consistently held that actual market value is that price which a purchasers, willing but not obligated to buy, would pay an owner, willing but not obiigated to sell, taking Into cons(deratlon all uses for which the property is adapted and might in reason be applied. We must weigh all of the evidence and Judge the credibility of all of the witnesses. Cumberland Valley School District v. Cumberland County Board of Assessment Appeals, 125 Pa. Commw. 649 (1989), The function of the court is "to weigh the conflicting testimony and values expressed by the competing experts and arrive at a valuation based upon the credibility of their opinions." County of Monroe v. Bolus, 149 Pa. Commw. 458 (1992). Petitioner's property is 68.26 acres. Petitioner has owned it since May, 1978. The property is used for offices, warehousing, packaging, and the mailing of books. The site is In an Industrial District under the Upper Allen Township Zoning Ordinance. The property Iles between South Market Street (Pennsylvania Route 114), and the Pennsylvania Turnpike. There are approximately 360,000 square feet of Improvements of which approximately 97,000 square feet are office space. There are three warehouses and a connecter between the two main warehouses which is also utilized for warehouse space. The improvements were added between the late 1960's and 1988. They are of average construction and generally wEll-maintained. While there is some physical deterioration in the office facil(tles, petitioner has a program to -2- 94-6538 CIVIL TERM property. In County of Monroe v. Pinecreat Development Corp., 96 Pa. Commw. 200 (1986), the Commonwealth Court stated: Pennsylvania case law has consistently held that actual market value is that price which a purchasers, willing but not obligated to buy, would pay an owner, willing but not obligated to sell, taking Into consideration all uses for which the property is adapted and might In reason be applied. We must weigh all of the evidence and Judge the credibility of all of the witnesses. Cumberland Valley School District v. Cumberland County Board of Assessment Appeals, 125 Pa. Commw. 649 (1989). The function of the court is "to weigh the conflicting testimony and values expressed by the competing experts and arrive at a valuation based upon the credibility of their opinions." County of Monroe v. Bolus, 149 Pa. Commw. 458 (1992). Petitioner's property Is 68.26 acres. Petitioner has owned it since May, 1978. The property is used for offices, warehousing, packaging, and the mailing of books. The site Is in an Industrial District under the Upper Allen Township Zoning Ordinance. The property Iles between South Market Street (Pennsylvania Route 114), and the Pennsylvania Turnpike. There are approximately 360,000 square feet of Improvements of which approximately 97,000 square feet are office space. There are three warehouses and a connecter between the two main warehouses which is also utilized for warehouse space. The improvements were added between the late 1960's and 1988, They are of average construction and generally well•malntained. While there is some physical deterioration in the office facilities, petitioner has a program to -2- 948538 CIVIL TERM remodernize that space. Paul W. Shoup, Sr., MAI, CAE, CMI, testified for petitioner, He considered the highest and best use of the property to be continued Industrial use in Its present form. He defined industrial use to Include warehouse/distribution with the small amount of packaging that is currently done on the premises. Shoup considered the cost approach, sales comparison approach and Income approach In arriving at actual value. Because the facilities are older, which makes adjustment for depredation difficult, he believed the cost approach was too subjective as a rel(able indication of actual value. Using market data in a sales comparison approach, Shoup considered two properties in Montgomery County and one each in Bucks, Chester and Cumberland Counties. The Cumberland County property, Nestles Food Company, grantor, to Fry Communications, Inc., grantee, on November 19, 1992, was also used as a comparable by the appraiser for respondent and Intervenor. Shoup valued the land and (mprovements at $5,489,415, with excess land of $1,813,000, for an actual value rounded off of $7,100,000. Using an Income approach, he valued the Improvements at $5,900,000, with excess land of $1,600,000, for an actual value of $7,500,000. Shoup believed that the Income approach confirmed his market analysis, which he considered the best approach. Overall, Shoup was of the opinion that the actual fair market value of the property Is 57,100,000. This was sufficient, competent, credible, and relevant evidence to overcome the prima facie validity of the assessment. See, Deitch Company v. Board of Property Assessment, 417 Pa. 213 -3- 948538 CIVIL TERM remodernize that space. Paul W. Shoup, Sr., MAI, CAE, CMI, testified for petitioner. He considered the highest and best use of the property to be continued industrial use In Its present form. He defined Industrial use to Include warehouse/distribution with the small amount of packaging that Is currently done on the premises. Shoup considered the cost approach, sales comparison approach and Income approach In arriving at actual value. Because tho facilities are older, which makes adjustment for depreciation difficult, he believed the cost approach was tao subjective as a reliable indication of actual value. Using market data in a sales comparison approach, Shoup considered two properties in Montgomery County and one each In Bucks, Chester and Cumberland Counties. The Cumberland County property, Nestles Food Company, grantor, to Fry Communications, Inc„ grantee, on November 19, 1992, was also used as s comparable by the appraiser for respondent and Intervenor. Shoup valued the land and Improvements at $5,489,415, with excess land of $1,813,000, for an actual value rounded off of $7,100,000. Using an Income approach, he valued the Improvements at $5,900,000, with excess land of $1,600,000, for an actual value of $7,500,000. Shoup believed that the income approach confirmed his market analysis, which he considered the best approach. Overall, Shoup was of the opinion that the actual fair market value of the property is 57,100,000. This was sufficient, competent, credible, and relevant evidence to overcome the prima facie validity of the assessment. See, Deitch Company v. Board of Property Assessment, 417 Pa, 213 -3- 946536 CIVIL TERM (1965). Steven W, Barrett, SRPA, SRA, ASA, CPE, testified for respondent and Intervenor. He considered the highest and best use of the property to be Its present use as a warehouse/storage facility. Barrett considered the three basic approaches to valuation. He was of the opinion that the actual value of an industrial/warehouse facility such as the subject property cannot be reliably determined using an Income approach. Using market data In a sales comparison approach, Barrett considered four properties In Cumberland County, three in Dauphin County and one in Lancaster County. He valued the Improvements and land at $6,200,000, with excess land of $788,655, for an actual value rounded off of $8,989,000. Using a cost approach, he was of the opinion that the total actual value was $9,400,000. Barrett believed that the cost approach validated his sales comparison approach, to which he gave the most weight as the best approach. Overall, Barrett was of the op(nlon that the actual fair market value of the property Is x9,000,000. Both appraisers agreed that there Is a strong regional distribution market in this area. However, Slioup, the appraiser for petitioner, believed that the ratio of office space to warehouse space In this older property is high for that market. He believed the property has ten percent excess office space which is functionally obsolete in this marketplace. Shoup concluded that the functlonable adaptability of the subject property to the current strong market for warehousing Is limited by the excess office space. To the contrary, Barrett, the appraiser for intervenor and respondent, did not -4 946536 CIVIL TERM (1985). Steven W. Barrett, SRPA, SRA, ASA, CPE, testified for respondent and Intervenor. He considered the highest and best use of the property to be its present use as a warehouse/storage facility, Barrett considered the three basic approaches to valuation. He was of the opinion that the actual va~uo of an Industrial/warehouse facility such as the subject property cannot be reliably determined using an Income approach. Using market data In a sales comparison approach, Barrett considered four properties in Cumberland County, three in Dauphin County and one In Lancaster County. He valued the improvements and land at $8,200,000, with excess land of $788,855, for an actual value rounded off of $8,989,000. Using a cost approach, he was of the opinion that the total actual value was $9,400,000. Barrett believed that the cost approach validated his sales comparison approach, to which he gave the most weight as the best approach. Overall, Barrett was of the opinion that the actual fair market value of the property Is 59,000,000. Both appraisers agreed that there is a strong regional distribution market In this area. However, Shoup, the appraiser for petitioner, believed that the ratio of office space to warehouse space in this older property is high for that market. He believed the property has ten percent excess office space which (s functionally obsolete in this marketplace. Shoup concluded that the functionable adaptability of the subject property to the current strong market for warehousing is limited by the excess office space. To the contrary, Barrett, the appraiser for Intervenor and respondent, did not -4 846538 CIVIL TERM believe that the amount of office space In the property adversely affects Its current market value. Citing an IBM facility in Mechanicsburg and a Kinney Shoe facility in Carlisle, Barrett noted that warehouse/office facilities with higher percentages of office space are located in this area. However, IBM and Kinney Shoe are older facilities that could not be used in a sales comparison analysis because of the lack of any recent market activity. Barrett did not believe that the subject property suffers from any functional depreciation despite Its separate warehouse and connected buildings with different calling heights. The credible evidence shows that the strong demand in the current market (n this area is for large single warehouse/distribution facilities built to suit, with little office space. That is well reflected in the properties Barrett cons(dered as comparables. The difference in the opinions of the appraisers as to the significance of the large amount of office space as it relates to the actual value of the subject property can be seen in the adjustments both made in their consideration of the Fry Communications' property, their common comparable. That large single warehouse/distribution building has far less office space than the subject property, Yet Barrett made an adjustment for that office space as 20% inferior to the subject property, while Shoup adjusted it as 10% superior to the subject property. All of the properties used as comparables by Barrett had substantially less office space than the subject property. We conclude that the credible evidence shows that the large amount of office space and the layout of the older buildings In the subject property make it Inferior to -5- 948538 CIVIL TERM the warehouse/distribution comparables used by Barrett end should have been so adjusted, While the office space and layout has unique value to petitioners given their current use of the facility, a "property's use and Its resulting value-in-use cannot be considered In assessing the fair market value of property for tax assessment purposes In Pennsylvania," F & M Schaeffer Brewing Company v. Lehigh County Board of Appeals, 530 Pa, 451 (1992). The demand of the market is greater for warehouse/distribution centers with less office space than the subject property. On the other hand, while the comparables in the larger region considered by Shoup are of probative value, contrary to the parochial view taken by counsel for the Board, we conclude that the credible evidence shows Shoup did not sufficiently adjust for the stronger market demand for warehouse/distribution facilities in the regional distribution hub of greater Harrisburg, which includes the eastern part of Cumberland County where the subject property is located. The fact that the Cumberland County appraiser, the Board of Assessment Appeals, Shoup and Barrett can be so far apart is testament to the difficulty of deterrnining the actual value of an older warehouse/distribution facility. Many subjective adjustrnents have to be made when using the sales comparison approach, which is still the most reliable method of appraisal. To compound that difficulty, the two appraisers did not even agree as to whether a cost approach or an Income approach is the next best method for providing some validation to their sales comparisons. The thorough analysis used by both of these competent appraisers, -8- 948538 CIVIL TERM however, clearly shows that the actual value reflected by the current assessment, even with the reduction made by the Board, is far too high, We have carefully reviewed the two appraisals submitted Into evidence. Having considered all of the evidence and weighed the conflicting testimony and values expressed by the appraisers in arriving at a valuation, and based upon the credibility of their opinions, we find that the actual value of the subject property Is 57,900,000. Accordingly, the following order Is entered, OaDER OF COURT AND NOW, this 2b day of September, 1895: (1) The common level ratio for the 1995 tax year is 7.5%. For the 1998 tax year It is 7.3%. (2) The actual value of the subject property Is 57,900,000. By the Court, J ~ ' UV~~ ~ /: Edgar B. ay ey, J. ~~ Richard P. Nuffort, Esquire For the Book of the Month Club, Ina Stephen D. Tiley, Esquire For Board of Assessment Appeals Richard C. Snelbaker, Esquire For Mechanicsburg Area School District :saa 7-