Sheraton Hotel Redding At Sundial Bridge - Redding Record ...

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a commercially zoned district with a specific plan that allows for hotel, restaurant, office, and retail uses, among other uses. 2. Physically possible use. What uses of the site are physically possible? The subject site is large enough to support most smaller-scale commercial developments, certainly a hotel, restaurant, office, or strip retail development defined under legal uses permitted. The topography is appropriate and access is adequate for these types of developments. 3. Financially feasible use. Which possible and permissible uses will produce a net return to the owner of the site? Given that current market rates of return do not support the construction of the proposed hotel, the developer would have to accept a lower rates-ofreturn requirement in order to make this project financially feasible. Very little new commercial construction is underway in the area due to the challenging economic trends. At this time, it is our opinion that the highest and best use of the land is to hold for future development. 4. Maximally productive use. Among the feasible uses, which use will produce the highest net return or the highest present worth? Given the proposed hotel project is not financially feasible at this time, it is our opinion that the highest and best use is to hold for future development. February-2011 Highest and Best Use Sheraton Hotel Redding At Sundial Bridge – Redding, California 66
9. Approaches to Value Income Capitalization Approach Sales Comparison Approach Cost Approach Reconciliation In appraising real estate for market value, three approaches to value are considered: income capitalization, cost, and sales comparison. Basic summaries of each approach are provided as follows; please refer to the introduction of each respective chapter for additional description. The income capitalization approach analyzes a property's ability to generate financial returns as an investment. The appraisal estimates a property's operating cash flow, and the result is utilized in a direct capitalization technique and a discounted cash flow analysis. The income capitalization approach is often selected as the preferred valuation method for operating properties because it most closely reflects the investment rationale of knowledgeable buyers. The sales comparison approach estimates the value of a property by comparing it to similar properties sold on the open market. To obtain a supportable estimate of value, the sales price of a comparable property must be adjusted to reflect any dissimilarity between it and the property being appraised. The sales comparison approach is most useful in the case of simple forms of real estate such as vacant land and single-family homes, where the properties are homogeneous and the adjustments are few and relatively simple to compute. In the case of complex investments such as hotels, where the adjustments are numerous and more difficult to quantify, the sales comparison approach loses much of its reliability. The cost approach estimates market value by computing the current cost of replacing the property and subtracting any depreciation resulting from deterioration and obsolescence. The value of the land is then added to the depreciated value. The cost approach is most reliable for estimating the value of new properties; therefore, this approach is particularly applicable for this project given its proposed nature. The final step in the valuation process is the reconciliation and correlation of the value indications. Factors that are considered in assessing the reliability of each approach include the purpose of the appraisal, the nature of the subject property, and the reliability of the data used. In the reconciliation, the applicability and supportability of each approach are considered and the range of value indications is examined. The most significant weight is given to the approach that produces the most reliable solution and most closely reflects the criteria used by typical February-2011 Approaches to Value Sheraton Hotel Redding At Sundial Bridge – Redding, California 67
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February-2011 SUMMARY APPRAISAL REP
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stabilization. Based on our analysi
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Table of Contents SECTION TITLE PAG
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SUMMARY OF VALUE PARAMETERS Number
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2. Nature of the Assignment Subject
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Objective of the Appraisal an annua
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Exposure Period The hotel is expect
Page 15 and 16: Competency Scope of Work While mark
Page 17 and 18: 3. Description of the Site and Neig
Page 19 and 20: Physical Characteristics HOTEL SITE
Page 21 and 22: SUBJECT SITE RENDERING AND SHARED P
Page 23 and 24: Turtle Bay Exploration Park The sub
Page 25 and 26: 4. Description of the Proposed Proj
Page 27 and 28: Summary of the Facilities RENDERING
Page 29 and 30: Public Areas all signage will adequ
Page 31 and 32: Guestrooms Back-of-the-House ADA an
Page 33 and 34: 5. Market Area Analysis Market Area
Page 35 and 36: FIGURE 5-1 ECONOMIC AND DEMOGRAPHIC
Page 37 and 38: FIGURE 5-2 HISTORICAL AND PROJECTED
Page 39 and 40: Unemployment Statistics increased u
Page 41 and 42: Airport Traffic Airport passenger c
Page 43 and 44: Tourist Attractions Additionally, t
Page 45 and 46: Conclusion frontage is back to norm
Page 47 and 48: FIGURE 6-1 HISTORICAL SUPPLY AND DE
Page 49 and 50: FIGURE 6-2 MONTHLY OCCUPANCY TRENDS
Page 51 and 52: FIGURE 6-4 COMPETITORS - OPERATING
Page 53 and 54: FIGURE 6-5 NEW SUPPLY DEMAND Propos
Page 55 and 56: FIGURE 6-8 AVERAGE ANNUAL COMPOUNDE
Page 57 and 58: 7. Projection of Occupancy and Aver
Page 59 and 60: occupancy rate has been positioned
Page 61 and 62: Competitive Position calculated by
Page 63 and 64: FIGURE 7-6 MARKET AND SUBJECT PROPE
Page 65: 8. Highest and Best Use As if Vacan
Page 69 and 70: 10. Income Capitalization Approach
Page 71 and 72: FIGURE 10-1 COMPARABLE OPERATING ST
Page 73 and 74: FIGURE 10-3 COMPARABLE OPERATING ST
Page 75 and 76: FIGURE 10-4 DETAILED FORECAST OF IN
Page 77 and 78: Forecast of Income and Expense The
Page 79 and 80: available room. We expect the propo
Page 81 and 82: INCOME CAPITALIZATION Mortgage Comp
Page 83 and 84: Equity Component & Equity Yield Rat
Page 85 and 86: Terminal Capitalization Rate 20% fo
Page 87 and 88: Mathematical Proof of Value The val
Page 89 and 90: Our debt coverage ratio falls withi
Page 91 and 92: Derived Capitalization Rates FIGURE
Page 93 and 94: Discounted Cash Flow Analysis - “
Page 95 and 96: Discounted Cash Flow Analysis - “
Page 97 and 98: 11. Sales Comparison Approach Compa
Page 99 and 100: FIGURE 11-2 SUMMARY OF SELECTED COM
Page 101 and 102: Sale#2 Sheraton Delfina Santa Monic
Page 103 and 104: Sale#4 Holiday Inn Laguna Hills Lag
Page 105 and 106: Conclusion the subject’s leasehol
Page 107 and 108: FIGURE 12-1 SUBJECT PROPERTY CONSTR
Page 109 and 110: FIGURE 12-2 SUMMARY OF HOTEL GROUND
Page 111 and 112: FIGURE 12-4 DISCOUNTED CASH FLOW AN
Page 113 and 114: Pre-Opening and Working Capital Cos
Page 115 and 116: 13. Reconciliation of Value Indicat
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yet, in fact, exist as of the date
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9. The Americans with Disabilities
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proposed project and/or the market
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of Professional Ethics and the Stan
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calculating the hotel’s market sh
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COMMERCIAL SEGMENT PROJECTIONS (YEA
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NI = Net income available for debt
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NI 1 - (f x M x V) = de 1 NI 2 - (f
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Using these known variables, the fo
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Page 2 Suzanne R Mellen 01/10/2011
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Page 4 Suzanne R Mellen 01/10/2011
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Addenda Requirements - certificatio
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EXAMPLES OF CORPORATE AND INSTITUTI
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Elaine Sahlins EMPLOYMENT 1997 - pr
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EXAMPLES OF PROPERTIES APPRAISED OR
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PROFESSIONAL AFFILIATIONS EDUCATION
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APPEARANCE AS AN EXPERT WITNESS, CO
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