methodology guide- valuing marinas in ontario · ∞ ensure that mpac’s methodology for valuing...
Post on 18-Mar-2020
5 Views
Preview:
TRANSCRIPT
METHODOLOGYGUIDE
VALUINGMARINASINONTARIO
ValuationDate:January1,2016
AUGUST2016
August22,2016
TheMunicipalPropertyAssessmentCorporation(MPAC)isresponsibleforaccuratelyassessingandclassifyingpropertyinOntarioforthepurposesofmunicipalandeducationtaxes.
InOntario’sassessmentsystem,MPACassessesyourpropertyvalueeveryfouryears.Thisyear,MPACisupdatingthevalueofeverypropertyintheprovincetoreflectthelegislatedvaluationdateofJanuary1,2016.
MPACiscommittedtoprovideOntariopropertyowners,municipalitiesandallitsstakeholderswiththebestpossibleservicethroughtransparency,predictabilityandaccuracyinvalues.Aspartofthiscommitment,MPAChasdefinedthreelevelsofdisclosureofinformationinsupportofitsdeliveryofthisyear’sassessmentupdate.ThisMethodologyGuideisthefirstlevelofinformationdisclosure.
ThisguideprovidesanoverviewofthevaluationmethodologyundertakenbyMPACwhenassessingmarinapropertiesforthisyear’supdateensuringthemethodologyforvaluingthesepropertiesiswelldocumentedandinalignmentwithindustrystandards.
Propertyownerscanaccessadditionalinformationabouttheirownpropertiesthroughaboutmyproperty.ca.Logininformationforaboutmyproperty.caisprovidedoneachPropertyAssessmentNoticemailedthisyear.AdditionalinformationaboutMPACcanbeaccessedatmpac.ca.
AntoniWisniowski
PresidentandChiefAdministrativeOfficer
RoseMcLean,M.I.M.A.
ChiefOperatingOfficer
TableofContents
1.0INTRODUCTION...................................................................................................................4
1.1PROPERTIESCOVEREDBYTHISMETHODOLOGYGUIDE.......................................................................4
1.2LEGISLATION.............................................................................................................................5
1.3CLASSIFICATION.........................................................................................................................5
1.4THEUSEOFTHISMETHODOLOGYGUIDE........................................................................................6
1.5CONSULTATIONANDDISCLOSURE..................................................................................................7
2.0THEVALUATIONPROCESS...................................................................................................8
2.1OUTLINE..................................................................................................................................8
2.2APPROACH...............................................................................................................................9
2.3DATACOLLECTION.....................................................................................................................9
2.4DATAANALYSIS.......................................................................................................................12
2.5VALUATION.............................................................................................................................12
2.6VALIDATINGTHERESULTS..........................................................................................................12
3.0THEVALUATION................................................................................................................13
3.1COSTAPPROACHOVERVIEW......................................................................................................13
3.2LANDVALUATION....................................................................................................................14
3.3MARINASITEIMPROVEMENTS....................................................................................................14
3.4ESTABLISHINGCOSTNEW..........................................................................................................16
3.5DEDUCTINGDEPRECIATION/OBSOLESCENCE.................................................................................16
3.6MARKETVALUECONCLUSION.....................................................................................................18
3.7CURRENTVALUEASSESSMENTS..................................................................................................18
3.8CONCLUSION...........................................................................................................................18
APPENDIXA:SAMPLEVALUATION–MARINA.........................................................................19
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 4
1.0Introduction
TheMunicipalPropertyAssessmentCorporation(MPAC)–mpac.ca–isresponsibleforaccuratelyassessingandclassifyingpropertyinOntarioforthepurposesofmunicipalandeducationtaxation.
InOntario,propertyassessmentsareupdatedonthebasisofafour-yearassessmentcycle.Thenextprovince-wideAssessmentUpdatewilltakeplacein2016,whenMPACwillupdatetheassessmentsofOntario’snearlyfivemillionpropertiestoreflectthelegislatedvaluationdateofJanuary1,2016.Assessmentsupdatedforthe2016baseyearareineffectforthe2017–2020propertytaxyears.Ontario’sassessmentphase-inprogramprescribesthatassessmentincreasesarephasedinoverafour-yearperiod.Anydecreasesinassessmentareappliedimmediately.
Itisimportanttoensurethatthevaluationmethodologyappliediscapableofprovidingarealisticestimateofcurrentvalueattherelevantvaluationdate,which,inturn,enablesallstakeholderstounderstandthevaluationprocessandhaveconfidenceinthefairnessandconsistencyofitsoutcome.
ThisMethodologyGuidehasbeenpreparedforthebenefitofMPACassessors,propertyownersandtheirrepresentatives,municipalitiesandtheirrepresentatives,AssessmentReviewBoardmembers,provincialofficials,andthegeneralpublic.
Thisguideoutlinesthevaluationprocesstobefollowedbyanassessor,includingstepsthatrequireappraisaljudgment.Itisincumbentupontheassessortomakeinformeddecisionsthroughoutthevaluationprocesswhenarrivingatestimatesincurrentvalue.
1.1PropertiesCoveredbyThisMethodologyGuide
ThisMethodologyGuideappliestomarinasinOntario.Amarinaisaboatbasinthatprovidesdockingandotherservicestopleasurecrafts.Itisastructurethatallowsvesselstobedockedforloadingandunloadingandisusuallyconstructedparalleltoashoreline.
Therearethreemarinacategories:
• recreationalmarinas(whereboatersusetheirboatsforpleasureornon-commercialactivities)
• yachtclubs(recreationalmarinawithlargebuildingsformemberstouse)
• boatyards(whichoffersignificantrepairsandservicesforlargeboats,yachtsandcommercialfishingvessels)
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 5
ThefollowingMPACpropertycodesareusedtocategorizethevarioustypesofmarinasinOntario:
• 492Marina–awaterfrontcommercialfacilityforthemaintenance,storage,serviceand/orsaleofwatercraft
• 493Marina-acommercialfacilityforthemaintenance,storage,serviceand/orsaleofwatercraftthatisnotonthewaterfront
Itshouldbenotedthatthesearegeneralguidelinesthatvarydependingonthespecificcircumstancesofaparticularproperty.
AnassessormayalsomakereferencetoadditionalMethodologyGuidesforpropertiesthatdonotfallpreciselywithinthedescriptionofoneofthepropertycodeslistedabove.
1.2Legislation
ThemainlegislationgoverningtheassessmentofpropertiesinOntarioforpropertytaxpurposesiscontainedintheAssessmentAct.1
TheActcontainsimportantdefinitionsandstatesthatallpropertyinOntarioisliabletoassessmentandtaxation,subjecttosomeexemptionsfromtaxation.Section19(1)oftheActrequiresthatlandbeassessedatcurrentvalue,whichisdefinedtomean,inrelationtoland,“theamountofmoneythefeesimple,ifunencumbered,wouldrealizeifsoldatarm'slengthbyawillingsellertoawillingbuyer.”Marinasareincludedinthedefinitionof“land,”whichisdefinedintheActtoencompassnotonlybuildingsandstructuresplacedupon,in,over,underandaffixedtolandbutalsolandcoveredwithwater.
TheMinisterofFinancefiledOntarioRegulation430/15onDecember18,2015,whichaddedadditionalrulesaffectingthevaluationandclassificationofpropertiesonwhichathird-partysign(billboard)islocated.Tocomplywiththeregulation,theincomeattributabletoathird-partysignwillnotbeincludedinthevaluationofanypropertyforassessmentpurposes.
1.3Classification
MPAC’sroleistoaccuratelyassessandclassifyallpropertiesinOntarioinaccordancewiththeAssessmentActandregulationsestablishedbytheGovernmentofOntario.
1AssessmentAct,R.S.O1990,cA.31:https://www.ontario.ca/laws/statute/90a31.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 6
MarinasareincludedintheCommercialPropertyClassinaccordancewithSection5(1)1ofOntarioRegulation282/98,whichincludes“landandvacantlandthatisnotincludedinanyotherpropertyclass.”2Amarinapropertycouldhavevarioustaxandunitclassesdependingupontheownershipandoccupancyoftheland.
Ifaportionofthepropertyisusedforotherpurposes,itmaybenecessarytovaluethosecomponentsseparatelyandsumthecomponentvaluestoachievethecorrecttotalcurrentvalue.Itmayalsobenecessarytoapportionthetotalvalueofthepropertybetweenthevarioususestoensurethattheappropriatetaxrateisappliedtotherelevantpartsoftheproperty.
1.4TheUseofThisMethodologyGuide
ThisMethodologyGuideisintendedto:
• EnsureMPAC’sassessedvaluesforthesepropertiesarefair,accurate,predictableandtransparent.
• Providedirectiontoassessorsandclearexplanationstomunicipalities,taxpayersandAssessmentReviewBoardmembers.
• EnsurethatMPAC’smethodologyforvaluingthesepropertiesiswelldocumentedandalignswithindustrystandards.
• Explainthethoughtprocess/decision-makingprocessthatanassessorshouldundertaketoapplythevaluationmethodology.
• Ensureaconsistentapproachtovaluingthesepropertytypes.
• SupportMPACassessorsinconductingtheirduediligencein:
Ø applyingOntario’slegislationandregulationsØ adheringtoindustrystandardsformarketvaluationinamassappraisal
environment
ItshouldbenotedthatthisMethodologyGuideisnotintendedtobeasubstituteforanassessor’sjudgmentinarrivingatamarketvalue–basedassessment(i.e.,currentvalue)foraparticularproperty.However,giventhattheMethodologyGuideexplainsindustrystandardsforpropertyassessment,conformstovaluationindustrynorms,andadherestoprovinciallegislationandregulation,MPACassessorsareexpectedtofollowtheproceduresintheMethodologyGuideandbeabletoclearlyandsatisfactorilyjustifyanydeviationsfromit. 2OntarioRegulation282/98,GENERAL:https://www.ontario.ca/laws/regulation/980282.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 7
1.5ConsultationandDisclosure
MPACiscommittedtoprovidingmunicipalities,taxpayersandallitsstakeholderswiththebestpossibleservicethroughtransparency,predictabilityandaccuracy.Insupportofthiscommitment,MPAChasdefinedthreelevelsofdisclosureaspartofitsdeliveryofthe2016province-wideAssessmentUpdate.
• Level1–MethodologyGuidesexplaininghowMPACapproachedthevaluationofparticulartypesofproperty
• Level2–MarketValuationReportsexplaininghowthemethodologyoutlinedinLevel1hasbeenappliedatthesectorlevelforthepurposesofeachassessment
• Level3–PropertySpecificValuationInformationavailabletopropertytaxpayers,theirrepresentativesandmunicipalities
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 8
2.0TheValuationProcess
Thevaluationprocessalwaysbeginswithadeterminationofthehighestandbestuseofthesubjectproperty.
Anyrelianceuponthisguideismadeonlyaftertheassessorhasdeterminedthatthehighestandbestuseofthesubjectpropertyisthatofamarina.
Assessorsdeterminethevalueofapropertyusingoneofthreedifferentapproachestovalue:
• thedirect(sales)comparisonapproach
• theincomeapproach
• thecostapproach
2.1Outline
Inthedirect(sales)comparisonapproach,valueisindicatedbyrecentsalesofcomparablepropertiesinthemarket.Inconsideringanysalesevidence,itiscriticaltoensurethatthepropertysoldhasasimilaroridenticalhighestandbestuseasthepropertytobevalued.
Intheincomeapproach(or,moreaccurately,theincomecapitalizationapproach),valueisindicatedbyaproperty’srevenue-earningpower,basedonthecapitalizationofincome.Thismethodrequiresadetailedanalysisofbothincomeandexpenditure,bothforthepropertybeingvaluedandothersimilarpropertiesthatmayhavebeensold,inordertoascertaintheanticipatedrevenueandexpenses,alongwiththerelevantcapitalizationrate.
Inthecostapproach,valueisestimatedasthecurrentcostofreproducingorreplacingimprovementsoftheland(includingbuildings,structuresandothertaxablecomponents),lessanylossinvalueresultingfromdepreciation.Themarketvalueofthelandisthenadded.
MPACusesthecostapproachtovaluemarinas.Thisapproachseparatelyvaluesimprovementsandlandtoproduceacurrentvaluefortheproperty.
Thecostapproachformarinapropertiesrequiresthefollowingstepstovaluethemarinabuilding(s):
1. Determinereplacementcostnew(RCN)ofmarinabuildingimprovements.
2. Determinephysicaldepreciation.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 9
3. Determinefunctionalobsolescence.
4. Determineexternalobsolescence.
5. Determinenetimprovementvalue.
Thefollowingstepsdeterminethevalueofthemarinasiteimprovements:
1. DetermineRCN.
2. Determinephysicaldepreciation.
3. Determinefunctionalobsolescence.
4. Determineexternalobsolescence.
5. Determinenetimprovementvalue.
Theassessorconsidersthelandvalueasfollows:
1. Determinethelandvalueformarinaland.
2. Addvaluesforotherpurposes(e.g.,excessland).
3. Determinecurrentvalueassessment.
2.2Approach
TherearethreemainphasesinthevaluationprocessusedbyMPAC:
• datacollection
• analysisofthedatacollected
• valuation
2.3DataCollection
Thedatarequiredformarinavaluationscomefromanumberofsources:
• MPACconductsperiodicinspectionsofmarinas.
• MPACalsocollectsinformationaboutsalesandtransfersofmarinas.
• Thereareanumberofguidesandotherpublishedinformationaboutmarinas.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 10
MPACgenerallycollectsthefollowingtypesofdataformarinas:
• generaldata
• financialdata
• propertydescription
• salesdata
• grossleasablearea(GLA)
• boatslipandstoragerentalrevenue(regularandseasonal)
• boatingservices,repairsandsupplies,fuel,foodrevenue
• otherincome
• operatingcosts(administration,utilities,propertymaintenance,etc.)
Marinalandiscategorizedaccordingtothefollowinguses:
• tableland/upland
• waterlots/submergedlandusable
• waterlots/submergedlandunusable
• vacant/excessland
• conservationland
• residentialsite
Marinasiteimprovementsmayinclude:
• breakwaters/piers
• jetties
• boatslips
• boatstorage(indoororoutdoor)
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 11
• fuelfacilities
• watersupply(municipalorother)
• sewagedisposalsystem
• pumpout
• otherrecreationalfacilities
Marinastructuresmayinclude:
• marinaoffice
• boatservicefacilities
• boatsupplyfacility
• foodoutlets/restaurant
• retailoutlets
• washrooms
• laundryfacility
• lockers
• storagesheds
Confidentiality
Asoutlinedabove,itisimportanttobeawarethat,inordertoenableMPACtoproduceanaccuratevaluationofthepropertyconcerned,informationneedstobeobtainedfromavarietyofsources.
ThiswillincludeinformationfromMPAC’srecords,fromtheowneroroperatoroftheproperty,fromthemunicipalityinwhichthepropertyislocated,fromtheassessor’svisittotheproperty,andfromothersources.
AllstakeholdersinthepropertytaxsystemhaveaninterestinensuringthatthecurrentvalueprovidedbyMPACiscorrect;inordertoachievethis,itisnecessaryforallpartiestocooperateintheprovisionofinformation.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 12
Itisappreciatedthatsomeoftheinformationoutlinedabovemaybeofacommerciallysensitivenature.MPACrecognizestheneedtoensurethatanyinformationprovidedtoitisproperlysafeguardedandonlyusedforthepurposeforwhichitissupplied.Assessorsmustappreciatethenatureofthisundertakingandensuredataistreatedaccordingly.
If,afteranappealhasbeenfiled,MPACreceivesarequestforthereleaseofactualincomeandexpenseinformation,orothersensitivecommercialproprietaryinformation,theusualpracticeistorequirethepersonseekingtheinformationtobringamotionbeforetheAssessmentReviewBoard(ARB),withnoticetothethirdparties,requestingthattheARBorderproductionoftherequestedinformation.ThereleaseofsuchinformationisatthediscretionoftheARBandcommonlyaccompaniedbyarequirementforconfidentiality.
TheAssessmentActoutlinesinsection53(2)thatdisclosedinformationmaybereleasedinlimitedcircumstances“(a)totheassessmentcorporationoranyauthorizedemployeeofthecorporation;or(b)byanypersonbeingexaminedasawitnessinanassessmentappealorinaproceedingincourtinvolvinganassessmentmatter.”
2.4DataAnalysis
Havingcarriedoutthedatacollectionoutlinedpreviously,theassessorneedstoanalyzeitandreachaconclusionregardingtheappropriatevaluationmethodtouseandhowitshouldbeapplied.
Asalreadyindicated,forthepurposesofthisMethodologyGuide,itisassumedthattheassessorwillconcludethatthereisinsufficientevidenceavailabletoenableeitherthedirectcomparisonapproachorincomeapproachtobeadopted.Forthatreason,theassessorwillbeadoptingthecostapproachandusingthedatacollectedtoensurethatthecostapproachisproperlyapplied.
2.5Valuation
Havingundertakenthenecessarystepsoutlinedabove,theassessorshouldnowbeinapositiontoapplytheappropriatevaluationmodel.
2.6ValidatingtheResults
Oncetheassessorhascompletedthevaluation,itisnecessarytocarryoutaseriesofcheckstoensurethatallrelevantpartsofthepropertyhavebeenincludedinthevaluation,therehasbeennodouble-countingofanyadjustmentsmadefordepreciation,theresultingvaluationhasbeencomparedwithanymarketevidencethatmaybeavailableinrelationtosimilarproperties,andthefinalvaluationisinlinewiththevaluationofothersimilarpropertiesinOntario.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 13
3.0TheValuation
3.1CostApproachOverview
Thetheorybehindthecostapproachtovaluefollowstheprincipleofsubstitution:thevalueofapropertyisequaltotheamountitwouldcosttoreplaceitwithasubstituteofequalutility.
Therearetwoprincipletasksinestimatingmarketvalueusingthecostapproach:valuethelandandvaluetheimprovements.
ValuetheLand
Landvalueisusuallyestablishedthroughanalysisofcomparablemarketsalesdata.
ValuetheImprovements
Avaluationofimprovementsincludesthefollowingsteps:
1. Collectthephysicalanddescriptivedataaboutthemarinasite.Inspectthebuildingsandotherimprovements,quantifyareas,noteconditionsandanalyzetheirutility.
2. Quantifythebuildingareasfromplansandlayouts,or,ifnecessary,duringthepropertyinspection.
3. UsingMPAC’sautomatedcostsystem(ACS),estimatethecostnewoftheassessableimprovementsasofthevaluationdate.
4. Deductfromcostnewvalueanamountreflectingallformsofdepreciation,whichmayincludephysical(age-lifedepreciation),functionalobsolescence(curableorincurable)andexternalobsolescence(economicand/orlocationalobsolescence).
Theresultingvaluewillbeanestimateofthecontributionoftheimprovementstothemarketvalueofthesubject,depreciatedforallcauses.
FinalValue
Thesumoflandvalueplusimprovementvalueistheestimatedmarketvalueoftherealestateatthesubjectlocation.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 14
3.2LandValuation
Thevaluationofmostmarinaswillincludetheconsiderationofthefollowingtypesofland:
• waterfront
• tableland/upland
• submergedlandorwaterlots
• landthatmaybesubjecttorestrictionsonuse
Waterfrontvaluationmethodsinclude:
• direct(sales)comparisonapproach
• incomeapproach
Whereverpossible,thedirectcomparisonapproach(basedonactualsalesoflandformarinas)willbeutilizedindetermininglandvalues.Iftherearenosalesoflandformarinasinthevicinitytheassessorwillhavereferencetoothersalesoflandandmaketheappropriateadjustmentstoaccountforanydifferencesbetweenthesoldpropertiesandthesubjectproperties.
Ifthewaterfrontlandisleased,theincomeapproachmaybeusedifthereissufficientmarketdataavailableforanalysis
AnexampleofhowthevalueoflandisincorporatedinthevaluationofamarinaonthecostapproachisshowninAppendix1.
3.3MarinaSiteImprovements
Varioussiteimprovementsareessentialtothefunctioningofamarina.Theymayinclude:
• breakwaters/piers
• jetties
• boatslips
• boatstorage(outside)
• fuelfacilities
• water supply (municipal or other)
• sewage disposal system
• pump out
• water facility
• other recreational facilities
An example of the way in which site improvements are included in a valuation on the cost approach is shown in Figure 3.3.
Figure 3.3 – Marina Site Improvements
Use Year Built RCN Good Depreciation RCNLD
Jetty Type 1- South Side 1 1990 $141,729 50% $70,865 $70,865
Jetty Type 1 - South Side 2 1990 $35,432 50% $17,716 $17,716
Jetty Type 1 - South Side 3 1990 $35,432 50% $17,716 $17,716
Jetty Type 1 - South Side 4 1990 $35,432 50% $17,716 $17,716
Jetty Type 1 - North Side 1 1990 $35,432 50% $17,716 $17,716
Jetty Type 1 - North Side 2 1990 $35,432 50% $17,716 $17,716
Jetty Type 2 - A Dock 1990 $294,771 50% $147,386 $147,386
Jetty Type 2 - B Dock 1990 $372,792 50% $186,396 $186,396
Jetty Type 2 - C Dock 1990 $464,505 50% $232,253 $232,253
Jetty Type 2 - D Dock 1990 $228,733 50% $114,367 $114,367
Pumping Dock 1990 $31,898 50% $15,949 $15,949
Boardwalk 1 1990 $18,885 50% $9,443 $9,443
Boardwalk 2 1990 $89,347 50% $44,674 $44,674
Light House 1970 $46,902 50% $23,451 $23,451
Totals: $1,866,706 $933,361 $933,361
© Municipal Property Assessment Corporation 2016 All rights reserved 15
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 16
3.4EstablishingCostNew
Threeapproachescanbeusedtoestablishcostnew:
• historicalconstructioncost–usefulforrelativelynewmarinas(5to10years)
• reproductioncost–usedmoreofteninanalyzingunusualand/orspecialpurposebuildingimprovements
• replacementcost–appliedintheanalysisoftypicalbuildingimprovementsandmarinaimprovements
Dependingonthefunctionalutilityofthemarina,MPAC’sassessorwillselectthemostrelevantoptionforthesubjectproperty.
AsshowninFigure3.5,typicalbuildingimprovementsatamarinainclude:
• marinaoffice
• boatservicefacilities
• boatsupplyfacility
• food/restaurant
• retailoutlets
• washrooms
• laundryfacility
• lockers
• storagesheds
Figure3.5alsoprovidesanillustrationofhowreplacementcostnew(RCN)iscalculatedforthevarioussiteimprovementsatamarina.
3.5DeductingDepreciation/Obsolescence
Depreciationmayincludephysicaldeteriorationduetoage,conditionand/oruseoftheproperty.Depreciationmayalsoincludeobsolescence.
Obsolescencereflectstheabnormaldepreciationthatarisesinsomepropertiesduetofunctionaland/orexternallygeneratedeconomicproblems.
Functional obsolescence can be the result of numerous factors, including poor or outdated designs, inadequate areas, excess operating costs, etc. Obsolescence is not related to the age of the property but to its ability to adequately perform its intended functions.
To determine whether obsolescence exists in a property, ask the question: “Could the existing facility be replaced with a more modern, efficient substitute, and if so, what would constitute this modern facility?”
Knowledge of current trends and building designs for marinas are important in recognizing obsolescence. Functional obsolescence can usually be recognized through poor design and lay-out, poor or inferior construction and the existence of excess operating costs.
External obsolescence is the result of a change of circumstances outside the control of the marina owner. This could be a large-scale factor such as economic recession or a more localized factor such as a new marina being constructed nearby that takes away some of the business from the marina being valued.
There are a variety of methods that can be used to quantify depreciation. However, while it is important to quantify all aspects of depreciation, it is equally important not to double count for the same aspect of depreciation while using the various approaches.
After the amount and degree of depreciation have been determined and quantified (if any), the end result should reflect the replacement cost new of the building improvements less any depreciation (RCNLD) found in the improvements.
Figure 3.5 – Value of Building Improvements at Marina
Building use Height(ft.) Area(sf) Year Built Cost/sf RCN % Good RCNLD
Assembly hall/lounge 12 4791 1920 $99.82 $478,238 20% $95,647
STG-1 Storage Shed 8 1151 1975 $20.88 $24,033 35% $8,411
STG-2 Storage Shed 8 800 1975 $26.95 $21,560 35% $7,546
STG-3 Storage Shed 8 800 1975 $26.95 $21,560 35% $7,546
STG-4 Boat Storage 12 1051 1975 $26.72 $28,083 35% $9,829
STG-4 Boat Storage 12 1000 1920 $22.69 $22,690 20% $4,538
STG-6 Crane House 12 1080 1975 $24.48 $26,438 35% $9,253
Totals 10,673 $622,602 $142,77
© Municipal Property Assessment Corporation 2016 All rights reserved 17
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 18
3.6MarketValueConclusion
Addingthevalueofthelandtothevalueofthebuildingandsiteimprovementsproducesthemarketvalueofthepropertybasedonthecostapproachanalysis.
3.7CurrentValueAssessments
Thefinalstepintheprocessistoconsolidateacurrentvalueassessmentfortheproperty.Oncethedeterminationofvaluehasbeencompletedusingthecostapproach,theassessorwillconsiderwhetherthereisanyothervalueintherealestatethathasnotbeencaptured,oranyotheradjustmentthatmayberequired.Anexampleofsuchafactormaybeexcessland.
ExcessLand
Excesslandislandthatissurplustocurrentneeds.Thevalueofexcesslanddependsonitslocationwithinthesiteandhowwellitsuitsfuturedevelopments.Suchsurpluslandisvaluedseparatelyandaddedtothecurrentvalueassessmentarrivedatforthemarina.
Beforearrivingatanexcesslandconclusion,asiteinspectionisrequiredtoensurethatadditionaldevelopmentwouldbepossible.Thedeterminationofexcesslandinvolvesareviewofcurrentzoningbylawsaswellasthecurrentcoverageandconfigurationoftheproperty.Theratetobeappliedtovalueexcesslandistypicallyderivedusingmarketsalesstudiesofvacantlandsites.
Asimplifiedexampleofamarinavaluation,usingthevaluesderivedforsiteandbuildingimprovementsalreadycalculatedinthisguide,isshowninAppendix1.
3.8Conclusion
ThisguidesetsouthowMPACassessorsapproachthevaluationofmarinasforpropertyassessmentpurposes.
Althoughitoutlinesthegeneralapproachadopted,itdoesnotreplacetheassessor’sjudgmentandtheremaybesomecaseswheretheassessoradoptsadifferentapproachforjustifiablereasons.
ForfurtherinformationaboutMPAC’srole,pleasevisitmpac.ca.
©MunicipalPropertyAssessmentCorporation2016Allrightsreserved 19
AppendixA:SampleValuation–Marina
RollNumber AddressMarinaNameAssessedOwner
LANDRATEUSED %Adjustment Acres Rate/Acre ValueCommercialLandValuePerAcreCommercialLandValuePerSqFt
$1,524,600$35
LOTSIZEANDUSEUnitofMeasure AcresParkLand 0.00MarinaLand 10.02MarinaUseWaterlot 11.25Waterlotnotusable 0.00LANDVALUECALCULATIONSLandValueParklandLandValueMarina
$1,524,600 x 50% x Acres 0$1,524,600 x 50% x Acres 10.02
$762,300$762,300
/ac/ac
==
$0$7,638,246
CommercialLandValueisreducedby50%toarriveat"ProvincialRecreationLandValue"fortheabovecalculation WATERLOTVALUECALCULATION
$1,524,600 x 50%"ProvincialRecreationLandValue"isreducedby50%toarrive
x Acres 11.25 xat"WaterLotAreasleasedtoyachtclubs/marinas"
50%
$381,150 /ac =
$4,287,938
WATERLOTVALUENOTUSABLECALCULATION$1,524,600 x 50% x Acres 0 x 50% x 20% = $0
"Notusablewaterlot"valueis20%ofusablewaterlotvalue TOTALLANDVALUE
$11,926,184SITE IMPROVEMENTSYardWork $933,361StructureRCNLD $498,084TOTALASSESSMENTCVA $13,357,629AsAssessed $13,357,629
top related