Extreme Appraising: Valuing CRE in a Down Market

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Notes

SEMINAR CONTENT: Given the possibility of declines in the value of CRE as a result of COVID-19, this seminar will address critical issues, often misunderstood even by experienced commercial appraisers, in valuing property in a declining market. The seminar will be based on a hypothetical case study property, a multi-tenant office building. The primary focus of the case study is to value the property “as is” and “when stabilized”, using all three valuation approaches, based on the following circumstances: 

1. The property is 50% vacant in a market experiencing 20% vacancy, thus necessitating the proper measurement of a rent-up adjustment to be incorporated in all three approaches to value the property “as is”.

2. The market is forecast to experience on-going, but temporary, external obsolescence based on a detailed fundamental market analysis, which will be demonstrated using current methodologies and also incorporated in valuations.. 

In addition, the case study property also incorporates two other issues that will need to be addressed in the valuations. 

1. One lease at the property was first negotiated when the market was much stronger. The rent for this lease was recently reduced and the term extended, in a so-called “blend and extend” renegotiation, but is still above market, therefore necessitating a “property rights adjustment”. 

2. Another lease includes an apparent higher than market rent due to substantial landlord provided concessions, therefore necessitating a measure of “effective rent” for purposes of forecasting the rent at the time of lease renewal.   

All of these issues will be discussed and then analyzed entirely in Excel, although attendees do not need to be an Excel expert to benefit from the seminar.

TIME: Check in 8:00 am Pacific Time/ Seminar 8:30 am to 4:30 pm

FORMAT: Registrants will connect using ZOOM interactive technology. For the full ZOOM experience, registrants will need a computer, Internet access, webcam, and a microphone. You do not need a paid account from ZOOM to participate. If you are using your IPad/Iphone/smartphone, please download the ZOOM app prior to the offering. A WEBCAM IS REQUIRED. The session monitor must be able to see each of the students and verify that they are participating at all times throughout the seminar. If you do not have a camera on your computer, they are available at BestBuy and other online retailers starting at around $30.

SEMINAR PRESENTER: Gary DeWeese, MAI

PHOTO VERIFICATION: As part of the required attendance monitoring, all students need to provide the Chapter Office with a copy of your driver's license in advance of the offering. Simply take a picture of your driver's license, scan it, and email a copy to patti@sdcai.org. Registrants who do not forward their photo ID to the Chapter Office will be ineligible for credit and will be prohibited from attending the seminar.

Cancellation Policy

Up to 15 days prior to program start date, a $50.00 cancellation fee will be applied to all requests for cancellation. Between two and 14 days prior to program start date, an $85 cancellation fee will be applied to all requests for cancellation. Less than two days prior to program start date, no refunds will be given.

Additional Information

CONTINUING EDUCATION CREDIT: This seminar is approved for 35 points of Appraisal Institute education credit, and for 7 hours of BREA continuing education credit (Approval No. 20CP754601431). Please note that not all states have approved virtual education; therefore, registrants must check their individual states for approval before registering for the program.

 

Disclaimer Information

ENROLLMENT: Enrollment is on a first-come, first served basis. If the event is filled, a waiting list will be retained. The San Diego Chapter reserves the rights to cancel, limit, or reschedule any event if the minimum enrollment level is not reached, and to change faculty assignments and facility locations at any time. Prospective students should confirm their registration with the Chapter office before making any non-refundable airline reservations. Transfers are not allowed.

PREREQUISITES: Some offerings have prerequisites. Be sure to read the course or seminar description to find out if there are any prerequisites for this offering.

REQUIRED EQUIPMENT: Some offerings require each student to bring a laptop and/or other equipment. Be sure to read the course or seminar description to determine if any equipment is required. Students are responsible for safeguarding their equipment and personal belongings at all times. The Appraisal Institute, the San Diego Chapter, the course or seminar Instructor, or the facility will not be responsible for any loss of students’ personal belongings.

National Disclaimer

This Educational Program was developed by an outside party. The Appraisal Institute Chapter made arrangements for the Third-Party to offer the Program with the intent of addressing topic(s) based on a certain chapter or local need for such topic, solely educational and informational purposes. The Appraisal Institute national organization was not involved in developing or organizing the Program and does not endorse the Program or its content.

The content of this Program, including but not limited to any written materials and presenter comments, does not represent the viewpoint of the Appraisal Institute (defined as including but not limited to, the national organization, its Regions, Chapters, members, candidates, affiliates and staff) unless formally adopted by the national Board of Directors. Further, the Appraisal Institute has not peer-reviewed or approved the content of the Program and does not warrant the accuracy or timeliness of the content of the Program. The Appraisal Institute does not publish examination review materials. The content of the Program is subject to court decisions and local, state and federal laws and regulations and any such revisions of such laws and regulations.

This Program is presented with the understanding that the Appraisal Institute is not engaged in rendering legal, accounting or other professional advice or services. Nothing in the Program is to be construed as the offering of such advice or services. If expert advice or services are required, attendees and readers are responsible for obtaining such advice or services from appropriate professionals.