Assembled Workforce an Important Consideration in Property Valuation: The Appraisal Journal
October 7, 2020 08:00 AM
CHICAGO (Oct. 7, 2020) – Separating the value of a trained workforce from the overall value of a going concern requires economic analysis, not just the subtraction of employee salaries, according to an article published this week in The Appraisal Journal.
The Appraisal Journal is the quarterly technical and academic publication of the Appraisal Institute, the nation’s largest professional association of real estate appraisers. The materials presented in the publication represent the opinions and views of the authors and not necessarily those of the Appraisal Institute.
Many facilities and businesses—such as nursing homes, hotels, and correctional facilities—have a trained workforce that contributes value to the real property going concern. “Perspectives on the Assembled Workforce in Real Property Valuation,” by Kimberly K. Merriman, Ph.D., and Leonard J. Patcella, MAI, describes when appraisers may need to remove workforce value from the overall value for federal business tax and local property tax purposes, and it offers approaches for measuring and extracting the value of an assembled workforce.
“Is the Eiffel Tower Worth More Than the Statue of Liberty? Techniques for Determining the Value of Iconic National Landmarks – Part II,” by Richard J. Roddewig, JD, MAI, Anne S. Baxendale and J. Andrew Stables, is the second in a two-part series on the valuation of iconic national landmarks. It analyzes the land value of each landmark site and presents tools for estimating the impact of additional sources of revenue that might be generated under private ownership.
“Timing Is Everything: The Role of Interim Use in the Highest and Best Use Conclusion,” by David C. Lennhoff, MAI, SRA, AI-GRS, and Richard L. Parli, MAI, proposes the formal incorporation of the concept of “interim use” into the definition of “highest and best use.” The authors propose that interim use is a property characteristic that must be considered when a use is delayed.
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The Appraisal Institute is a global professional association of real estate appraisers, with over 17,000 professionals in almost 50 countries throughout the world. Its mission is to advance professionalism and ethics, global standards, methodologies, and practices through the professional development of property economics worldwide. Organized in 1932, the Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Individuals of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA, SRA, AI-GRS and AI-RRS designations. Learn more at www.appraisalinstitute.org.