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Highest and Best Use Analysis Key to Retail Valuation: The Appraisal Journal

October 16, 2018 08:00 AM

CHICAGO (Oct. 16, 2018) – The highest and best use analysis should dictate the methods and approaches applied in valuation analysis, according to a study 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.

“Highest and Best Use and Property Rights—Does It Make a Difference?” by Stephen F. Fanning, MAI, AI-GRS; Larry T. Wright, MAI, SRA, AI-GRS; and Rick J. Muenks, JD, MAI, uses a big-box retail property as an example to demonstrate that the highest and best use process is the basis for retail property valuation, and this analysis is the same regardless of which property rights school of thought is utilized and regardless of whether there is a vacant or occupied assumption.

Read “Highest and Best Use and Property Rights—Does It Make a Difference?” in the Summer 2018 issue of The Appraisal Journal.

Also in The Appraisal Journal’s Summer 2018 issue:

“Land Value Differentials Resulting from Variability between the Sales Comparison and Income Approaches in Timberland Valuation,” by Austin B. Harris, Christopher N. Singleton, MAI, and Thomas J. Straka, Ph.D., uses actual data to evaluate the various parameters used in timberland appraisal and to determine which factors account for variances in land value when different valuation methods are applied. The findings allow appraisers to better understand the importance of the factors in the adjustment process when valuing large timberland properties.

“Market Value: What Does It Really Mean?,” by Michael V. Sanders, MAI, SRA, explores the various definitions of the terms market value and fair market value and why this impacts valuations. The article offers suggestions that will help to clarify the term market value for future use.



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The Appraisal Institute is a global professional association of real estate appraisers, with more than 18,000 professionals in nearly 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




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