features influencing value are also considered through the land description coding and unit price applied in assessing
<br />the subject's land component.
<br />(4) Quantity or size — the subject's size was considered based primarily on land and building areas or rental units as
<br />identified on the subject's PRC;
<br />(5) Cost and present replacement value — the PA indicates replacement costs are incorporated into the Cost/Market
<br />hybrid approach utilized in the CAMA system. The PAO did not develop a cost approach in the analysis;
<br />(6) Condition — the PAO considers the condition of the property through periodic site inspections;
<br />(7) Income — The PAO developed an income approach via direct capitalization method;
<br />(8) Net proceeds of sale — the PAO considers costs of sale through their application of a 15% downward adjustment to
<br />comparable sales indications. A specific 15% adjustment was not shown in the evidence presented.
<br />The PAO developed an income pro -forma analysis and a sales analysis. In the income pro -forma, the PAO used
<br />market rentals to estimate the potential gross income of the subject property. The rent comparable presented by the
<br />PAO show a brief detail of the room counts available, measured as the lowest and highest amount of bedrooms
<br />available in the apartment project and the lowest and highest rental rate. Moreover, the rental rates were surveyed
<br />during March of 2016, which is after the lien date. However, it does not show the specific rental rate of each apartment
<br />style. The PAO estimate of market rent for each apartment style is within the range of the subject rates reported by the
<br />Charles Wayne report. Reportedly, the subject property had a vacancy rate from 91% to 92%. The Charles Wayne rent
<br />comparable report shows the selected comparable and a range in occupancy rates from 91% to 100%, when measured
<br />in March of 2015. The PAO used a vacancy and collection loss of 6% or a 94% occupancy rate. The PAO also uses a
<br />7% ancillary income, which is within the range for class B and C apartments. However, the range provided is very
<br />wide; from 5.4% to 12.2% and no reasoning was provided to conclude by 7%. Selecting 5.4% or 12% would generate
<br />considerably different results. The PAO estimated a 40% operating expense ratio (OER) or $5,184 per unit, excluding
<br />real estate taxes. The PAO provided a group of class B expense comparable that shows a range in OER from 35.3% to
<br />56.5%. Expense comparable also shows a range in expense per unit from $3,626 to $5,090. The subject property has
<br />43 years of chronological age and is expected to be at the bottom of the range, due to its higher depreciation. The PAO
<br />used a capitalization rate of 6.25% and loaded it with the millage rate resulting in a loaded capitalization rate of
<br />7.98778%. The PAO deducted $1,046,879 to the capitalized value, resulting on a value opinion of $41,400,360 or
<br />$94,955 per unit.
<br />The PAO presented a grid with 16 sales, of which 6 are class B projects. These sales were built from 1986 to 2000,
<br />while the subject was built in 1973. The class B sales present a range in sales price of $73,372 to $98,669 per unit. The
<br />PAO gave more relevance to a group of 8 sales that are presented in bold letters, which includes class A, B and class B
<br />+ sales. According to the PAO, these sales show an average sales price of $99,376. However, class A sales are not
<br />similar to the subject and should not be considered. The PAO reconciled for $95,000 per apartment unit, resulting in
<br />$41,420,000.
<br />The Petitioner stated that in his opinion, the subject property is a class C apartment project. The Petitioner is of the
<br />opinion that the PAO did not considered the age, condition and functional deficiencies of the property. The petitioner
<br />reported that the property configuration is functional obsolete, causing the subject to have higher vacancy. The subject
<br />project has 194 apartment units are efficiency units, while more demand exists for 2 bed/2 bath units. The Petitioner
<br />reported the property is presenting deferred maintenance; requiring paint and the parking needs to be re -sealed and re -
<br />striped. Also, a profit and loss statement that collects information from 1/1/2016 to 8/31/2016 prepared in accrual basis
<br />was submitted as evidence. However, the lien date is January 1, 2016 and the financial information directly related to
<br />the 2016 tax year is from January 1, 2015 to December 31, 2015. The Petitioner presented his opinion of market value
<br />using a net operating income of $3,039,924.44 and a capitalization rate of 9.75% for a value opinion of $31,178,712,
<br />equivalent to $71,511 per apartment unit.
<br />The evidence presented by the PAO showed a range in sales price for class B apartments from $73,372 to $98,669 per
<br />apartment unit. The 2016 Market Value is $35,960,638, equivalent to $80,871 per apartment unit. Based on the
<br />evidence provided, it is the Special Magistrate opinion the subject property should be valued at $73,000 per unit or
<br />$31,828,000.
<br />After a review of the evidence and testimony presented at the hearing, it is the Special Magistrates opinion that the
<br />Property Appraiser lawfully considered the eight criteria enumerated in Section 193.011, Florida Statutes and,
<br />therefore did present sufficient evidence to establish a presumption of correctness. However, based upon the evidence
<br />and testimony presented at the hearing, the Petitioner did prove by a preponderance of the evidence that the Property
<br />Appraiser's just value does not represent just value. Based upon this evidence, the Property Appraiser's presumption of
<br />correctness is overcome. Therefore, the petition is GRANTED and the Special Magistrate recommends that the
<br />determination of the PAO be overcome.
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