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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. <br />-52- <br />