REAL ESTATE APPRAISAL SELF CONTAINED REPORT NAPLES CAMPGROUND 295 SEBAGO ...

125 Pages·2013·7.59 MB·English

by  Shelly R. Reilly

REAL ESTATE APPRAISAL
SELF CONTAINED REPORT
NAPLES CAMPGROUND
295 SEBAGO ROAD
NAPLES, MAINE 04055

Dates of Value
As Is - November 9, 2012
As Completed - May 1, 2014
As Stabilized - May 1, 2015

Date of Report
November 30, 2012

Client
Gail Sarrazin, AVP Credit Department Manager
Androscoggin Bank
SBA and Granite State Development
30 Lisbon Street
PO Box 1407
Lewiston, Maine 04243

Appraiser
Brian P. Diskin, #CG585
Maineland Consultants
30 Exchange Street
Portland, Maine 04101
M a i n e l a n d

C O N S U L T A N T S
REAL ESTATE APPRAISALS • FLOOD DETERMINATIONS

November 30, 2012

Gail Sarrazin
AVP, Credit Department Manager
Androscoggin Bank
SBA and Granite State Development
30 Lisbon Street
PO Box 1407
Lewiston, Maine 04234

Re: Real Estate Appraisal Self Contained Report
Naples Campground
295 Sebago Road
Naples, Maine 04055

Dear Ms. Sarrazin:

In accordance with your request, I, Brian P. Diskin, inspected the above captioned property for the
purpose of forming an opinion as to the as is, as completed and as stabilized market values as of
November 9, 2012, May 1, 2014 and May 1, 2015 respectively.

Note: this does not include map R5 Lot 23.

The subject is a 111-site seasonal campground with owner’s quarters all situated on 54.3 acres with a
proposed expansion of 45 sites to be fully operational in 2015. The subject is located in the rural and
shoreland zones per the town of Naples.

The analysis and conclusions within the attached self contained report are based upon field research,
interviews with market participants, and publicly available data collected by the appraiser. The
accompanying report has been prepared in accordance with the Uniform Standards of Professional
Appraisal Practice. Included is a summary description and analysis of the real estate, all pertinent data,
valuation methodology, supporting relevant exhibits, and addenda to the attached report.

It is our opinion that the as is, as completed and as stabilized market values for the subject’s fee simple
interest are as follows:

AS IS MARKET VALUE FOR REAL ESTATE ONLY-11/9/2012
$1,505,000
ONE MILLION FIVE HUNDRED FIVE THOUSAND DOLLARS

30 EXCHANGE STREET, PORTLAND, MAINE 04101 [phone] FAX [phone]
WWW.MAINELANDCONSULTANTS.COM

TABLE OF CONTENTS

PART I - INTRODUCTION

SUMMARY OF SALIENT FACTS AND IMPORTANT CONCLUSIONS ................................................. 1
INTENDED USE/USER OF APPRAISAL ........................................................................................... 1, 3
DEFINITIONS ......................................................................................................................................... 5
SCOPE OF WORK ................................................................................................................................ 6
UNDERLYING ASSUMPTIONS AND LIMITING CONDITIONS ............................................................. 7
CONTAMINATED LAND AND HAZARDOUS SUBSTANCES ................................................................ 9

PART II - FACTUAL DATA

AREA ANALYSIS .................................................................................................................................. 10
NEIGHBORHOOD ANALYSIS ............................................................................................................. 29
PUBLIC AND PRIVATE LAND USE RESTRICTIONS ......................................................................... 30
PROPERTY DESCRIPTION ................................................................................................................ 31
HIGHEST & BEST USE ANALYSIS ..................................................................................................... 37
THE APPRAISAL PROCESS............................................................................................................... 39

PART III - ANALYSES AND CONCLUSIONS

INCOME CAPITALIZATION APPROACH ............................................................................................ 41
SALES COMPARISON APPROACH ................................................................................................... 58
FINAL RECONCILIATION.................................................................................................................... 66
CERTIFICATION ................................................................................................................................... 68

PART IV - APPENDIX

APPENDIX ........................................................................................................................................... 69
Legal Description ......................................................................................................................................
Zoning Excerpts ........................................................................................................................................
Property Exhibits .......................................................................................................................................
FF&E .........................................................................................................................................................
Income & Expense Data ...........................................................................................................................
Occupancy Report ....................................................................................................................................
Comparable Improved Sales Data Sheets ................................................................................................
Client Engagement Letter .........................................................................................................................
Appraiser Qualifications ............................................................................................................................
295 Sebago Road Naples, Maine -1-
SUMMARY OF SALIENT FACTS AND IMPORTANT CONCLUSIONS
Owner of Record: Crepeau Investments, 295 Sebago Road, Naples, Maine
04055

Location of Property: 295 Sebago Road, Naples, Maine 04055

Tax Map Reference: Map R5 Lot 22: Does not include Map R5 Lot 23

Intended Use/ User: The intended use of the appraisal is to assist the
client/intended users, Androscoggin Bank, SBA, Granite State
Development and/or affiliates, in underwriting purposes.

Values Appraised: As Is: Market value of the real estate with allocations to
goodwill and FF&E
Prospective as completed: Market value of the real estate
with allocations to goodwill and FF&E
Prospective as stabilized: Market value of the real estate with
allocations to goodwill and FF&E

Property Rights Appraised: Fee Simple Estate

Dates of Value: As is: November 9, 2012, the date of inspection
Prospective as completed: May 1, 2014, the date of
completion
Prospective as stabilized: May 1, 2015, the date of
stabilization

Date of Report: November 30, 2012

Market Conditions: Mixed market conditions

Zoning/Status: Rural Area; legally nonconforming

Site Description 54.3 acres

Flood Hazard: Zone C; none of the subject parcel is located in a SFHA per
FEMA Map #230050 0015 & 18 B, dated 4/01/82

Improvements: 111-site seasonal campground with camp office/store/owner’s
quarters, recreation hall, three bath houses, in-ground
swimming pool, recycling shed and supporting infrastructure;
Proposed 45 full service sites

Easements/Encroachments: Typical utility easements, which are not adverse. There are
no apparent encroachments.

Highest & Best Use: As If Vacant Land –recreational campground
As Improved – recreational campground
295 Sebago Road Naples, Maine -2-
Value Indicators:
As Is
Income Capitalization Approach $1,505,000
Sales Comparison Approach N/A
Cost Approach N/A

As Is Final Market Value Conclusion: $1,505,000

Prospective Upon Completion
Income Capitalization Approach $2,335,000
Sales Comparison Approach N/A
Cost Approach N/A

Prospective Upon Completion Market Value Conclusion: $2,335, 000

Prospective Upon Stabilization
Income Capitalization Approach $2,430,000
Sales Comparison Approach $2,615,000
Cost Approach N/A

Prospective Upon Stabilization Market Value Conclusion: $2,430,000

Extraordinary Assumptions
and/or Hypothetical Conditions: 1.) The subject is completed in a professional workman like
manner per plans and specifications;
2.) The subject receives approvals from all regulatory
agencies; and
3.) There is no significant change in the economy prior to the
completion of proposed improvements.

The user of this appraisal is cautioned, as with any
extraordinary assumption or hypothetical condition, if the
conditions to the appraisal are not met or they change, it
could have a direct impact on the values reported herein.

Market Time: 6 to 12 months

Exposure Time: 6 to 12 months
295 Sebago Road Naples, Maine -3-

Subject Property

Identification of the Real Estate
The subject is located at 295 Sebago Road in Naples, Maine. It is identified on the Town of Naples
assessor’s map as Map R5 Lot 22. The subject is a 111-site seasonal campground with camp
office/store/owner’s quarters, recreation hall, three bath houses, in-ground swimming pool, recycling
shed and supporting infrastructure. It is located between the Sebago Road and Trickey Pond. The site
is 54.2 acres with an estimated 450’ of road frontage. The subject is located in the Rural area, Limited
Residential District and Shoreland zone (250’ from water). The subject is considered legally non
conforming as it predates current zoning.

Purpose of the Appraisal
The purpose of the appraisal is to estimate the as is, prospective as completed and prospective upon
stabilization market values with allocations to FF&E, goodwill and real estate.

Intended Use/ User
The intended use of the appraisal is to assist the client/intended user, Androscoggin Bank, SBA and
Granite State Development and/or affiliates, in underwriting purposes.

Property Rights Appraised
The subject is an owner-occupied campground that is operated as a hospitality facility for transient
guests. The subject’s marketable rights are best characterized as fee simple, defined as: "Absolute
ownership unencumbered by any other interest or estate, subject only to limitations imposed by the
governmental powers of taxation, eminent domain, police power, and escheat." The Dictionary of Real Estate
Appraisal, 5th Edition at 78.
295 Sebago Road Naples, Maine -4-
Property/Sale History
The subject has operated as a seasonal and transient campground since its approval in 2003. It was
approved for 116 sites but was modified in 2007 for the relocation of the recreation hall thus 5 sites
were lost and now operates as 111 sites. The original campground consisted of 26.1 acres with 28.2
acres added in 2007. There has been a conceptual plan presented to the Naples Planning Board for an
additional ±143 sites but no approvals have been granted. A new conceptual plan is being developed
for 45 sites (Phase I). Designing and engineering is currently being undertaken and will be presented to
the regulatory agencies for approvals in 2013. Phase I will encompass ±14 acres. Phase I is
anticipated to be completed for the camping season in 2014. There will be an estimated ±14 acres
remaining for future expansion.

The subject predated current zoning. Zoning was approved in 2008. Campgrounds are not a permitted
use in the subject’s rural zone. The subject is legally non-conforming. Per Naples Planning Board
minutes (August and September 2008) the subject’s 2 parcels were combined prior to the enactment of
the current zoning thus the campground could expand onto the parcel purchased in 2007 (28.2 acres).
This grandfathered use allowing for future expansion provides the subject a competitive advantage that
other parcels in this same zone do not have.

The subject is not currently listed for sale or under any purchase and sales contract.

Easements/Encroachments
Typical utility easements are referenced in the deed, which is not adverse to marketability. No
encroachments were noted.

Tax Assessment Data for Map R5 Lot 22
Land: $ 440,532
Building: $ 392,181
Total: $ 832,713
Mil Rate 2012-2013: $ 12.30
Taxes: $10,242.37

The Town of Naples assessment ratio is reported at 100%. The assessment appears reasonable as
compared to similar properties within Naples. Assessed values are created using mass appraisal
technique. At a given point in time, a pricing system is developed using recent sales data. This system
is used to price all property in the community. The value herein (as is) is higher than the assessment
due to the assessment relying strictly on the cost approach and no other valuation scenarios. It is also
likely that the land assessment does not fully consider the subject’s grandfathered use and/or
expansion potential.

Effective Dates of the Appraisal
The effective date of this appraisal for the as is value is November 9, 2012, the date of inspection. The
effective date of this appraisal for the prospective as completed value is May 1, 2014, the date of
completion. The effective date of this appraisal for the prospective as stabilized value is May 1, 2015,
the date of stabilization. The date of this report is November 30, 2012.

Exposure Period and Marketing Time
The value estimate contained in this report is based upon a 6- to 12-month exposure time prior to the
hypothetical consummation of a sale on the effective date of the appraisal. If properly priced and
marketed, the property would be expected to sell within a 6- to 12-month marketing period.
295 Sebago Road Naples, Maine -5-
DEFINITIONS
Market Value
Market value as defined in the Interagency Appraisal and Evaluation Guidelines (Federal Register,
Volume 75, No. 237, Page 77472) as:

The most probable price which a property should bring in a competitive and open market under all conditions
requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is
not affected by undue stimulus. Implicit in this definition are the consummation of a sale as of a specified date
and the passing of title from seller to buyer under conditions whereby:

$ Buyer and seller are typically motivated;
$ Both parties are well informed or well advised, and acting in what they consider their own best interests;
$ A reasonable time is allowed for exposure in the open market;
$ Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable
thereto; and
$ The price represents the normal consideration for the property sold unaffected by special or creative
financing or sales concessions granted by anyone associated with the sale.

Client
“The client may be an individual, group, or entity, and may engage and communicate with the appraiser directly
or through an agent.” Source: USPAP 2012-2013 Edition

Going-Concern Value
1.) AThe market value of all the tangible and intangible assets of an established and operating business
with an indefinite life, as if sold in aggregate; more accurately termed the market value of the going
concern.
2.) The value of an operating business enterprise. Goodwill may be separately measured but is an integral
component of going-concern value when it exists and is recognizable.@

Dictionary of Real Estate Appraisal, 5th ed. at 88

Furniture, Fixtures, and Equipment (FF&E)
“Business trade fixtures and personal property, exclusive of inventory.” Dictionary of Real Estate Appraisal, 5th
ed. at 85

Marketing Time
“An opinion of the amount of time it might take to sell a real or personal property interest at the concluded market
value level during the period immediately after the effective date of an appraisal. Marketing differs from
exposure time, which is always presumed to precede the effective date of an appraisal.” Source: The Dictionary
of Real Estate Appraisal, 5th Edition at 121

Exposure Time
“Estimated length of time that the property interest being appraised would have been offered on the market prior
to the hypothetical consummation of a sale at market value on the effective date of the appraisal.” Source:
USPAP 2012-2013 Edition

Prospective Value
A forecast of value expected to occur at specified future date. A prospective value estimate is most frequently
utilized in connection with real estate projects that are proposed, under construction, under conversion to a new
use, or that have otherwise not achieved sellout or a stabilized level of long-term occupancy at the time the
appraisal report is written.
295 Sebago Road Naples, Maine -6-
SCOPE OF WORK
Prior to developing the appraisal, we identified with the client the intended use and intended user, and
the value (as is, prospective as completed and prospective as stabilized market values) to be
appraised. To complete this appraisal, we have made a number of independent investigations and
analyses. We have relied upon data collected in the marketplace from sources deemed to be reliable
and on data in our office files on sales and other transactions in Maine over long periods of time. Our
comprehensive database is periodically updated for use in all assignments. Listed below is a summary
of steps taken in this assignment.

Area and Neighborhood Analysis
We have consulted with town officials, local real estate brokers and fellow appraisers to ascertain
development patterns and trends for the subject's market area.

Property Description and Analysis
The Town of Naples assessment records, Code Enforcement Office, and Planning Department were
researched, as well as the FIRM flood hazard maps. The description of the property is based on
personal inspection along with the owners, Conrad and Pamela Crepeau. Building sizes are based
upon measurements in the field and owner’s information.

Sales Comparison Approach
Transfers of improved properties in Naples and competing areas were researched. An attempt was
made to contact buyers, sellers and real estate brokers involved in the conveyances to verify
transaction data and ensure that the sales were arm’s length. The subject is the type of property that is
most often purchased and operated by an owner user. Details of the sales are included in this report.
Several sales are available for analysis purposes.

Income Approach
The income and expense statements were reviewed with owners and compared to similar operations in
southern Maine. A stabilized income and expense are presented and valued via direct capitalization
technique.

Cost Approach
The subject is of mixed age and condition being constructed in varying stages. In estimating all forms
of depreciation makes the cost approach very subjective and unreliable. The cost approach was not
completed.

Final Reconciliation
The appropriate and applicable methods of estimating the subject's market value are analyzed and
reviewed.