Appraisal Report - Canal Properties 2019
A P P R A I S A L R E P O R T
ENCUMBERED FEE INTEREST
APN 777-490-024
WEST OF JEFFERSON STREET,
SOUTH OF AVENUE 52
LA QUINTA, CALIFORNIA
APPRAISED FOR
Rutan & Tucker, LLP
611 Anton Boulevard, 14th Floor
Costa Mesa, California 92626
DATE OF VALUATION
March 29, 2019
DATE OF REPORT
April 11, 2019
APPRAISED BY
Anderson & Brabant, Inc.
353 West Ninth Avenue
Escondido, California 92025
File No. 19-015A
ANDERSON & BRABANT, INC.
REAL ESTATE APPRAISERS AND CONSULTANTS
353 W. NINTH AVENUE
ESCONDIDO, CALIFORNIA 92025-5032
TELEPHONE (760) 741-4146
FAX (760) 741-1049
April 11, 2019
William H. Ihrke, Esq.
Rutan & Tucker, LLP
611 Anton Blvd., Suite 1400
Costa Mesa, California 92628-1950
Dear Mr. Ihrke:
At your request and authorization, we have completed our appraisal of 6.0 acres of land, on the west side of
Jefferson Street, south of Avenue 52, in the City of La Quinta, California. A portion of the Coachella Canal
runs through the property in an east/west direction. The canal improvements are considered to be the
property of the United States, but are being operated and managed by the Coachella Valley Water District.
The right to construct the canal was granted by an easement right of way in favor of the United States that
recorded in 1910. The subject of this appraisal is the underlying fee interest in the 6.0 acre parcel of land.
The objective of this appraisal is to provide an opinion of the fair market value of property as of March 29,
2019.
The following is recognized as an Appraisal Report under the Uniform Standards of Professional
Appraisal Practice (USPAP). As such, our report is intended to comply with the reporting requirements set
forth under Standards Rule 2-2(a) of USPAP. It has also been prepared in conformance with the Code of
Ethics and Standards of Professional Practice of the Appraisal Institute.
Based upon our investigation and analysis of relevant market data, it is our opinion that the fair market
value of the underlying fee interest in the subject property, as of March 29, 2019, is $12,600. The
valuation opinion is subject to the General and Special Assumptions and Limiting Conditions, and the
Certification contained herein.
Thank you for this opportunity to be of service and if we can be of further assistance in this matter, please
let us know.
Respectfully submitted,
ANDERSON & BRABANT, INC.
James Brabant, MAI
State Certification No. AG002100
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
TABLE OF CONTENTS
EXECUTIVE SUMMARY ......................................................................................................... 1
ASSUMPTIONS AND LIMITING CONDITIONS ................................................................. 2
APPRAISER'S CERTIFICATE ................................................................................................. 4
INTRODUCTION
Identification of the Property ................................................................................................... 5
Ownership ................................................................................................................................ 5
Purpose/Objective of the Appraisal Assignment ..................................................................... 5
Intended Use and User ............................................................................................................. 6
Property Rights Appraised ....................................................................................................... 6
Extraordinary Assumptions...................................................................................................... 6
Hypothetical Conditions .......................................................................................................... 6
Scope of Work ......................................................................................................................... 6
Report Option.............................................................................................................................7
Sales History of the Subject Property ........................................................................................7
Prior Appraisal Services ............................................................................................................7
Effective Date of Value Opinion ...............................................................................................7
Date of Report ............................................................................................................................7
Location Map .............................................................................................................................8
Location Description ..................................................................................................................9
DESCRIPTION OF THE APPRAISED PROPERTY
Aerial Photograph ....................................................................................................................11
Subject Property Photographs ..................................................................................................12
Plat Map ...................................................................................................................................15
Land Description ......................................................................................................................16
Improvement Description ........................................................................................................17
Assessment Data ......................................................................................................................17
VALUATION
Highest and Best Use ...............................................................................................................18
Methodology ............................................................................................................................18
Sales Comparison Approach ....................................................................................................19
Estimated Exposure Time ........................................................................................................23
ADDENDA
Photographs of Comparable Market Data
Market Data Map
Qualifications of the Appraiser
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 1
EXECUTIVE SUMMARY
Property Location: West side of Jefferson Street, south of Avenue 52, La Quinta,
California
Assessor’s Parcel Nos.: 777-490-024
Legal Description: The northerly 130 feet of the southeast quarter of Section 8,
Township 6 South, Range 7 East, San Bernardino Base and
Meridian.
Interest Appraised: Fee Interest (encumbered)
Owner of Record: See section titled “Ownership” on page 5.
Property Characteristics: Land Area: 6.0 acres (261,360 sq.ft.)
Zoning: FP (Floodplain District)
General Plan: OS (Open Space District)
Flood Zone: Not mapped.
Earthquake
Fault Zone: No
Toxic Hazard: None noted
Improvements: Open canal plus additional equipment, facilities and some
chain-link fencing.
Highest and Best Use: Continued use as a canal
Date of Valuation: March 29, 2019
Date of Report: April 11, 2019
Estimated
Exposure Time: Six months
Value Conclusion: $12,600
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 2
ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal is subject to the following special assumptions and limiting conditions:
1. This is an Appraisal Report, which is intended to comply with the reporting standards set
forth under the Uniform Standards of Professional Appraisal Practice for an Appraisal Report.
The report presents summary discussions of the data, reasoning and analyses that were used in
the appraisal process to develop the appraisers’ opinion of value. In some instances, supporting
documentation concerning data, reasoning, and analyses has been retained in the appraisers’ file.
The information contained in this report is specific to the needs of the client and for the intended
use stated in this report. The appraisers are not responsible for the unauthorized use of this
report.
2. Information pertaining to the subject property was obtained by aerial photographs, a
physical inspection, Assessor’s records, a preliminary title report and other public information
that we assume is correct.
This appraisal is subject to the following general assumptions and limiting conditions:
1. It is assumed that information furnished to us by our client, including maps, leases, and
legal descriptions is substantially correct.
2. No responsibility is assumed for matters legal in character, nor do we render an opinion as
to title, which is assumed to be held in fee simple interest as of the date of valuation unless
otherwise specified.
3. It is assumed that the property is readily marketable, free of all liens and encumbrances
except any specifically discussed herein, and under responsible ownership and management.
4. Photographs, plat and maps furnished in this appraisal are to assist the reader in visualizing
the property. No survey of the property has been provided, and no responsibility has been
assumed in this matter.
5. A title report has been provided for this appraisal assignment. We have assumed that there
are no undisclosed easements or restrictions affecting the property which would adversely impact
its value.
6. Soils engineering studies have not been provided to Anderson & Brabant, Inc. It is
therefore assumed that there are no hidden or unapparent conditions of the property such as
hazardous or toxic wastes and/or other subsoil conditions which would render it more or less
valuable. No responsibility is assumed for such conditions or for engineering which might be
required to discover such factors.
7. The appraisers are not qualified to detect hazardous waste and/or toxic materials. Any
comment by the appraisers that might suggest the possibility of the presence of such substances
should not be taken as confirmation of the presence of hazardous waste and/or toxic materials.
Such determination would require investigation by a qualified expert in the field of environmental
assessment. The presence of substances such as asbestos, urea-formaldehyde foam insulation, or
other potentially hazardous materials may affect the value of the properties. The appraisers’ value
estimates are predicated on the assumption that there is no such material on or in the properties that
would cause a loss in value unless otherwise stated in this report. No responsibility is assumed for
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 3
any environmental conditions, or for any expertise or engineering knowledge required to discover
them. The appraisers’ descriptions and resulting comments are the result of the routine
observations made during the appraisal process.
8. Possession of this report, or a copy thereof, does not carry with it the right of publication. It
may not be used for any purpose by any person other than the party to whom it is addressed
without the written consent of Anderson & Brabant, Inc., and in any event, only with proper
written qualification and only in its entirety.
9. Disclosure of the contents of this appraisal report is governed by the by-laws and regulations
of the Appraisal Institute. Neither all nor any part of the contents of this report (especially
reference to the Appraisal Institute or the MAI designation) shall be disseminated to the public
through advertising media, public relations media, news media, sales media, or any other public
means of communication without prior written consent and approval of Anderson & Brabant, Inc.
10. The submission of this report constitutes completion of the services authorized. It is
submitted on the condition that the client will provide the appraiser customary compensation
relating to any subsequent required depositions, conferences, additional preparation or testimony.
11. The valuation estimate is of surface rights only and the mineral rights, if any, have been
disregarded.
12. No warranty is made as to the seismic stability of the subject property.
13. It is assumed that all applicable zoning and land use regulations and restrictions have been
complied with, unless a nonconformity has been stated, defined, and considered in this appraisal
report.
14. It is assumed that all required licenses, certificates of occupancy, or other legislative or
administrative authority from any local, state, or national governmental or private entity or
organization have been or can be obtained or renewed for any use on which the value estimates
contained in this report are based.
15. It is assumed that the utilization of the land or improvements is within the boundaries or
property lines of the properties described and that there is no encroachment or trespass unless
otherwise stated in this report.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 4
APPRAISER’S CERTIFICATE
I do hereby certify that, to the best of my knowledge and belief …
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are limited only by the reported
assumptions and limiting conditions and are my personal, impartial, and unbiased
professional analyses, opinions, and conclusions.
3. I have no present or prospective interest in the property that is the subject of this report and
no personal interest with respect to the parties involved.
4. I have performed no services, as appraisers or in any other capacity, regarding the property
that is the subject of this report within the three (3) year period immediately preceding
acceptance of this assignment.
5. I have no bias with respect to the property that is the subject of this report or to the parties
involved with this assignment.
6. My engagement in this assignment was not contingent upon developing or reporting
predetermined results.
7. My compensation for completing this assignment is not contingent upon the developing or
reporting of a predetermined value or direction in value that favors the cause of the client,
the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a
subsequent event directly related to the intended use of this appraisal.
8. My analyses, opinions, and conclusions were developed, and this report has been prepared,
in conformity with the Uniform Standards of Professional Appraisal Practice.
9. James Brabant made an inspection of the property that is the subject of this report on March
1, 2019, accompanied by a representative of the City of La Quinta. A second inspection was
conducted on March 29, 2019.
10. Patricia L. Brabant Haskins provided significant real property appraisal assistance to the
person signing this certification. Market data research and verification and report
preparation.
11. The reported analyses, opinions, and conclusions were developed, and this report has been
prepared, in conformity with the Code of Professional Ethics and Standards of Professional
Appraisal Practice of the Appraisal Institute.
12. The use of this report is subject to the requirements of the Appraisal Institute relating to
review by its duly authorized representatives.
13. As of the date of this report, I have completed the continuing education program of the
Appraisal Institute.
_________________________________ April 11, 2019
James Brabant, MAI Date
State Certification No. AG002100
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 5
INTRODUCTION
IDENTIFICATION OF THE PROPERTY
The subject property is approximately 6.0 gross acres of land located along the west side
of Jefferson Street, south of Avenue 52 in the city of La Quinta, California. It may be identified
as Assessor’s Parcel Number 777-490-024. The Coachella Canal runs through the length of the
parcel.
Legal Description
A brief legal description of the subject property, from the Preliminary Report by Stewart
Title of California follows.
The northerly 130 feet of the southeast quarter of the northeast quarter
of Section 8, Township 6 South, Range 7 East, San Bernardino Base
and Meridian.
OWNERSHIP
The Preliminary Report prepared by Stewart Title of California, dated November 20,
2018, identifies two parcels, both of which are portions of Assessor’s Parcel No. 777-490-024.
Title to Parcel 1 is shown to be vested in Charles R. Rubey (1/2 interest) and A. Reed Rubey and
Mary H. Rubey, husband and wife (1/2 interest). Title to Parcel 2 is shown to be vested in Ross
H. Lee and Hazel H. Lee, husband and wife (1/2 interest); and Ross A. Lee and Loretta M. Lee,
husband and wife (1/2 interest).
PURPOSE/OBJECTIVE OF THE APPRAISAL
The purpose/objective of this appraisal is to provide an opinion of the fair market value
of the property. As used in this report, Fair Market Value is defined as follows:
“(a) The fair market value of the property taken is the highest price on the date of
valuation that would be agreed to by a seller, being willing to sell but under no
particular or urgent necessity for so doing, nor obliged to sell, and a buyer, being
ready, willing, and able to buy but under no particular necessity for so doing, each
dealing with the other with full knowledge of all the uses and purposes for which
the property is reasonably adaptable and available.
(b) The fair market value of property taken for which there is no relevant,
comparable market is its value on the date of valuation as determined by any
method of valuation that is just and equitable.” 1
The value estimate reflects a reasonable exposure time for the subject property estimated
at six months.
1 California Code of Civil Procedure, Title 7, Sec. 1263.320 and 1263.330
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 6
INTENDED USE AND USER
It is our understanding that the intended use of this report is to assist the client, Rutan &
Tucker, LLP, as the representative of the City of La Quinta, in anticipation of potential litigation
with any other entity or person that may claim an interest in the property.
PROPERTY RIGHTS APPRAISED
The property interest appraised is the underlying fee interest in APN 777-490-024. The
term “fee simple estate” is defined as follows in the 6th edition of The Dictionary of Real Estate
Appraisal, published by the Appraisal Institute:
“Absolute ownership unencumbered by any other interest or estate,
subject only to the limitations imposed by the governmental powers
of taxation, eminent domain, police power and escheat.”
The underlying ownership of the subject property is a fee interest, but it is not the “fee
simple estate,” as it is encumbered by a right of way for ditches or canals constructed by the
authority of the United States that was conveyed in 1910. This portion of the Coachella Canal,
which is a portion of the All American Canal, is maintained and operated by the Coachella
Valley Water District through an agreement with the Federal Government. The owner of the
underlying fee interest in the property does not receive any income from this encumbrance which
results in a substantial reduction in the bundle of rights for that ownership.
EXTRAORDINARY ASSUMPTIONS
An extraordinary assumption is defined as an assignment-specific assumption as of the
effective date of value regarding uncertain information used in an analysis which, if found to be
false, could alter the appraisers’ opinions or conclusions. No extraordinary assumptions have
been included in this analysis. However, the appraisal is subject to certain other special and
general assumptions as outlined on pages 2 and 3 of this report.
HYPOTHETICAL CONDITIONS
A hypothetical condition is defined as a condition, directly related to a specific
assignment, which is contrary to what is known by the appraiser to exist on the effective date of
the assignment results, but is used for the purpose of analysis. No hypothetical conditions have
been included in this report.
SCOPE OF WORK
In preparing this appraisal, we have completed the process itemized below.
· Discussed the project with the client.
· Set forth the purpose/objective of the appraisal assignment.
· The initial inspection of the subject property was on March 1, 2019, and I was
accompanied by a representative of the City of La Quinta. A subsequent
inspection was on March 29, 2019, which is the date of value.
· Reviewed various documents provided by representatives of the City of La Quinta.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 7
· Reviewed a Preliminary Title Report by Stewart Title of California, dated
November 20, 2018.
· Inspected the subject neighborhood.
· Set forth all assumptions and limiting conditions affecting the appraisal.
· Investigated and analyzed legal characteristics such as zoning and the general plan
land use designation.
· Estimated highest and best use of the subject property as vacant.
· After review of all available data and appropriate analyses, the applicable valuation
methodology was determined to be the Sales Comparison Approach. The Income
and Cost Approaches to value are not considered applicable in the valuation of
vacant land and were not utilized.
· Researched, inspected and verified details of appropriate market data selected for
analysis in the Sales Comparison Approach.
· Compared the chosen market data to the subject property for identified elements of
comparison making adjustments judged supportable in the open market.
· Arrived at value conclusions considering the stated definition of fair market value.
· Drafted the appraisal report in accordance with the Uniform Standards of
Professional Appraisal Practice (USPAP) and Appraisal Institute Standards.
REPORT OPTION
This is an Appraisal Report as defined by the Uniform Standards of Professional
Appraisal Practice (USPAP). It presents summary discussions of the data, reasoning and
analyses that were used in the appraisal process to develop the appraisers’ opinions of value.
SALES HISTORY OF THE SUBJECT PROPERTY
There are no known transactions involving the subject during the past five years. In
addition, we have no knowledge that it is currently being offered for sale.
PRIOR APPRAISAL SERVICES
We have performed no services, as an appraiser or in any other capacity, regarding the
property that is the subject of this report within the three-year period immediately preceding
acceptance of this assignment.
EFFECTIVE DATE OF VALUE OPINION
The date of value is March 29, 2019.
DATE OF REPORT
The date of the appraisal report is April 11, 2019.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 8
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
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LOCATION DESCRIPTION
Region and City Description
The subject is located within the City of La Quinta in the County of Riverside in the
southern part of the State of California. Riverside County encompasses approximately 7,310
square miles. It lies to the east of Orange County, north of San Diego and Imperial Counties,
and south of San Bernardino County. The Arizona border lies to the east of Riverside County.
The county is comprised of two distinct geographic/economic regions. The western portion of
the county is a semi-arid region with a diverse economic base while the eastern portion is
primarily desert with an economic base centered on tourism and agriculture. As of January 2018
the population of Riverside County was 2,415,955 residents.
Riverside County is served by many freeways including Interstates 10, 15 and 215; and
State Highways 60 and 91. These provide good access to major population centers throughout
the county, although traffic at peak hours is often congested. Interstate 10 is the major east-west
freeway between Los Angeles, San Bernardino and Riverside to the west and the Arizona border
and points beyond to the east. It traverses the Coachella Valley providing access to many cities.
State Highway 111, which connects to Interstate 10, provides access to Palm Springs.
The City of La Quinta is located within a regional sub-area identified as the "Coachella
Valley." The Coachella Valley is comprised of desert cities and communities including Palm
Springs, Palm Desert, Cathedral City, Rancho Mirage, Bermuda Dunes, Indio, Palm Desert,
Indian Wells, La Quinta, Desert Hot Springs, Thousand Palms and Coachella. This area is best
known as a winter resort area, catering to both Southern California and the entire country.
The economic base in the Coachella Valley is oriented to tourism and construction.
There are not a lot of large industrial employers and few provide a large number of jobs. The
nature of the industries in this area requires smaller operations and there are fewer jobs per
company than found in most areas of Southern California.
La Quinta incorporated on May 1, 1982 and has a Council-Manager form of government.
The population of La Quinta was estimated by the State of California Department of Finance, as
of January 1, 2018, to be 41,204 persons. This is an increase of approximately 1.5 percent over
the January 1, 2017 population of 40,605. La Quinta is located in the heart of the Coachella
Valley, at the base of the Santa Rosa Mountains bordered by Indian Wells and Palm Desert to the
west, Bermuda Dunes to the north, Indio to the northeast and Coachella to the east. The cities of
Cathedral City and Palm Springs are further to the west.
As with many cities in the Coachella Valley, La Quinta enjoys a reputation as a
destination resort, attracting affluent visitors as well as seasonal visitors (“snow birds”) that
travel to the region from areas all over the United States. La Quinta has over 20 golf courses and
is the home of the world famous PGA West, which annually hosts several prestigious events.
More specifically, the subject is located in the central portion of the City of La Quinta on
the west side of Jefferson Street, south of Avenue 52. Uses adjacent to the north and south of the
subject are part of the SilverRock Resort Specific Plan area. The Specific Plan allows for the
development of public golf courses, hotel resort facilities, and supporting commercial uses. Site
work has just begun on additions to SilverRock Resort that will include a spa and the upscale
Montage Hotel. The land to the south of the subject is currently vacant, while a portion of the
land to the north is vacant and a portion is part of the golf course. There are several golf course
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 10
resorts in the area with SilverRock Resort a short distance west and north of the subject,
Hideaway Golf Club east across Jefferson Street and The Citrus Club at La Quinta Resort
located a short distance north along the north side of Avenue 52. The Hideaway and Citrus Club
also include residential units. Other well-known and nearby golf courses include PGA West,
south of Avenue 54 and Tradition Golf Club at the south end of Washington Street, south of
Avenue 52. There is a new gated residential community known as Codorniz, located northeast
of the subject at the southeast corner of Jefferson Street and Avenue 52.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 11
Aerial View of the Subject Property
The approximate boundaries of the subject property are outlined in red.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 12
Photographs of the Subject Property
Looking westerly across Jefferson Street toward the subject property and canal.
Another view looking westerly toward the subject property and canal from Jefferson Street.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 13
Photographs of the Subject Property
Looking southerly along Jefferson Street toward the canal crossing.
Looking southerly toward intersection of Avenue 52 and SilverRock Way.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 14
Photographs of the Subject Property
Looking south along SilverRock Way toward the entrance road to SilverRock Resort.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
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PLAT MAP
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
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SUBJECT PROPERTY DESCRIPTION
LAND DESCRIPTION
Size and Shape
The property appraised is a long and narrow property consisting of one Assessor’s Parcel
with a gross area of 261,360 square feet or 6.0 acres. The parcel is approximately 130 feet wide
and rectangular in shape. A plat map delineating the property boundaries may be found on the
previous page.
Topography
The subject property is essentially level and near street grade. There is an open canal that
runs in an east-west direction the entire length of the property that is part of the Coachella Canal.
Flood Hazard
The Federal Emergency Management Agency (FEMA) has not completed a study to
determine flood hazard in the subject location; therefore, a flood map has not been published at
this time.
Soils
A soil report specifically for the subject property has not been provided for this appraisal.
It is assumed that soil conditions are adequate and that there is no adverse condition that would
interfere with allowed uses of the site.
Seismic Hazard
The subject property is not in an “Earthquake Fault Zone” as designated by the California
State Division of Mines and Geology. However, the property is located in an area prone to
seismic events, a condition that it shares with other properties located in the general Southern
California area.
Environmental/Toxic Conditions
A Phase I Environmental Study has not been provided for this appraisal. We have
assumed for purposes of our analysis that there are no environmental or toxic conditions that
impact the subject property.
Utilities
Public utilities are available in the immediate area.
Street Improvements/Access
The subject property has approximately 130 feet of frontage along Jefferson Street.
Jefferson Street is a publicly maintained thoroughfare with three traffic lanes and a bike lane in
each direction. Street improvements at the subject property include a landscaped median and
concrete curbs, gutters and sidewalks.
Easements and Encumbrances
We have reviewed a Preliminary Report prepared by Stewart Title of California, dated
November 20, 2018. The exceptions to coverage include an easement for the right of way for
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 17
ditches or canals that were constructed by the authority of the United States. The easement
document was dated July 14, 1910. This easement has an impact on the value of the subject
property that will be discussed in the valuation section of this report. Additional exceptions
include water and mineral rights.
Zoning/Community Plan
The property appraised is a portion of the Coachella Canal and is zoned FP Floodplain
District by the City of La Quinta. The purpose of this designation is to protect life and property
from flood flows and to establish criteria for land use consistent with state law and the Federal
Emergency Management Agency (FEMA). At the subject property, the Coachella Canal is an
open channel carrying water from the Colorado River via the All American Canal to Lake
Cahuilla.
The General Plan designation of the property is OS Open Space District. The stated
purpose of this designation is to provide for the protection and preservation of sensitive
environmental areas such as areas with significant cultural resources, threatened or endangered
plant and wildlife species habitat, scenic resources and significant topographical constraints.
The property is also identified as part of the public facilities in the SilverRock Resort
Specific Plan, and is designated as W (Water Course/Flood Control).
It is clear from the zoning and General Plan designations, as well as the use of the
property (transporting of water), that development of the property would not be allowed.
IMPROVEMENT DESCRIPTION
The Coachella Canal runs through the subject property in an east/west direction. At the
subject property, the canal is an open channel. Other improvements include equipment/facilities
relating to the channel and some chain-link fencing. The Coachella Canal was completed about
1949 and the improvements are considered to be the property of the United States, but are being
maintained and managed by the Coachella Valley Water District.
ASSESSMENT DATA
The subject property is not currently assessed. The tax rate for any given area reflects a
1.0 percent base to which is added voter approved assessments and any service/municipal fees
that may be applicable. Property taxes in the state of California are typically based upon transfer
value at the time of sale.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 18
VALUATION
HIGHEST AND BEST USE
Highest and Best Use is an important concept in real estate valuation as it represents the
premise upon which value is based. As used in this report, Highest and Best Use is defined as
follows.
“The reasonably probable and legal use of vacant land or an improved property that is
physically possible, appropriately supported, financially feasible, and that results in the
highest value. The four criteria the highest and best use must meet are legal
permissibility, physical possibility, financial feasibility, and maximum productivity.”2
The principle of highest and best use incorporates the concepts of most probable use and
most profitable use. It must be a use that is legally and physically possible as well as one that is
financially feasible and maximally productive.
Legally Permissible: The legal limitations on the use of the subject property are
regulated by the Floodplain District (FP) zoning and Open Space (OS) General Plan use
designations of the City of La Quinta. It is clear from these designations, as well as the easement
for ditches or canals for the transporting of water, that development of the property for other uses
would be very limited and would likely include only things like infrastructure for utilities and/or
road crossings. In addition, there does not appear to be a reasonable probability to anticipate a
change in zoning/general plan or the termination of the easement for the canal.
Physically Possible: The subject site is level and near street grade. Public services and
utilities are nearby and the site has good accessibility. However, the legal limitations discussed
above would appear to preclude the consideration of any substantial improvements except for
those related to the operation of the canal or additional utilities and/or road crossings.
Financially Feasible and Maximally Productive: The issue of economic viability
focuses primarily on supply and demand characteristics of the local marketplace and the
relationship between cost and potential value. Generally speaking, any proposed use that
supports a positive land value is considered financially feasible. The subject site is currently
being used as a canal for the transporting of water and that use is expected to continue in the
foreseeable future. In our opinion that reflects the most financially feasible and maximally
productive use of the site.
Conclusion: The existing canal use of the property is a legal use that is physically suitable
for the land and appears to be financially feasible and maximally productive. Therefore, we have
considered the canal use to reflect the highest and best use of the property.
METHODOLOGY
The appraisal process is an orderly procedure in which the data used to estimate value are
acquired, presented, classified, and analyzed. The preceding sections of this report provide a
description of the appraised property and an analysis of highest and best use. The following
sections include descriptions and analyses of the data and reasoning used in the valuation process
and our valuation conclusion.
2 The Appraisal of Real Estate, 14th ed. (Chicago: Appraisal Institute, 2013), p. 333
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 19
The three generally accepted methods of estimating Fair Market Value are the Cost
Approach, Sales Comparison Approach, and Income Approach. However, in this case, with the
underlying fee interest in the subject property being land only, the only applicable approach is
the Sales Comparison Approach. Neither the Cost Approach nor the Income Approach are
relevant in the valuation of the subject land.
SALES COMPARISON APPROACH
The Sales Comparison Approach relies on the concept that a prudent buyer would pay no
more for a property than it would cost to acquire a comparable substitute. Sales of similar
properties are compared directly to the subject to arrive at an indicated value. The reliability of
this valuation technique is dependent upon the availability of comparable sales data, the
verification of the data, the overall degree of comparability of the data, and the absence of non-
typical conditions affecting the sales prices.
We investigated the marketplace for sales of land that could be related to the subject
property on a direct comparison basis. Several data sources were investigated, including CoStar
Comps and the local multiple listing service, contacts with the Coachella Valley Water District,
local appraisers and brokers, as well as our own files. The search was for sales of limited-use
parcels of land that had little or no development potential in the Coachella Valley area. The
focus was on sales of flood plain parcels of vacant land. As a result of our investigation, we
selected six sales for the purpose of supporting a value for the subject. The data range in size from
2.74 acres to 338.59 acres, and closed escrow between August 2015 and June 2018. The unit of
comparison in the analysis is the price paid per gross acre of land.
A summary of the comparable data can be found on the following page. Following the
summary is a discussion of the comparable data, while aerial photographs of the data and a market
data map are included in the Addenda.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 20
Discussion of the Market Data
Comparable No. 1 is the October 2016 sale of a level, 3.88 acre site located about 22
miles to the northwest of the subject in Palm Springs on the east side of Gene Autry Trail, a
paved public roadway. The buyer of the land is the Coachella Valley Conservation Commission
that acquired the site for conservation purposes at a price of $15,500 or $3,995 per acre, all cash
to the seller. The parcel is entirely within a 100 year floodplain. The underlying zoning is OS
(Open Space), and the effective General Plan is Desert which allows a minimum parcel size of
ten acres.
Comparable No. 2 is large irregular piece of land consisting of level to undulating
topography covering approximately 338.59 total acres. It is located approximately 23 miles to
the northwest of the subject in Palm Springs along both sides of Gene Autry Trail. The site is
zoned W (Water Course) and O5 (Open Land) which aligns with the General Plan designations
of OS-C, OS-D and OS-W. The property is located within a 100-year floodplain and was
Comp No 1 2 3 4 5 6
Location
East side of
Gene Autry Trail
Palm Springs
East & west of
Gene Autry Trail
Palm Springs
S. of I-10, N. of portion
of Tipton Road that is
parallel to Highway 111,
W. of Whitewater River
Palm Springs
Southeast corner of
15th Ave & West Dr
Desert Hot Springs
West side of
Longvue Rd
Sky Valley
West of Jefferson Street,
south of Fiesta Dr.
La Quinta
APN's 660-290-021
660-290-012; 660-300-
001, 005; 669-460-
007; 669-470-035;
669-490-002
522-080-043 656-060-001 & 002 647-100-011 600-010-019
Map Code 756 J-2 756 F2-3; G2-3;
H2-3; & J3 725 B-4 696 H-7 728 G-6 & H-6 5410 A-2
Sale Date Oct-16 Jun-18 Mar-18 Oct-16 Aug-15 Dec-16
Doc No 479697 262923 85810 441324 381411 542764
Buyer Coachella Valley
Conservation Commission
Coachella Valley
Conservation
Commission
Yoon Oh Hem Tan Lopez Coachella Valley Water
District
Seller Curci Trust Stevan Dweck Living
Trust Farm Holdings LP Priel Trust Wakil Tax Collector of Riverside
Land Area (Ac)3.88 338.59 17.60 28.91 20.00 2.74
Zone OS W & O5 O5 RR R-A-1¼RL
General Plan/Land Use Desert (1 DU/10 Ac) OS-C; OS-D; OS-W Desert (1DU/AC)RR RR RL
Topography Level Level to undulating Level to undulating Level Level Level
Access Paved road frontage Paved road frontage Unpaved road Unpaved roads Unpaved road Unknown
Utilities Electrical power Electricity and water Electrical power
Electricity; water in
area Electricity and water Public utilities available in
immediate area
Improvements None None None None None None
Price $15,500 $1,015,000 $75,000 $200,000 $115,000 $11,291
Price/Acre $3,995 $2,998 $4,261 $6,918 $5,750 $4,121
Sale Terms Seller cashed out Seller cashed out Seller cashed out Seller cashed out Seller cashed out Cash
Comments
Within 100-year
floodplain. Acquired for
conservation purposes.
Within 100-year
floodplain. Acquired
for conservation
purposes.
Raw desert land located
in a floodplain just west
of the Whitewater River.
Within 100-year
floodplain. Purchased
for speculation.
Within flood hazard
zone, Riverside County
Flood Control area. Also
within West Deception
Canyon Conservation
Area. Purchased for
speculation.
Adjacent to the Whitewater
River. Tax default sale
purchased by the Coachellla
Valley Water District to
preserve as part of a flood
control channel. Purchase
Price was based on back
taxes owed.
Summary of Market Data
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 21
acquired for conservation purposes. The sale occurred in June 2018 at a price of $1,015,000 or
$2,998 per acre, all cash to the seller.
Comparable No. 3 relates to the purchase of a level to undulating, 17.60 acre, nearly
rectangular shaped vacant parcel located south of Interstate-10, north of a portion of Tipton Road
that runs parallel to Highway 111 and west of the Whitewater River in Palm Springs. The land is
situated approximately 33 miles to the northwest of the subject. The site is zoned O5 (Open
Land), and the General Plan designation is Desert which allows a minimum parcel size of ten
acres. The site consists of raw desert land located in a floodplain just west of the Whitewater
River. Comparable 3 took place in March 2018 at a purchase price of $75,000 or $4,261 per
acre, all cash to the seller.
Comparable No. 4 involves the October 2016 sale of a 28.91 acre parcel of vacant land
that is located about 32 miles to the northwest of the subject in the City of Desert Hot Springs at
the southeast corner of 15th Avenue and West Drive, both of which are unpaved roadways. The
site is level and entirely within a 100-year flood hazard zone. The land is zoned and designated
RR (Rural Residential), which allows a five acre minimum parcel size. The property transferred
at a price of $200,000 or $6,918 per acre.
Comparable No. 5 is the August 2015 purchase of a level, 20.00 acre vacant parcel
located about 22 miles driving distance to the northwest of the subject in the unincorporated
Riverside County community of Sky Valley on the west side of Longvue Road. The site is
zoned R-A-1¼ by the County, and the General Plan designation is RR (Rural Residential) that
permits one dwelling unit per minimum parcel size of five acres. The entire property is within a
flood hazard zone, according the County of Riverside maps, and it is within a Riverside County
Flood Control area. Additionally, the land is within the West Deception Conservation Area of
the County. Comparable 5 was acquired for speculation at a price of $115,000 or $5,750 per
acre, all cash to the seller.
Comparable No. 6 is the December 2016 sale of a level, 2.74 acre site located about 6
miles north northwest of the subject in La Quinta. The site is located west of Jefferson Street
and south of Fiesta Drive and has unknown access. It is located adjacent to the Whitewater
River and was reportedly purchased by the Coachella Valley Water District to preserve as part of
a flood control channel. The zoning and General Plan designations are both RL (Low Density
Residential) which allows development of 2 to 4 residential dwelling units per acre. This was a
tax default sale that was purchased at an auction for $11,291 or $4,121 per acre. The purchase
price was based on back taxes owed.
Analysis of the Market Data
An adjustment grid has been prepared to reflect noted differences between the
comparable sales and the subject property. Transactional adjustments are considered for
Property Rights, Financing, Conditions of Sale and Market Conditions. Substantial downward
adjustments to all of the sales were required for Property Rights to reflect the fact that the subject
is encumbered with the right of way for the canal that greatly reduces the bundle of rights of the
underlying fee ownership. A downward adjustment was made to Sale 6 for Conditions of Sale as
that property was purchased at an auction for tax liens. No adjustments were required for
Financing for any of the comparables as all were cash sales. A review of the data support the
conclusion that limited-use parcels such as the subject in the local market area have not
experienced a quantifiable price escalation since 2015, the date of the oldest comparable sale.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 22
That market appears to have remained fairly stable and no adjustments for Market Conditions
have been made.
The physical elements of comparison that were considered in the Sales Comparison
Analysis include Location, Topography & Configuration, Parcel Size, Land Use Options and
Utilities. No adjustments were made for Location or Topography/Configuration considering the
limited use/floodplain use of the properties. Regarding parcel size, smaller sites usually tend to
attract a greater per acre price than larger parcels that are otherwise similar. This is due, in part,
to the greater number of potential buyers of those properties that have a lower overall cost. For
example, Sales 1 and 2 are in close proximity, but Sale 2 is much larger in size and sold for about
25 percent lower per acre. However, not all of that difference is likely attributable to size alone,
as Sale 1 had a general plan designation that could allow some development potential. We have
made an upward adjustment to Sale 2 to reflect its much larger size.
Downward adjustments were made to all of the comparables, except Sale No. 2, for Land
Use Options to reflect that their general plan and/or zoning designations may allow for some
speculative development potential. No adjustments were made for Utilities considering the
limited use/floodplain use of the properties.
Following is a summary of adjustments made to the comparables that reflect noted
differences between those properties and the subject property.
Prior to adjustments, the market data reflects unit prices ranging from $2,998 to $6,918
per acre. After adjusting the data for observed differences, the range of indicated values of the
six sales is from $1,724 to $2,767 per acre, with an average of $2,153 per acre. Less weight is
given to Sale 6 that was a tax default sale with the price determined by back taxes. If you
eliminate that sale the average indicated value of Sales 1 through 5 is $2,101 per acre. Based on
our analysis of the data and considering the overall legal and physical attributes of the appraised
Comp No 1 2 3 4 5 6
Sale Price/Acre $3,995 $2,998 $4,261 $6,918 $5,750 $4,121
Property Rights -50.0% -50.0% -50.0% -50.0% -50.0% -50.0%
Financing 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Conditions of Sale 0.0% 0.0% 0.0% 0.0% 0.0% 15.0%
Market Conditions 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Net Adjustment -50.0% -50.0% -50.0% -50.0% -50.0% -35.0%
Adjusted Value/Acre $1,997 $1,499 $2,131 $3,459 $2,875 $2,679
Location 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Topography & Configuration 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Parcel Size 0.0% 15.0% 0.0% 0.0% 0.0% 0.0%
Land Use Options -10.0% 0.0% -10.0% -20.0% -20.0% -10.0%
Utilities 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Net Adjustment -10.0% 15.0% -10.0% -20.0% -20.0% -10.0%
Indicated Value/Acre $1,797 $1,724 $1,918 $2,767 $2,300 $2,411
Land Sale Data Adjustment Grid
Market Data Adjustment Grid
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc. 23
property, as well as the definition of value, it is our opinion that the unit value of the six acre parcel
is equal to $2,100 per acre . When applied to the size of the subject parcel of 6.0 acres, the result
is our opinion of the fair market value, as of March 29, 2019.
$2,100 per acre x 6.0 acres = $12,600
ESTIMATED EXPOSURE TIME
The value estimate reflects a reasonable exposure time estimated at six months for the
subject property. According to the Uniform Standards of Professional Appraisal Practice,
Exposure Time is defined as the estimated length of time 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; a retrospective estimate based upon an
analysis of past events assuming a competitive and open market.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
Addenda
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
Aerial Photographs of Comparable Market Data
Comparable No. 1 – East side of Gene Autry Trail, Palm Springs.
Comparable No. 2 – East and west of Gene Autry Trail, Palm Springs.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
Aerial Photographs of Comparable Market Data
Comparable No. 3 – South of I-10, north of portion of Tipton Road that is parallel to Highway
111, west of Whitewater River, Palm Springs.
Comparable No. 4 – Southeast corner of 15th Avenue and West Drive, Desert Hot Springs.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
Aerial Photographs of Comparable Market Data
Comparable No. 5 – West side of Longvue Road, Sky Valley.
Comparable No. 6 – West of Jefferson Street, south of Fiesta Drive, La Quinta.
West Side of Jefferson Street, South of Avenue 52, La Quinta, California
Anderson & Brabant, Inc.
Anderson & Brabant, Inc.
QUALIFICATIONS OF THE APPRAISER
James Brabant, MAI
Anderson & Brabant, Inc.
353 W. Ninth Avenue
Escondido, CA 92025
(760) 741-4146 Ext. 312
Email: jlbrabant@aol.com
I. Resident of San Diego County since 1977
II. Educational Background:
A. University of Southern California, B.S. degree in Real Estate — 1960
B. School of Theology at Claremont, Master of Theology — 1966
C. Professional Education Completed:
1. Appraisal Institute
a. "Basic Appraisal Principles, Methods and Techniques" — Course I-A
b. "Capitalization Theory and Techniques" — Course I-B
c. "Urban Properties" — Course II
d. "Investment Analysis" — Course IV
e. "Standards of Professional Practice"
f. "Litigation Valuation"
g. Special Applications of Appraisal Analysis Course 301
2. Lincoln Graduate Center
a. Manufactured Housing Appraisal Course 669
3. Continuing Education (Partial List):
USPAP Course and Updates (every two years)
Four Hour Federal and State Laws, 1/16
Fundamentals of Separating Real Property, Personal Property, and Intangible
Business Assets 4/12
Eminent Domain Case Update, 10/95, 3/97, 10/07, 4/10
Business Practice and Ethics, 6/07, 7/12
San Diego Apartment & Housing Seminar, 10/98, 5/07, 9/11
Appraiser as Expert Witness, 12/06
Deal and Development Analysis – Downtown S.D., 9/05
Litigation Seminar, 11/04, 11/07, 11/10
Appraising Manufactured Housing, 1/04
Economic and Real Estate Forum, 09/02
Gramm-Leach-Bliley Act, 10/01
Condemnation on Trial (Participant), 5/00
Digging Into Ground Leases, 2/15
Unique Appraisal Assignments (Participant), 2/14
Appraisal of Partial Interests; 6/98
Vineyard Valuation, 11/12
Downtown San Diego Development, 9/15
Anderson & Brabant, Inc.
Qualifications of the Appraiser — James Brabant, MAI
Page Two
III. Professional Affiliations:
A. Member, Appraisal Institute, MAI (1985 President, San Diego Chapter)
B. Realtor Member, North County Association of Realtors
C. Member, International Right of Way Association
D. Real Estate Brokers License, State of California
E. Teaching Credential, State of California, Community College Level
F. Certified General Real Estate Appraiser (AG002100)
Office of Real Estate Appraisers, State of California
IV. Appraisal Experience:
Co-Owner — Anderson & Brabant, Inc., Since 1979
Co-Owner — Robert M. Dodd & Associates, Inc., 1977 - 1979
Appraisal Manager — California First Bank, Huntington Beach, California, 1974 - 1977
Staff Appraiser — California First Bank, San Diego, California, 1972 - 1974
Staff Appraiser — O. W. Cotton Co., San Diego, California, 1970 - 1972
Staff Appraiser — Davis Brabant, MAI, Huntington Park, California, 1960 - 1962
V. Teaching Experience:
Southwestern College, Chula Vista, California, "Real Estate Appraisal"
VI. Expert Witness:
Superior Court, San Diego, Los Angeles, Riverside, and San Bernardino Counties
Rent Control Hearings: Cities of Oceanside, Escondido, Ventura, Concord, Yucaipa, Carpenteria,
Palmdale, San Marcos, Carson, Watsonville
Various Arbitration Hearings
Assessment Appeals Boards of Riverside County, San Diego County and Orange County
Federal Bankruptcy Courts in San Diego County & Santa Barbara County
United States District Court – Northern District of California
VII. Types of Appraisals:
Residential Property: Single-family residence, condominiums, apartments,
subdivisions, existing and proposed
Commercial Property: Office buildings, shopping centers, office condominiums, etc.,
existing and proposed
Industrial Property: Single/multi-tenant, business parks, etc., existing and proposed
Vacant Land: Industrial, commercial, residential, and rural
Agricultural: Ranches, avocado and citrus groves, etc.
Special Purpose Appraisals: Leasehold estates, possessory interest, historical appraisals, etc.
Mobile Home Parks: For a variety of purposes including rent hearings, park closure, park
conversions, failure to maintain litigation, eminent domain, etc.
Anderson & Brabant, Inc.
Qualifications of the Appraiser — James Brabant, MAI
Page Three
VIII. Partial List of Appraisal Clients:
Banks
Bank of America
Bank of New York
City National Bank
Downey Savings
Fidelity Federal Bank
First Interstate Bank
First Pacific National Bank
Flagship Federal Savings
Great Western Bank
Industrial Bank of Japan
Palomar Savings & Loan
Redlands Federal Bank
Union Bank of California
Wells Fargo Bank
Government Agencies and Municipalities
California Department of
Transportation/Caltrans
Carlsbad Municipal Water District
City of Carlsbad
City of Chula Vista
City of Colton
City of Concord
City of Escondido
City of Laguna Beach
City of La Mesa
City of Salinas
City of San Bernardino
City of San Diego
City of San Marcos
City of Vista
City of Yucaipa
County of San Diego
Fallbrook Public Utility District
Metropolitan Water District
Oceanside Unified School District
Pacific Telephone
Poway Municipal Water District
Ramona Unified School District
SANDAG (San Diego Assoc. of Govts.)
San Diego County Water Authority
San Diego Unified Port District
San Marcos Unified School District
U.S. Depart. of the Interior
Bureau of Indian Affairs
U.S. Department of Justice
Law Firms
Aleshire & Wynder, LLP
Asaro, Keagy, Freeland. & McKinley
Best, Best & Krieger
Daley & Heft
Endeman, Lincoln, Turek & Heater
Foley & Lardner, LLP
Fulbright & Jaworski
Gray, Cary, Ware & Freidenrich
Higgs, Fletcher & Mack
Latham & Watkins
Lounsbery, Ferguson, Altona & Peak
Luce, Forward, Hamilton & Scripps
McDonald & Allen
McInnis, Fitzgerald, Rees, Sharkey & McIntyre
O'Melveny & Meyers
Procopio, Cory, Hargreaves & Savitch
Rutan & Tucker
Singer, Richard
Sullivan Wertz McDade & Wallace
Tatro & Zamoyski
Thorsnes Bartolotta & McGuire
Woodruff, Spradlin & Smart
Worden Williams, APC
Title Companies
Chicago Title
Fidelity National Title Insurance
First American Title
St. Paul Title
Title Insurance & Trust
Others
Avco Community Developers
Coldwell Banker
Dixieline Lumber
Golden Eagle Insurance
National Steel & Shipbuilding Co.
Northern San Diego County Hospital District
Prudential Insurance Corp.
Rosenow, Spevacek, Group
San Diego Gas & Electric Co.
San Luis Rey Downs (Vessels)
Steefel, Levitt & Weiss
Tellwright-Campbell, Inc.
Transamerica Relocation Service
Vedder Park Management