Dixie Phair (Any Municipality County’s Commercial Real Property Analyst) and Luke Warm (ownership tax representative) are mixing it up (having a discussion)…
Dixie: This is a well located property.
Luke: Well, it is and it isn’t.
Dixie: Why do you say that? The traffic count there is the highest in Any Municipality County, and the site has three drive cuts.
Luke: One cut is sort of smallish, and sometimes too much traffic is counterproductive. My client’s customers are busy people, and would avoid the area if they could.
Dixie: But actual store sale figures you provide prove that at least some of them keep coming back.
Luke: Doesn’t mean it’s not annoying to them. They have to buy stuff somewhere.
Dixie: So you are alleging 50% obsolescence to site and improvements for traffic congestion?
Luke: Should probably be more, but we’ll settle for 50% I guess.
Dixie: The new power center is just half a block away, and 90% of the outlots in that immediate area have national credit rated tenants. Do they suffer this same obsolescence from high traffic?
Luke: My client’s product sells itself. In fact, they probably could sell out with only an online presence.
Dixie: So why doesn’t he simply market online, then?
Luke: Expenses. He needs the expense of a bricks & mortar facility to offset his high income from sales.
Dixie: Great! What they claim to the IRS is their business, equitable real estate taxes included. But we will assign a triple net market rent to the real estate for assessment valuation. Those neighbors needing the exposure are our rent comparables!