VALUATION & ADVISORY SERVICES
CBRE, Inc.
5921 Owensmouth Avenue
Woodland Hills, CA
91367
February 26, 2024
Mr. Christopher Santoro
Director of Real Estate
Global Portfolio Management and Transactions
THE WALT DISNEY COMPANY
500 South Buena Vista Street
Burbank, California 91521
RE: Disneyland Resort Street Abandonments
Abandonment of a Portion of the Existing Magic Way
Abandonment of a Portion of the Existing Hotel Way
Abandonment of a Portion of the Existing Clementine Street Abandonment of a Future Street Dedication – Clementine Street Abandonment of a Future Street Dedication – Gene Autry Way
CBRE File No. CB23US041216-1
Dear Mr. Santoro:
CBRE is pleased to submit the following appraisal report of the above referenced property. It is our understanding that Walt Disney Parks and Resort s U.S., Inc. (“Disney”) is in discussions with the City of Anaheim (“City”) regarding the possibl e modification of certain existing and planned streets within the Disneyland Resort Specific Plan and Anaheim Resort Specific Plan areas, including the conversion of public rights of way land that would become available for private use by Disney.
The properties which are the subject of this appr aisal report include five street abandonments, three of which are existing streets and two of whic h are required future street dedications. The client and intended user of this report is Disney and the report is intended to be used in relation to negotiations between Disney and the City. No other party or parties may use or rely on the information, opinions, and conclusions contained in the report.
The effective date of value is July 5, 2023.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
The forthcoming valuation proceeds with the following four analyses:
Analysis 1: The abandonment of an existing 111,453± square foot (“sf”) portion of Magic Way, between Walnut Street and Disneyland Drive. The City of Anaheim is expected to retain certain utility easement rights within the area of Magic Way. For the purpose of our appraisal, we acknowledge and have adopted the assumption that these retained utility rights are for an underground waterlin e easement affecting 11,300 ±s f within the area that will otherwise be abandoned.
Analysis 2: The abandonment of an existing 12, 798± sf portion of Hotel Way, between Harbor Boulevard and Clementine Street. This valuation acknowledges that Southern California Edison (“Edison” or “SCE”) owns the underlying land and Disney owns the leasehold interest in the land that is beneath an Edison transmission line. The lease with Edison precludes any future structural development in the area of the to-be-abandoned street.
Analysis 3: The abandonment of an 47,767± sf portion of the existing Clementine Street, perpendicular and adjacent to Katella Avenue. The existing street is adjacent to the northern boundary of the Toy Story Lot.
Analysis 4: The abandonment of two future street dedications totaling 317,635± sf. If dedicated and improved, the two streets would represent the extensions of Clementine Street and Gene Autry Way, located within the Toy Story Lot.
Based on the analysis contained in the following report, and in conjunction with the appraiser’s workfile, our opinions of value are as follows:
MARKET VALUE CONCLUSION
Appraisal Premise Date of Value Value Conclusion
July 5, 2023 $12,030,000
July 5, 2023 $770,000
July 5, 2023 $5,375,000
July 5, 2023 $21,440,000
$39,615,000
Compiled by CBRE
Analysis 1 - Abandonment of a Portion of Magic Way
Total
Analysis 2 - Abandonment of a Portion of Hotel Way
Analysis 3 - Abandonment of a Portion of Clementine Street Analysis 4 - Abandonment of Future Street Dedications
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
It has been a pleasure to assist you in this assign ment. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us.
Respectfully submitted,
CBRE - VALUATION & ADVISORY SERVICES
John G. Ellis, MAI, CRE, FRICS
Certified General Real Estate Appraiser
California Certificate # AG007279
Telephone: (818) 290-5444
Email: [email protected]
Ryan J. Dobbins
Certified General Real Estate Appraiser
California Certificate # AG029385
Telephone: (818) 290-5432
Email: [email protected]
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
INTRODUCTORY INFORMATION
Some of the relevant information for this assignment, presented in part to address the requirements of Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice, is identified below.
Client, intended users, and intended use of the appraisal: The client and intended user of this report is Disney and the report is intend ed to be used in relation to negotiations between Disney and the City. No other party or parties may use or rely on the information, opinions, and conclusions contained in the report. Real property interest appraised: The property rights apprai sed which are applicable to this assignment are defined as follows:
Fee Simple Estate
Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the go vernmental powers of taxation, eminent domain, police power, and escheat.1
Easement
The right to use another’s land for a stated purpose.2
Type and Definition of Value: The current economic definition of market value agreed upon by agencies that regulate federal financia l institutions in the U.S. (and used herein) is as follows:
The most probable price which a property sh ould 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 is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby:
1 Appraisal Institute, The Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022) 2 Ibid.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
1. buyer and seller are typically motivated;
2. both parties are well informed or well ad vised, and acting in what they consider their own best interests;
3. a reasonable time is allowed for exposure in the open market;
4. payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and
5. the price represents the normal considerat ion for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.
3 Effective Date of the Appraisal: July 5, 2023.
Date of the Report: As noted above.
Prior Services: We have not provided any 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 agreement to perform this assignment. Ownership History: Title to the property that represents the focus of these valuation analyses is as follows:
1. Magic Way: The underlying land of this portion of Magic Way is owned by Walt Disney Parks and Resorts U.S., Inc., and is encumbered by easements in favor of the City of Anaheim for a public road, public utility, and other public purposes.
2. Hotel Way: The underlying land of Hotel Way is owned by Southern California Edison Company (“SCE”) and is encumbered by an easement in favor of the City of Anaheim for a public road. The property is further encumbered by a lease in favor of Disney for surface ingress and egress.
3 Interagency Appraisal and Evaluation Gu idelines; December 10, 2010, Federal Register, Volume 75 Number 237, Page 77472.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
3. Clementine Street: The underlying land of the existing Clementine Street is owned by Walt Disney Parks and Resorts U.S., Inc., and is encumbered by an easement in favor of the City of Anaheim for a public road.
4. The Future Street Dedications: The land that represents the future extensions of
Clementine Street and Gene Autry Way is owned by Walt Disney Parks and Resorts U.S., Inc. At the point in time when the Toy Story Lot is to be developed, a street dedication in favor of the City of Anaheim for public road purposes would be triggered under land use regulations for the site existing as of the date of valuation.
DESCRIPTION OF THE SUBJECT PROPERTY
At this point in the analysis, we will provide a descript ion of each of the existing streets or future street dedications.
Magic Way
Magic Way is an existing public street that runs in an east/west direction, between Walnut Street (to the west) and Disneyland Drive (to the east). The str eet carries two lanes of traffic in each direction.
The Pixar Pals Parking Structure, a five-level (plus roof top) garage is on the north side of this stretch of Magic Way, and a series of surface lots are located to the south. A cluster of townhome projects are located across Walnut Street to th e west and the Disneyland theme park is located across Disneyland Drive to the east.
The area of the Magic Way abandonment is 111,453± sf (2.56± acres), according to the Easement Deed (document number 18-375782) recorded on October 16, 2018. The following exhibit identifies the area of the Magic Way dedication and is follow ed by an aerial image with the approximate area to be abandoned outlined in red.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
The underlying land is owned by Disney, however, the land has been dedicated via easement to the City for public road purposes. In addition to the str eet right of way, there is an 11,300± sf (ten feet wide by 1,130-feet long) subterranean water easeme nt that runs the length of Magic Way. Although Disney seeks to extinguish the roadway easement, the water easement will still encumber the property in the after condition. The area of the easement that will remain is based on diagrams that appear to be accurate, but may be subject to modification. For the purpose of our appraisal, the use of the 11,300 ±sf area for the waterline easement is regarded as an assumption, subject to verification. No structural improvements will be permitted in the area of the water easement.
Hotel Way
Hotel Way provides access between Disney Way and a surface parking lot used by Disney employees.
To the west, Disney Way intersects Harbor Boulevard and to the east, with Clementine Street. Across Disney Way to the south is STC Anaheim GardenWalk, a 430,000± sf retail lifestyle center (built circa 2008).
The area of the Hotel Way abandonment is 12,798 ± sf (0.29± acres), according to Psomas. The following exhibit identifies the land area associated with the Hotel Way dedication and is followed by an aerial image with the approximate area to be abandoned outlined.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
The underlying land of Hotel Way is owned by Edison, however, the land is encumbered by a lease agreement whereby Disney owns the leasehold inte rest. The lease commencement date was January 13, 2014, and the initial term is 20 years. Disn ey has two separate 20-year options to extend the term, making the total potential lease term 60 years. If the options are exercised, the termination date would be January 12, 2074.
Edison has an aerial transmission line that runs in an east/west direction (parallel to Disney Way and perpendicular to Hotel Way). Following the aban donment of the roadway easement, the land will continue to be encumbered by the lease to Disney and no structural improvements will be permitted absent Edison’s approval which would likely be highly proscribed and may require reconfiguration of the transmission line.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
A street image (from the Disney Way vantage point) of Hotel Way, the surface parking lot, and the Edison transmission line is provided below.
Clementine Street
Clementine Street generally runs in a north/south direction and the portion to be abandoned is on the south side of Katella Avenue. This stretch of Clem entine represents the northerly entrance to the Toy Story Lot (a surface parking lot). Across Katella to the northwest, there is the JW Marriott Anaheim Resort which is adjacent to the east side of STC Anaheim GardenWalk.
The area of the Clementine Street abandonment is 47,767± sf (1.10± acres), according to the Easement Deed (document number 05-836426) reco rded on October 18, 2005. Once abandoned, Disney would own the fee simple interest in the ar ea of the former street. We are unaware of any easements that will adversely affect this portion of the property.
The following exhibit identifies the land area associated with the Clementine Street dedication.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Future Street Dedications - Clementine Street and Gene Autry Way The land known as the Toy Story Lot is a 76.21± acre (3,319,554± sf) surface parking lot owned by Disney. It is our understanding that if Disney was to develop the area of the Toy Story Lot, two public street dedications would be triggered under land use regulations for the site, as of the date of value.
Clementine Street, south of the aforementioned Clementine Street abandonment, would extend south through the lot. In addition, an east/west street wo uld be required and would be referred to as Gene Autry Way.
The total land area associated with the two future streets is 317,635± sf (7.29± acres). It is our understanding that the area of the two future stre ets will not be encumbered by any other easements (such as a water easement).
The following CAD image was prepared by Psomas and is followed by an aerial image with the approximate area of the Toy Story Lot outlined. The area calculations on the CAD image are incorrect. The image is included to provide a visual orientation as to how the future street dedications impact the Toy Story Lot.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
***THE AREA CALCULATIONS ON THE IMAGE ABOVE ARE INCORRECT. THE IMAGE IS INCLUDED FOR VISUAL REFERENCE ONLY.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
VALUATION ANALYSES
This valuation proceeds with the following four analyses:
Analysis 1: The abandonment of an existing 111,453± square foot (“sf”) portion of Magic Way, between Walnut Street and Disney land Drive. The City of Anaheim is expected to retain certain utility easement ri ghts within the area of Magic Way. For the purpose of our appraisal, we have adopted the assumption that these retained utility rights are for an underground waterline eas ement affecting 11,300 ±sf within the area that will otherwise be abandoned.
Analysis 2: The abandonment of an existing 12, 798± sf portion of Hotel Way, between Harbor Boulevard and Clementine Street. This valuation acknowledges that Edison owns the underlying land and Disney owns the leaseh old interest in the land that is beneath an Edison transmission line. The lease with Edison precludes any future structural development in the area of the to-be abandoned street absent Edison’s approval which would likely be highly proscribed and may require reconfiguration of the transmission line.
Analysis 3: The abandonment of an 47,767± sf portion of the existing Clementine Street, perpendicular and adjacent to Katella Avenue. The existing street is adjacent to the northern boundary of the Toy Story Lot.
Analysis 4: The abandonment of two future street dedications totaling 317,635± sf. If improved, the two streets would represent the extensions of Clementine Street and Gene Autry Way, located within the Toy Story Lot.
Under each analysis, we have utilized the sales comparison approach which will be discussed in the following pages.
VALUATION METHODOLOGY
The Across the Fence (ATF) method is “a land valuation method often used in the appraisal of corridors. The Across the Fence method is used to develop a value opinion based on comparison Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
to abutting land”.
4 Because the subject of the forthcoming an alyses consists of public streets, the ATF valuation provides an appropriate method of analysis. The ATF is the sales comparison approach modified to the degree that shape, topo graphy and access are disregarded. Size, to some degree, is considered. The subject streets are uniquely configured to meet the highest and best use as a right of way and should not be pe nalized for the special physical characteristics when compared with vacant parcels in the neighborhood. This methodology is utilized in our analysis to set the base land value for the subject streets.
LAND VALUATION
The following map and table summarize the comparabl e data used in each valuation analysis. A detailed description of each transaction is included following the maps and summary table.
4 Dictionary of Real Estate Appraisal, 7th ed. (Chicago: Appraisal Institute, 2022).
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Comparable Land Sales Map
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Comparable Land Sales Map – Anaheim Comparables Only
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
SUMMARY OF COMPARABLE LAND SALES
Actual Sale Adjusted Sale Size Size Price Per Price
No. Property Location Type Date Zoning Price Price 1 (Acres) (SF) Acre Per SF 1 Anaheim Express Inn Maingate
620 W Orangewood Ave
Anaheim, CA 92802
Sale Mar-23 C-R (Low Density) $10,450,000 $ 10,450,000 0.89 38,768 $11,741,573 $269.55 2 Commercial Land
18582 Teller Avenue
Irvine, CA 92612
Sale Nov-21 IBC 5.1 Multi-Use $38,740,000 $38,740,000 6.25 272,250 $6,198,400 $142.30 3 Parking Garage Partial Interest
1313 S. Disneyland Dr.
Anaheim, CA 92802
Sale Sep-21 Parking District $33,333,333 $33,333,333 9.37 408,244 $3,556,694 $81.65 4 Clementine Street Hotel Site
1730 S Clementine Street
Anaheim, CA 92802
Sale Aug-21 C-R (Medium
Density Modified
A)
$7,300,000 $7,450,000 0.69 29,926 $10,844,250 $248.95
5 Kings Inn Anaheim
415 W Katella Ave
Anaheim, CA 92802
Sale May-21 C-R (Low-Medium
Density)
$16,750,000 $16,750,000 2.83 123,275 $5,918,728 $135.88 6 42-acre Commercial Site
Barranca Pky
Irvine, CA 92618
Sale Dec-22 Trails and Transit
Oriented
$240,000,000 $240,000,000 42.00 1,829,520 $5,714,286 $131.18 Transaction
1Adjusted sale price for cash equivalency and/or development costs Compiled by CBRE
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
DISCUSSION/ANALYSIS OF LAND SALES
Land Sale One
T h i s p r o p e r t y i s l o c a t e d a t o n t h e s o u t h s i d e o f W e s t O r a n g e w o o d A v e n u e , w e s t o f S o u t h H a r b o r Boulevard, and just south of th e Anaheim Convention Center an d Disneyland. The approximately
0.89-acre (38,768± sf) site is rectangular in shape, generally level, and zoned C-R (Low Density).
Land uses surrounding the site include retail, hotel, and multifamily residential uses. At the time of sale, it was improved with a 63-room Anahei m Express Inn Maingate and was subsequently rebranded as the Queens Inn Anaheim after the sale . The 2-story exterior corridor motel features limited amenities, including an outdoor pool. In March 2023, the property sold for $10,450,000, equal to $269.55 psf of land area. The seller pre viously purchased the property in October 2022 for $9,300,000, spent a reported $200,000 in repairs, and subsequently resold the property in March 2023. The property was previously closed, prior to the recent renovation. The capitalization rate was reported at 9.19%, based on the trailing-12 month NOI of $961,342. However, adding management fees and replacement reserves, the capitalization rate is 8.03%.
The property is located approximately one-quarter m ile south of the Toy Story Lot, and as such, the locational characteristics are deemed similar. Th e zoning designation is generally consistent. The primary reason this sale is considered significantly superior to the subject property (on a price psf of land area basis), is the fact the site sold with a recently renovated lodging use.
Land Sale Two
The property is vacant land located mid-block alon g the east side of Teller Avenue, between Dupont Drive and Michelson Drive in Irvine. The site also has frontage along Jamboree Road along its eastern boundary. The 6.25-acre (272,250± sf) site is rectangular, generally level, and zoned IBC 5.1 (Multi- Use) within a business park in the City of Irvine. La nd uses surrounding the site include office to the north and south, a mix of office and industrial to the west, and multifamily residential to the east. At the time of sale, the property was fully entitled for an approximately 700,000 square foot mixed-use development consisting of a 258-room hotel, office space, medical office space, parking, a gym, and a food hall that was approved in 2019. However, the buyer purchased the site in order to develop a 140,000 square foot industrial project and placed no value on the mixed-use entitlements. The buyer had yet to file plans for the new industrial development when the property sold.
The property transferred on November 3, 2021, for $38,740,000, or $142.30 psf of land area.
The location of Item No. 2 in the City of Irvine is considered inferior in comparison to the subject’s location. In addition, this sale has an industrial -based zoning designation which also considered inferior. However, the property sold with entitlements for a 258-room hotel with commercial space Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
which is significantly superior. Overall, the price poin t reflected for Item No 2 is slightly inferior when compared to the subject property, on a price psf of land area basis.
Land Sale Three
This property is located at 1313 South Disneyland Drive, northwest of Disneyland, in Anaheim. The approximately 9.37-acre (408,244± sf) site is locate d within the Parking Dist rict of the Disneyland Resort Specific Plan. A 1998-built parking garage called the Mickey and Friends Parking Structure is partially located on the site. The property is irregu lar in shape, generally level, and is located within the Parking District of the Disneyla nd Resort Specific Plan. Surrounding uses include parking, retail, hotel uses and Disneyland. The land, which is subjec t to a ground lease, was partially owned by three siblings, each owning 10% interest in the underlyi ng fee interest in the property. The ground lease contains rent resetting provisions every 20 years. The last rent reset was in the second quarter of 2012, and the next rent reset oppo rtunity is scheduled for the second quarter of 2032. The price for the siblings' collective 30% fee interests was agreed upon at $10,000,000. It was structured as a fee simple interest in the land with some considerat ion for the existence of the lease. Disney had 1031 proceeds it needed to invest, but this did not caus e the buyer to overpay. The buyer was motivated to “buy down the risk” of future rent increases by taking control of the 30% portion. Based on the 30% partial interest, the purchase price equates to $33,33 3,333 for the equivalent of a 100% interest, or $81.65 per square foot of land. The property transferred on September 30, 2021.
Comparable 3 was the sale of a 30% interest, howe ver, the price was negotiated on the basis of a 100% interest in the land which was converted to th e price for the 30% interest . The pricing for this site is lower than the price applicable for a simila r land available for immediate development because the next rent resetting under the terms of the ground lease would not occur for another 11 years following the time of this sale. As such, the indicate d price per square foot is significantly inferior to the land value appropriate for the valuation of the subject parcels.
Land Sale Four
This 0.69-acre (29,926± sf) property is located on th e east side of South Clementine Street, north of West Katella Avenue, in Anaheim. The site is re ctangular, generally level, and zoned C-R (Medium Density Modified A) within the Anaheim Resort Spec ific Plan. Surrounding land uses include hotel and retail uses. It sold for land value in August 2021 for $7,300,000. The buyer plans to redevelop the site with the proposed 125-room Clementine Hotel. The application to demolis h the existing structure and build the hotel was filed in October 2020. It was sold by Hooshang Namvar to Jonathan Blanchard, founder and CEO of Blvd Hospitality. Co sts to demolish the existing 10,000-square-foot retail building were estimated at $15.00 per square f oot and have been included in the effective sales price. Therefore, the adjusted sale price is $7,450,000, or $248.95 psf of land area.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
With regard to the existing improvements, we accounted for the demolition costs. Nonetheless, the property was entitled for a new hotel at the time of sa le which is considered to be a superior attribute.
Primarily for this reason, this sale is deemed signif icantly superior to the subject property, on a price psf of land area basis.
Land Sale Five
This property is located on the north side of West Katella Avenue, east of South Harbor Boulevard and Disneyland, in Anaheim. The approximate 2.83-acre ( 123,275±sf) site is L-shaped, generally level, and zoned C-R within the Anaheim Resort Specific Pl an. At the time of sale, it was improved with a 173-room, 1971-built Kings Inn Anaheim. In May 2021, the property sold for $16,750,000, or approximately $135.88 per square foot of land.
Financing of the transaction was based on the cont inued operation of the older motel property that existed at time of sale. However, given the immediate proximity to Disneyland and California Adventure, the site is well suited to a higher-tier lodging use that would warrant redevelopment of the site.
The location of this property makes it a meaningful comparable. However, its shape provides limited frontage on Katella Avenue, indicating that its ultimate highest and be st use may occur after the site is assembled with one or more adjacent parcels. Theref ore, we consider parcel shape to be a factor of inferiority. Overall, this sale is a slightly inferior indictor of value for the current analysis.
Land Sale Six
Great Park Venture closed the sale of approximat ely 42 acres (1,829,520± sf) of commercial land for a price of $240.0 million. It was reported by th e seller “The fourth quarter was marked by taking the first step in executing on our commercial land sale strategy, with the sale of a 42 acre site at the Great Park. We have now demonstrated that our communities have two potential sources of meaningful land sale revenue – residential and commercial. While we are well aware that the interest rate and capital markets environment may impact our land sales in 2023, our team continues to be focused on our core priorities: generating reve nue; managing our capital spend; and diligently managing our selling, general and administrative expenses. Execution on these priorities should generate net positive cash flow for 2023 and pro vide the liquidity to allow us to capitalize on the opportunities that we expect will be available when the markets stabilize.” This property is located along Muirlands Boulev ard, south of Alton Parkway and east of the 5 Freeway, in the City of Irvine. The approximately 42-acre site is irregular in shape, generally level, and zoned Trails and Transit Oriented.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
In December 2022, the property sold for $240,000,000, or approximately $131.18 per square foot of land.
The location of this site in Irvine does not benefit from proximity to Disneyland or the Convention Center the way the subject land does. In addition, th is site is significantly larger in size which is deemed inferior. Overall, this sale is inferior in co mparison to the subject, on a price psf of land area basis.
OTHER TRANSACTIONS WITHIN THE ANAHEIM RESORT AREA
We are aware of the following two additional transa ctions within the immediate area of the Anaheim Resort, however they have not been included in the primary comparable data. Summaries of the two sales are presented in the following section.
1030-1042 West Ball Road
This property is comprised of 2 contiguous existing motel properties in Anaheim, including a Days Inn and Budget Inn. The two parcels total 47,172 square feet of commercial land, with frontage along W.
Ball Road and Disneyland Drive, proximate to the Disneyland entrance. The existing motels are 1 to 3 story, and built in 1959 and 1983. The properties were placed un der contract in early 2022 for assemblage from two separate sellers, and the buyer intends to demolish the existing improvements to construct a single hotel property. The site was unentitled as of the date of contract, and the buyer is researching the development potential with regard s to potential key count of the proposed hotel redevelopment. The Days Inn property was under contract and closed in September 2022 for $8,600,000 and the Budget Inn property is under contract for $12,000,000 but has not yet closed, indicating a total contract price of $20,600,000, or $436.70 per square foot of land area. The buyer confirmed that as of December 2022, the Budget I nn property is still under contract, and they are seeking approval from the city to redevelop the site to 234 keys, indicating a sales price of $88,034 per key; however, this would likely require a zoni n g v a r i a n c e o r z o n i n g c h a n g e f r o m t h e C i t y .
Demolition costs were not factored into the effective sales price.
Due to the pending status of the assemblage and th e possibility of the second transaction falling out of escrow, this sale is not considered applicable to the subject and has not been included in the primary data set.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
1770 South Harbor Blvd
This retail property is located at the northeast co rner of South Harbor Boulevard and West Katella Avenue in Anaheim. The 49,602-square-foot site is improved with a one-story, 1987-built retail strip building totaling 9,998 square feet. Tenants includ e mostly local tenants. In August 2022, the property sold for $19,500,000, or approximately $1,950 per square foot of building area or $393 per square foot of land area. The buyer satisfied a 1031 exchange with this ac quisition. The property was fully occupied at the time of sale, and the in-place capitalization rate was 4.41%.
Due to the retail improvements existing on the site at the time of sale, this transaction is not considered applicable and has not been included in the primary data set.
Land Sale Array
Based on the preceding analysis, the comparable data and the subject property are arrayed as follows:
Item Overall Price PSF
No. Comparability of Land Area
1 Significantly Superior $269.55
4 Significantly Superior $248.95
SUBJECT PROPERTY
2 Slightly Inferior $142.30
5 Slightly Inferior $135.88
6 Inferior $131.18
3 Significantly Inferior $81.65
Compiled by CBRE
LAND SALE ARRAY
Analysis of the comparable sales and other data fr om the competitive market area indicates a base value of $150.00 per square foot of land area as being the appropriate starting point in our across the fence analysis when considering land as if held in fee simple interest.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Analysis 1
We now turn to Analysis 1, the abandonment of an existing 111,453± square foot (“sf”) portion of Magic Way, between Walnut Street and Disneyland Dr ive. This valuation acknowledges the City will retain an 11,300± sf subterranean water easement.
The land area in this analysis is allocated as follows:
Area of Magic Way net of the area of the Water Easement: 100,153± sf Area of Magic Way that is also Burdened with the Water Easement: 11,300± sf Total Area of Magic Way to be Abandoned: 111,453± sf
Based on the analysis of the preceding comparable land sales, we have concluded at an unencumbered land value of $150.00 psf.
The abandonment of this portion of Magic Way will result in an elimination of street frontages that are improved and maintained via a City Land scape and Lighting District called the Anaheim Resort Maintenance District. The District is funded based on the areas where it is needed for landscaping and lighting. The elimination of this portion of Magic Way will result in a loss of revenue service area. It will also result in a re duction the District’s expenses related to the work that would otherwise be needed in these areas. With these offsetting factors, it is our opinion that the impact to the District is a “net neutral,” meaning, any foregone revenue to the District is offset by reduced expenses. Accordingly, we make no adjustment to the value of the area of the proposed street abandonment.
Before the abandonment, we are of the opinion the City’s rights equal 75% of the unencumbered fee simple interest in the area of the street net of the water easement. The public has the right to use the City street and Disney does not have any development rights but does have potential subsurface rights. We are of the opinion the City ’s rights in the area encumbered by the water easement are an additional 20% for a total of 95% of the fee simple interest in the area burdened by both the street easement and the water easement.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
The valuation calculation of the City’s rights in the before condition are:
Land Area
PSF Value % of Fee Value
Magic Way Net of Water Easement 100,153 sf x $150.00 x 75% = $11,267,213 Area of Magic Way with the Water Easement 11,300 sf x $150.00 x 95% = $1,610,250 Total $12,877,463
The City’s rights in the after condition include only the subterranean water easement with rights to surface use for repair and maintenance. Disney will be able to use the surface rights of the land encumbered by the easement for non-structural purp oses and the rights retained by the City are less injurious to the property as compared to the before condition. We are of the opinion the rights for the water easement retained by the City are equal to 50% of the fee simple interest. 5 The calculations are as follows:
Land Area PSF Value % of Fee Value
Area of the Water Easement 11,300 sf x $150.00 x 50% = $847,500 The value of the rights to be acquired by Disn ey represent the difference in value between the before and after conditions.
Value of the City’s Rights in the Before Condition $12,877,463 Value of the City’s Rights in the After Condition $847,500 Total Value of the City’s Rights to be Acquired $12,029,963 Rounded $12,030,000
5 The burden of the water easement as a percent of fee si mple interest is 20% when accompanied by the street easement because the street easement creates a substantial burden on the property. With the street easement removed but the water easement remaining, the wa ter easement by itself imposes a more substantial burden, expressed as 50% of the rights associated with fee simple interest.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Analysis 2
The underlying land of Hotel Way is owned by SCE and is encumbered by an easement in favor of the City of Anaheim for a public road. The property is further encumbered by a lease in favor of Disney for surface ingress and egress. It is our understanding the re maining term of the lease is approximately 60 years. Structural improvement is not permitted in the area beneath the SCE transmission line (which includes the entirety of the Hotel Way right of way).
In this analysis, we value the rights associated with the abandonment of Hotel Way but acknowledge the land will continue to be encu mbered by the lease to Disney in the after condition. Only the surface use of the land will be permitted (in the after condition).
The area of Hotel Way proposed to be abandoned is 12,798± sf.
As noted in the previous analysis, the surface rights of the street are equal to 75% of the unencumbered fee simple interest, in our op inion. The inability to provide structural improvements in the area beneath the transmission line equate to 50% of the City’s 75% of rights for the street, which is equal to 37.5% (50% x 75% = 37.5%). We have rounded the percentage of fee interest to 40%.
The valuation calculations for the abandonment of a portion of Hotel Way, recognizing the SCE transmission line, are as follows:
Land Area
PSF Value % of Fee Value
Area of Hotel Way to be Abandoned 12,798 sf x $150.00 x 40% = $767,880 Rounded $770,000
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Analysis 3
This analysis represents the abandonment of an 47,767± square foot portion of the existing Clementine Street right-of-way (perpendicular and adjacent to Katella Avenue).
The surface rights of the existing Clementine Street right-of-way ar e equal to 75% of the unencumbered fee simple interest, in our opinion. The valuation calculations to value the existing portion of Clementine Street are as follows:
Land Area PSF Value % of Fee Value
Area of Existing Clementine Street 47,767 sf x $150.00 x 75% = $5,373,788 Rounded $5,375,000
Analysis 4
Analysis 4 is the abandonment of two future street dedications (Clementine Street and Gene Autry Way) totaling 317,635± square feet.
The land area associated with the future Clemen tine Street and Gene Autry Way dedications is 317,635± square foot. We have discounted the unen cumbered fee simple interest land value by 10% to account for the size of the larger land holding of the parent parcel. As such, the starting point in this valuation is $135.00 psf ($150.00 x 90% = $135.00).
The City’s rights to obtain the future dedication of the 317,635 ±square foot areas of Clementine Street and Gene Autry Way is a less valuable pr operty right compared to having the current and ongoing rights to the use of this land for street purposes. Until the dedication is made, Disney may continue using the surface of the land for pa rking and related purposes. The dedication will be made when the land adjacent to these future streets is proposed for development in the future.
The duration of delay before the dedication of th ese streets is made affects the present value of the property rights held by the City. In considering the potential delay preceding future development (and the triggering of the future dedication requirement), we consider market demands in the area by all potential participants without limiting consideration to the actual Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
intentions of the current owner. In terms of overall market demand, it is our opinion that development of at least a portion of the Toy St ory lot is foreseeable within approximately two years. For the purpose of this analysis, we conc lude that a period of two years would transpire before additional development would be warranted on a portion of the existing Toy Story lot.
Reflecting the risks and capital return requirements for future development on unentitled land, we apply a 20% annual discount rate. For the two-year period, this results in a present value factor of 0.6944. This present value factor is applied to the 75% property rights factor that the City would have if it currently had this land for public street use. This calculation indicates a percentage of property rights at 52% held by the City, which we have rounded to 50% for our analysis.
The valuation of the abandonment of the future right-of-way dedications is provided below.
Land Area
PSF Value % of Fee Value
Area of Future Street Dedications 317,635 sf x $135.00 x 50% = $21,440,363 Rounded $21,440,000
The total value of the City’s rights under the four preceding analyses are:
MARKET VALUE CONCLUSION
Appraisal Premise Date of Value Value Conclusion
July 5, 2023 $12,030,000
July 5, 2023 $770,000
July 5, 2023 $5,375,000
July 5, 2023 $21,440,000
$39,615,000
Compiled by CBRE
Analysis 1 - Abandonment of a Portion of Magic Way
Total
Analysis 2 - Abandonment of a Portion of Hotel Way
Analysis 3 - Abandonment of a Portion of Clementine Street Analysis 4 - Abandonment of Future Street Dedications
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Additional data is retained in our file. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us.
Respectfully submitted,
CBRE - VALUATION & ADVISORY SERVICES
John G. Ellis, MAI, CRE, FRICS
Certified General Real Estate Appraiser
California Certificate # AG007279
Telephone: (818) 290-5444
Email: [email protected]
Ryan J. Dobbins
Certified General Real Estate Appraiser
California Certificate # AG029385
Telephone: (818) 290-5432
Email: [email protected]
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Certification
We certify to the best of our knowledge and belief:
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are li mited only by the reported assumptions and limiting conditions and are our personal, impartial and unbiased professional analyses, opinions, and conclusions.
3. We have no present or prospective interest in or bias wi th respect to the property that is the subject of this report and have no personal interest in or bias with respect to the parties involved with this assignment.
4. Our engagement in this assignment was not contingent upon developing or reporting predetermined results.
5. Our compensation for completing this assignment is not contingent upon the development 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.
6. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Pr actice, as well as the requirements of the State of California.
7. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute.
8. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.
9. As of the date of this report, John G. Ellis, MAI, CRE, FRICS, has completed the continuing education program for Designated Members of the Appraisal Institute.
10. As of the date of this report, Ryan J. Dobbins has completed the Standards and Ethics Education Requirements for Candidates/Practicing Affiliates of the Appraisal Institute.
11. John G. Ellis, MAI, CRE, FRICS, has m ade a personal inspection of the prop erty that is the subject of this report. Ryan J. Dobbins has not inspected the property.
12. No one provided significant real property appraisal assistance to the persons signing this report.
13. Valuation & Advisory Services operates as an indepe ndent economic entity within CBRE, Inc. Although employees of other CBRE, Inc. divisions may be co ntacted as a part of our routine market research investigations, absolute client confidentiality and privac y were maintained at all times with regard to this assignment without conflict of interest.
14. John G. Ellis, MAI, CRE, FRICS, and Ryan J. Dobbins ha ve not provided any 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 agreement to perform this assignment.
John G. Ellis, MAI, CRE, FRICS
Certified General Real Estate Appraiser
California Certificate # AG007279
Ryan J. Dobbins
Certified General Real Estate Appraiser
California Certificate # AG029385
Assumptions and Limiting Conditions
1. CBRE, Inc. through its appraiser (collectively, “CBRE”) has inspected through reaso nable observation the subject property. However, it is not possible or reasonably practicable to personally inspect conditions beneath the soil and the entire interior and exterior of the improvements on the subject property. Therefore, no representation is made as to such matters.
2. The report, including its conclusions and any portion of such repo rt (the “Report”), is as of the date set forth in the letter of transmittal and based upon the inform ation, market, economic, and property conditions and projected levels of operation existing as of such date. The dollar amount of any conclusion as to value in the Report is based upon the purchasing power of the U.S. Dollar on such date. The Report is subject to change as a result of fluctuations in any of the foregoing. CBRE has no obligation to revise the Report to reflect any such fl uctuations or other events or conditions which occur subsequent to such date.
3. Unless otherwise expressly noted in the Report, CBRE has assumed that:
(i) Title to the subject property is clear and marketable and t hat there are no recorded or unrecorded matters or exceptions to title that would adversely affect marketability or value. CBRE has not examined title records (including without limitation liens, encumbrances, ea sements, deed restrictions, and other co nditions that may affect the title or use of the subject property) and makes no representations re garding title or its limitation s on the use of the subject property. Insurance against financial loss t hat may arise out of defects in title sh ould be sought from a qualified title insurance company.
(ii) Existing improvements on the subject property conform to applicable local, state, and federal building codes and ordinances, are structurally sound and seismically safe, and have been built and repaired in a workmanlike manner according to standard practices; all build ing systems (mechanical/electrical, HV AC, elevator, plumbing, etc.) are in good working order with no major de ferred maintenance or repair required; and the roof and exterior are in good condition and free from intrusion by the elements. CBRE has not retained independe nt structural, mechanical, electrical, or civil engineers in connection with this appraisal and, therefor e, makes no representations relative to the condition of improvements. CBRE appraisers are not engineers and are not qualifie d to judge matters of an engineering nature, and furthermore structural problems or building system problems may not be visible. It is expressly assumed that any purchaser woul d, as a precondition to closing a sa le, obtain a satisfactory engineering report relative to the structural integrity of the property and the integrity of building systems. (iii) Any proposed improvements, on or off-site, as well as any alterations or repairs considered will be completed in a workmanlike manner according to standard practices.
(iv) Hazardous materials are not present on the subject property. CBRE is not qualified to detect such substances. The presence of substances such as asbestos, urea formalde hyde foam insulation, contaminated groundwater, mold, or other potentially hazardous materials may affect the value of the property. (v) No mineral deposit or subsurfa ce rights of value exist with respect to th e subject property, whether gas, liquid, or solid, and no air or development rights of value may be transferred. CBRE has not considered any rights associated with extraction or exploration of any resources, unless otherwise expressly noted in the Report. (vi) There are no contemplated pu blic initiatives, government al development controls, rent controls, or changes in the present zoning ordinances or regulations go verning use, density, or shape that wo uld significantly affect the value of the subject property.
(vii) All required licenses, certificates of occupancy, consents, or other legislativ e or administrative authority from any local, state, nor national government or private entity or organization have been or can be readily obtained or renewed for any use on which the Report is based.
(viii) The subject property is managed and operated in a prud ent and competent manner, neit her inefficiently or super- efficiently.
(ix) The subject property and its use, management, and operation are in full compliance with all applicable federal, state, and local regulations, laws, and restrict ions, including without limi tation environmental laws, seismic hazards, flight patterns, decibel levels/noise envelopes, fire hazards, hillside ordinances , density, allowable uses, building codes, permits, and licenses.
(x) The subject property is in full compliance with the Americans with Disabilities Act (ADA). CBRE is not qualified to assess the subject property’s compliance with the ADA, notwithstanding any discussion of possible readily achievable barrier removal construction items in the Report.
(xi) All information regarding the areas and di mensions of the subject property fu rnished to CBRE are correct, and no encroachments exist. CBRE has neither undertaken any survey of the boundaries of the subject property nor reviewed or confirmed the accuracy of any legal description of the subject property.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
Unless otherwise expressly noted in the Report, no issues regarding the foregoing were brought to CBRE’s attention, and CBRE has no knowledge of any such facts affecting the subject property. If any information inconsistent with any of the foregoing assumptions is discovered, such information could have a substant ial negative impact on the Report.
Accordingly, if any such information is subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. CBRE assumes no responsibility fo r any conditions regarding the foregoing, or for any expertise or knowledge required to discover them. An y user of the Report is urged to retain an expert in the applicable field(s) for information regarding such conditions.
4. CBRE has assumed that all documents, data and information fu rnished by or behalf of the client, property owner, or owner’s representative are accurate and correct, unless otherwise expressly no ted in the Report. Such data and information include, without limitation , numerical street addresses, lot and bloc k numbers, Assessor’s Parcel Numbers, land dimensions, square footage area of the land, dimensions of the improvem ents, gross building areas, net rentable areas, usable areas, unit count, room count, rent schedule s, income data, historical op erating expenses, budgets, and related data. Any error in any of the above could have a substantial impact on th e Report. Accordingly, if any such errors are subsequently made known to CBRE, CBRE reserves the right to am end the Report, which may include the conclusions of the Report. The client and intended user sh ould carefully review all assumptions, data, relevant calculations, and conclusions of the Repo rt and should immediately notify CBRE of any questions or errors within 30 days after the date of delivery of the Report.
5. CBRE assumes no responsibility (includi ng any obligation to procure the same) fo r any documents, dat a or information not provided to CBRE, including without limitation any termite inspection, survey or occupancy permit.
6. All furnishings, equipment and business operations have been di sregarded with only real pr operty being considered in the Report, except as otherwise expressly stated and typically considered part of real property.
7. Any cash flows included in the analysis are forecasts of estimated future operating c haracteristics based upon the information and assumptions contained within the Report. Any projection s of income, expenses and economic conditions utilized in the Report, including such cash flows, should be consid ered as only estimates of the expectations of future income and expenses as of the date of the Report an d not predictions of the future. Actual results are affected by a number of factors outside the control of CBRE, incl uding without limitation fluctu ating economic, market, and property conditions. Actual results ma y ultimately differ from th ese projections, and CBRE does not warrant any such projections.
8. The Report contains professional opin ions and is expressly not intended to serve as any warranty, assurance or guarantee of any particular value of the subject property. Other appraisers may reach diffe rent conclusions as to the value of the subject property. Furthermore, market value is highly related to exposure ti me, promotion effort, terms, motivation, and conclusions surro unding the offering of the subject property. The Report is for the sole purpose of providing the intended user with CBRE’s independent professional opinion of the va lue of the subject property as of the date of the Report. Accordingly, CBRE shall not be liable for any losses that arise from any investment or lending decisions based upon the Report that th e client, intended user, or any buyer, se ller, investor, or lending institution may undertake related to the subject property, and CBRE has not been compensated to assume any of these risks. Nothing contained in the Report shall be constr ued as any direct or indi rect recommendation of CBRE to buy, sell, hold, or finance the subject property.
9. No opinion is expressed on matters whic h may require legal expertise or specializ ed investigation or knowledge beyond that customarily employed by real estate appraisers. Any user of the Report is advis ed to retain experts in areas that fall outside the scope of the real estate appraisal profession for such matters.
10. CBRE assumes no responsibility for any costs or consequences arising due to th e need, or the lack of need, for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for Flood Hazard Insurance.
11. Acceptance or use of the Report cons titutes full acceptance of these A ssumptions and Limiti ng Conditions and any special assumptions set forth in the Report. It is the responsi bility of the user of the Report to read in full, comprehend and thus become aware of all such assumptions and limiting conditions. CBRE assumes no responsibility for any situation arising out of the user’s failure to become familiar with and understand the same.
12. The Report applies to the property as a whole only, and any pro rati on or division of the title in to fractional interests will invalidate such conclusions, unless the Report expressly assumes such pro ration or division of interests.
13. The allocations of the total value estimate in the Report between land and improvements apply only to the existing use of the subject property. The allocation s of values for each of the land and improvements are not intended to be used with any other property or appraisal and are not valid for any such use.
Mr. Christopher Santoro
THE WALT DISNEY COMPANY
February 26, 2024
14. The maps, plats, sketches, graphs, photographs, and exhibits incl uded in this Report are for illustration purposes only and shall be utilized only to assist in visualizing matters discussed in the Report. No such items shall be removed, reproduced, or used apart from the Report.
15. The Report shall not be duplicated or provided to any unintended users in whole or in part without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Exempt from this restriction is duplication for the internal use of the intended user and its attorneys, accountants, or advisors for the sole benefit of the intended user. Also exempt from this restriction is transmi ssion of the Report pursuant to any requirement of any court, governmental authority, or regulatory agency having jurisdiction over the intended user, provided that the Report and its contents shall not be published, in whole or in part, in any public document without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Finally, the Report shall not be made available to the public or otherwise used in any offering of the property or any securi ty, as defined by applicable law. Any un intended user who may possess the Report is advised that it shall not rely upon th e Report or its conclusions and that it should rely on its own appraisers, advisors and other consultants for any decision in connection with the subject property . CBRE shall have no liability or responsibility to any such unintended user.
1 ©2024 CBRE, INC.
PROFILES
VALUATION & ADVISORY SERVICES
John G. Ellis, MAI, CRE,
FRICS
Executive Vice President
Los Angeles, CA
T +1 818 290 5444
E [email protected]
Professional Experience
John G. Ellis, MAI, CRE, FRICS is an Exec utive Vice President for CBRE's Valuation & Advisory Services (VAS). He has provided real estate valuation and consulting services in Southern California for more than 40 years.
Mr. Ellis is an instructor of appraisal courses and a frequent speaker at seminars and conferences. He is also an author whos e work has been published by the Appraisal Institute and in magazines and professional journals.
He has qualified as an expert witness and has provided expert testimony throughout California on assignments related to emin ent domain, allegations of damage, fair market rent, ad valorum tax burdens, ma rital dissolutions, partial interest and partnership ownership interests, and appraisa l review. He has testified in more than 30 trials in federal and superior courts, a variety of appeal board and arbitration hearings, and more than 200 depositions. He has also been retained as an arbitrator and as a court-appointed expe rt. John serves a client base that includes lending institutions, public agencies, corporate and individual property owners, and the legal profession.
He has appraised office buildings (includi ng medical office buildings), shopping centers, industrial buildings, apartment and condominium complexes (including affordable housing projects), subdivisions, mobile home parks, hotels, motels, restaurants, healthcare properties, religiou s facilities, bowling alleys, golf courses, amusement parks, horse racing parks, auto dealerships, gas stations, carwashes, motion picture and performing arts thea ters, cold storage and food processing facilities, parking structures, transit-or iented development projects, shipping terminals and other types of waterfront property, industrial, commercial and residential acreage, agricultural land, mo untainous and hillside acreage, utility and transportation corridors (in fee and as easements), designated open space, and single- family residences including hillside and beachfront homes and major estates.
Professional Affiliation
/ Accreditations
Member: Appraisal Institute (more
than 20 years of volunteer work on
boards and committees of the
Appraisal Institute; past president o
the Southern California Chapter of
the Appraisal Institute; recognized
as “Volunteer of Distinction” for
Region VII in 2013; recipient of the
Bert L. Thornton Lifetime
Professional Service Award in 2018
current member of The Appraisal
Journal Editorial Board)
Member: The Counselors of Real
Estate
Fellow: Royal Institution of
Chartered Surveyors
Member: International Right of Wa
y
Association
Licensed: California Certified
General Real Estate Appraiser
Licensed: California Real Estate
Broker
Education
B.A., Business/Economics, Universit
of California, Los Angeles
Certified by the Appraisal Institute’
Professional Affiliations
/ Accreditations
‒ Member: Appraisal Institute (more
than 20 years of volunteer work on
boards and committees of the
Appraisal Institute; past president
of the Southern California Chapter
of the Appraisal Institute;
recognized as “Volunteer of
Distinction” for Region VII in 2013;
recipient of the Bert L. Thornton
Lifetime Professional Service
Award in 2018; current member of
The Appraisal Journal Editorial
Board)
‒ Member: The Counselors of Real
Estate
‒ Fellow: Royal Institution of
Chartered Surveyors
‒ Member: International Right of Way
Association
‒ Licensed: California Certified
General Real Estate Appraiser
‒ Licensed: California Real Estate
Broker
Education
‒ B.A., Business/Economics,
University of California, Los
Angeles
‒ Certified by the Appraisal
Institute’s program of continuing
education for its designated
members
2 ©2024 CBRE, INC.
PROFILES
Published Texts and Articles
“Office Markets are Preparing for the New Normal,” (National Real Estate Investor, July 2020). “Lease Renewal–The Periodic Setting of Market Rent in a Long-Term Lease,” in Applications in Litigation Valuation: A Pragmatist’s Guide (Chicago: Appraisal Institute, 2012). “Los Angeles Industrial Market Highlights,” Western Real Estate Business, October 2008. “Los Angeles Apartment Trends,” Western Real Estate Business, November 2007. “Can Downtown Support Another High-Rise?” Real Estate Southern California, March 2007. “The Special Nature of Property Tax Appraisals” (co-author ed with Kathy Spletter and Cris K. O’Neall), Institute for Professionals in Taxation, June 2006.
Expert Testimony
Mr. Ellis is qualified as an expert witness in real estate valuation matters and has testified before:
Superior Courts within the California counties of Los Angeles, Orange, Rivers ide, San Bernardino , Ventura, Kern, and Imperial; and within the Third Judicial District of Alaska United States District Court
United States Bankruptcy Courts: Central, Northern, and Southern Districts of California Tax Appeal Boards: Los Angeles, Orange, Riverside, San Bernardino, San Diego, and Contra Costa counties Arbitration testimony at hearings in Los Angeles, Orange, San Diego, and Sacramento counties Rent Control Boards: cities of Santa Monica, West Hollywood, and Carson (MRRB) He has also been appointed by the Superi or C ou r t of L o s A ngeles Cou nt y o n s ever al occasions to assist in reconciling the disparate opinions of opposing, privately retained valuation experts.
Seminar Presentations and Speaking Engagements
Southern California Real Estate Market Trends (Counselors of Real Estate, February 13, 2024, February 2, 2022) What Attorneys Need to Know About Real Estate Appraisals (CLE International Eminent Do main Conference, February 9, 2024)
Real Estate Economic Trends (IRWA Chapter 67, Orange Coun ty, January 2024, 2023, 2022, 2021, 2020, 2019, 2018, 2017, 2016, 2015, 2014, 2013, 2012, September 2010)
Environmental Contamination Issues in Eminent Domain Valuations (SCCAI, 55th Annual Litigation Seminar, November 3, 2022)
Valuation of Easements (IRWA Chapter 1, Los Angeles, 30th Annual Valuation Seminar, May 24, 2022) The Impact of the Pandemic on Property Values – Real Life Examples and Practical Knowledge (CLE International Eminent Domain Conference, February 11, 2021)
Appraisal Issues with Environmentally Impaired Properties (IRWA Chapter 1, May 25, 2023) Hybrid Work Impacts on the Office Markets in Southern California (CRE and CCIM presentation, May 23, 2023) Appraisal Issues – Does a Shrinking Litigation Appraise r Pool Impair Just Compensation for Owner and Agency? (CLE International Eminent Domain Conference, March 16, 2023) Severance Damages and Project Benefits in Transit Projects (IRWA Chapter 1, Los Angeles, February 25, 2020) Chairman/Moderator of the Annual Litigation Seminar of the So uthern California Chapter of the Appraisal Institute (2019, 2017, 2013, 2005, and 1999)
Real Estate and the Economy – Are We Still on Track? (IRWA Chapter 1, January 2019) Los Angeles County Economic and Market Trends (IRWA Chapter 1, February 2019) Severance Damages – Fact or Fantasy (SCCAI, 51st Annual Litigation Seminar, Los Angeles, November 1, 2018)
3 ©2024 CBRE, INC.
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The Cost Approach and All That Jazz (IPT 42nd Annual Conference, Vancouver, BC, June 2018) Building a Base for Value: Opinions and Testimony Supported by Multiple Experts (SCCAI, 50th Annual Litigation Seminar, Arcadia, November 9, 2017)
The Project Influence Rule (Nossaman LLP 2017 Eminent Domain Seminar, March 2, 2017) Why the Project Design and Plans Matter (CLE International Eminent Domain Conference, February 10, 2017) Expanding the Subway in the CBD: Valuation Issues (IRWA Chapter 1, Annual Valuation Seminar, April 26, 2016) Cap and Discount Rates for Possessory Interest and Other Special Situations (2016 IAA0-LA Spring Appraisal Seminar, April 13, 2016)
Inland Empire Market Trends (IRWA Chapter 57, January 2015, February 2012) Subdivision Analysis in Southern Calif ornia: Methodology and Discount Rates (SCCAI, Subdivision Land Seminar, August 21, 2014)
Examination of Appraisal Practices in Tax Appeal Hearings (SCCAI, 46th Annual Litigation Seminar, Los Angeles, November 15, 2013)
Current Issues in Real Estate Appraisals (Lorman Education Services, live audio conference, March 8, 2012) Real Estate Market Trends (SCCAI Market Trends Seminar, Los Angeles, January 24, 2013) Underwriting Sustainable Commercial Properties (2011 National Association of Realtors Conference, November 12, 2011) Commercial Property Valuation Issues and Trends (2011 IAAO-LA Spring Appraisal Seminar, April 6, 2011) The Assessment Appeals Process: Practical Perspectives (SCCAI, 43rd Annual Litigation Seminar, November 17, 2010) Legal Issues in Appraisals: What and When to Ask the Attorney (IRWA Right of Way and the Law Seminar, June 22, 2010) Current Issues in the Economy and Re sidential and Commercial Real Estate (The Housing Authority of the City of Los Angeles, May 24, 2010)
Current Issues in the Economy, Commercial Real Estate, and Real Estate Appraisals (MCLE-approved presentation, April 15, 2010)
The Role of the Appraiser in Construction Defect Litigation (MCLE-approved presentations, February 10 and March 4, 2010) Real Estate Values: Have We Hit Bottom Yet? (IRWA Chapter 1, Los Angeles, 2009 Annual Fall Seminar, October 20, 2009) Impact of Use Restrictions in Mar ket Value and Market Rent Appraisals (SCCAI, Special Purpose Properties Seminar, October 20, 2009)
Rent Re-Setting Via Litigation (Integra Academy, September 14, 2009) Industrial Property Trends: Los An geles County and the Inland Empire (SCCAI, 15 th Annual Summer Conference, July 16, 2009)
Current Issues in the Economy, Commercial Real Estate, and Real Estate Appraisals (District 7 of California Department of Transportation, March 18, 2009)
Industrial Property Trends: Los An geles County and the Inland Empire (SCCAI, 14 th Annual Summer Conference, July 31, 2008)
California School Districts’ Property and Acquisition and Disposition Update (IRWA Chapter 1, Annual Valuation Conference, April 22, 2008)
A Market in Flux: Los Angeles and Orange Counties Retail Properties (Urban Land Institute Conference, Reinventing Retail, February 14, 2008)
California Property in a Global Economy (Global Property Valuation Excellence, Appraisal Institute/RICS Americas Joint Valuation Conference, September 25, 2007)
Considering the Contributory Va lue of Interim Use Improvements (SCCAI, Special Purpose Properties Seminar, May 25, 2007)
Partial Takings in Multi-Property Appraisal Assignments (IRWA Chapter 1, Annual Valuation Conference, April 26, 2005) Appraiser’s Role in Redevelopment (Appraisal Institute, 1998) Deposition and Cross-Examination Skills (IRWA, April 1997) Entertainment Properties (Moderator, 1997)
Land Valuation in Southern California (SCCAI, 1996)
1 ©2023 CBRE, INC.
PROFILES
VALUATION & ADVISORY SERVICES
Ryan J. Dobbins
Sr Appraiser, Encino, CA
T +1 818 290 5432
E [email protected]
Professional Experience
Ryan J. Dobbins is a Sr Appraiser for CBRE's Valuation & Advisory Services (VAS). Property types which he has appraised include indust rial buildings, shopping centers, office buildings, apartment buildings, proposed lu xury high-rise condominium complexes, subdivisions, mobile home parks, hotels/motel s, healthcare properties, funeral homes, gas stations, performing arts theaters, shipping terminals and other types of waterfront property, industrial, commercial and residential acreage, agricultural land, mountainous and hillside acreage, utility and transportation corridors, and single-family residences. Major assignments of special purpose properties incl ude an offshore marine terminal, a former hospital campus designated as a historic landmark, a NASC AR Speedway, a horse racing track, an amusement park and a duty free reta il shopping outlet immediately adjacent to the busiest international border crossing in the western hemisphere.
He is experienced in providing real estate a ppraisal, analysis, and research services for many federal, state, county, and municipal ag encies. Mr. Dobbins also provides valuation services to local and national lenders, instit utional investors, corporations, law firms, and individual property owners. He has completed a wide range of specialized studies including value diminution (from both internal and exte rnal influences), mark et demand, feasibility, severance damages, assessment allocation, adaptive reuse analyses, and the valuation of partial interests including leasehold, leased fee, possessory inte rests, and minority interests. Mr. Dobbins was previously an Associate Director with Integra Realty Resources – Los Angeles.
Representative Appraisal Assignments
‒ Appraisal services for multiple federal border crossing expansion projects along the California border with Mexico. The most significant project included the appraisal of 19.01± acres of land under nine ownership entities for the San Ysidro Border Station and Reconfiguration Project. The purpose of the a ppraisal was for the acquisition of land and existing improvements to expand the busiest international border crossing in the western hemisphere, located between San Ysidro, California, and Tijuana, Mexico. ‒ Appraisal services related to an oil company which was negotiating a rental rate with the California State Lands Commission (CSLC) for th e leasing of an offshore marine terminal near El Segundo, California, and a separate as signment used for negotiating a rental rate with the CSLC for a long wharf in Richmond, California.
Pro Affiliations /
Accreditations
‒ Licensed: California Certified
General Real Estate Appraiser
No. AG029385
‒ Practicing Affiliate: Appraisal
Institute, Southern California
Chapter
‒ Member: International Right of
Way Association
Education
‒ M.S., Counseling Psychology,
California Lutheran University
‒ B.A., History, California Lutheran
University
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PROFILES
‒ Appraisal services for various entities involved in tax assessment a ppeals, of particular interest is Terranea. The assignment included the valuation of a 582-key, five-star luxury resort on the Palos Verdes Peninsula. A key component of the assignment included the identification of the fair market value of the go ing concern and the separation of business value (or non-taxable elements). Other tax assessment appeal assignments have included Auto Club Speedway (a NASCAR track); Santa Anita Park (a horse racing track) Belmont Park (a coastal amusement park); a water park; hospitals; a major brewing facility; and port terminals in Los Angeles, Long Beach, San Diego, and Richmond.
‒ Several infrastructure and right of way projects. One prominent assignment was the valuation of a subterranean subway easement beneath the 25+ acre Beverly Hills High School campus. The easement rights were needed in relation to the extension of Metro’s Purple Line which will provide service between downtown Los Angeles and the VA Hospital near Westwood. The assignment included an analysis of the property in the before and after condition as well as a complex study of severance damages and project benefits.
‒ Multiple residential subdivision appraisal assignments for lender clients, major national developers, and as parts of national portfolios. One noteworthy assignment included the appraisal of a detached, single-family resi dential estate development in Chatsworth, California. Approximately two-thirds of the devel opment had been constructed and the client was interested in determining if the remainder of the continuation of developmen t was feasible in a down turning residential market. The analysis included an in-depth market analysis, addressing absorption rates, construction costs, and forecasting future home sale prices.
Training / Courses Completed
Appraisal Institute Courses Completed:
‒ Course 410 – Uniform Standards of Professional Appraisal Practice, Part A ‒ Course 420 – Business Practices and Ethics
‒ Course 510 – Advanced Income Capitalization
‒ Course 520 – Highest and Best Use and Market Analysis ‒ Course 530 – Advanced Sales Comparison and Cost Approaches ‒ Course 540 – Report Writing and Valuation Analysis
‒ Course 550 – Advanced Applications
‒ Course 710 – Condemnation Appraising: Principles and Applications International Right of Way Association Courses Completed:
‒ Course 104 – Standards of Practice for the Right of Way Professional ‒ Course 410 – Reviewing Appraisals in Eminent Domain
‒ Course 800 – Principles of Real Estate Law
Other Courses and Seminars:
‒ Appraising the Appraisal: Appraisal Review (Appraisal Institute, 2012) ‒ Annual Litigation Seminar (Appraisal Institute, 2011-2019 and 2021) ‒ Appraising Distressed Commercial Real Estate (Appraisal Institute, 2008) ‒ Uniform Appraisal Standards for Federal Land Acquisitions (Yellow Book) (Appraisal Institute, 2007) ‒ Evaluating Commercial Construction (Appraisal Institute, 2007) ‒ Appraising Special Purpose Properties Seminar (Appraisal Institute, 2005) ‒ Contemporary Approaches to Land Seminar (Appraisal Institute, 2005) ‒ ARGUS Power User Training (Realm, 2004)
‒ Real Estate Finance (University of California, Los Angeles, 2003)