AN APPRAISAL OF Acre Residential Site Northwest Corner Pleasant View Road & Gaar Road Richmond, Indiana 47374

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1 AN APPRAISAL OF 3.75 Acre Residential Site Northwest Corner Pleasant View Road & Gaar Road Richmond, Indiana 47374

2 American United Appraisal Company, Inc. Real Estate Appraisers Jay E. Allardt, SRA August 4, 2015 Stephen B. Parmerlee Darrin R. Hollensbe Daniel D. Tudor Tina L. Hoopingarner Jay D. Allardt INVOICE Ms. Karen Scalf, Chief Financial Officer Richmond Community School Corporation 300 Hub Etchison Parkway Richmond, Indiana RE: 3.75 Acre Residential Homesite Northwest Corner Pleasant View Road & Gaar Road Richmond, Indiana Appraisal services for referenced property. File#C150709B FEE: $ Please Remit to: American United Appraisal Co., Inc. 211 S. Walnut St. Muncie, IN Due in 30 Days AUA Federal ID # Thank you

3 American United Appraisal Company, Inc. Real Estate Appraisers Jay E. Allardt, SRA Stephen B. Parmerlee Darrin R. Hollensbe Daniel D. Tudor Tina L. Hoopingarner Jay D. Allardt August 4, 2015 Ms. Karen Scalf, Chief Financial Officer Richmond Community School Corporation 300 Hub Etchison Parkway Richmond, Indiana RE: 3.75 Acre Residential Homesite Northwest Corner Pleasant View Road & Gaar Road Richmond, Indiana Dear Ms. Scalf, At your request, a market value appraisal has been completed on the above referenced property. The purpose of this analysis is to estimate the market value which will be used as a basis for making financial decisions including a possible sale of the property. This Restricted Appraisal Report is subject to the Assumptions, Limitations and comments which are a part of this report. This appraisal report has been prepared in accordance with the minimum generally accepted appraisal standards as set forth by the Appraisal Subcommittee of the Federal Financial Institution Examination Council and the Standards of Professional Appraisal Practice of the Appraisal Institute. This appraisal was prepared by the undersigned. This Restricted Appraisal Report is intended to comply with the reporting requirements set forth under Standard Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Restricted Appraisal Report. As such, it presents no discussions of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser s opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser s files. The information contained in this report is specific to the needs of Richmond Community Schools and is intended for this client only. The appraiser is not responsible for the unauthorized use of this report.

4 No responsibility has been assumed for matters legal in nature, nor has any opinion on title been rendered and this appraisal assumes marketable title. Liens and encumbrances, if any, have been disregarded and the property was appraised as though free of indebtedness. Employment and compensation for making this report are in no way contingent upon the value reported and I certify that I have no present or future interest in the subject property. The undersigned, does hereby certify that to the best of his knowledge and belief, the statements contained in this analysis, and upon which the opinions expressed herein are based, are correct, subject to the limiting conditions. Based on the analysis contained herein, the appraiser has concluded that the market value of the Fee Simple Interest of the subject property as of July 29, 2015 was: TWENTY THREE THOUSAND SEVEN HUNDRED DOLLARS $23, THIS LETTER MUST REMAIN ATTACHED TO THE REPORT, WHICH CONTAINS 23 PAGES PLUS RELATED EXHIBITS, IN ORDER FOR THE VALUE OPINION SET FORTH TO BE CONSIDERED VALID. The value conclusion assumes a marketing period of 6 to 15 months. Should you have any questions concerning the contents of this letter or the attached report, please do not hesitate to contact me. Respectfully submitted, Jay E. Allardt, SRA Indiana Certified General Appraiser #CG

5 This Restricted Appraisal Report which is intended to comply with the reporting requirements set forth under; 1) the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and, 2) Standards Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice (USPAP) for a Restricted Appraisal Report. As such, it presents no discussion of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser s opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser s file. The depth of discussion contained in this report is specific to the needs of the client and for the intended use stated below. The appraisers are not responsible for unauthorized use of this report. CLIENT: Ms. Karen Scalf, Chief Financial Officer Richmond Community School Corporation 300 Hub Etchison Parkway Richmond, Indiana APPRAISERS: Jay E. Allardt, SRA Indiana Certified General Appraiser #CG American United Appraisal Co., Inc. 211 South Walnut Street Muncie, Indiana SUBJECT: 3.75 Acre Residential Homesite Northwest Corner Pleasant View Road & Gaar Road Richmond, Indiana

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7 PURPOSE OF APPRAISAL: The purpose of this appraisal is to provide the appraiser s best estimate of the market value of the subject real property as of July 29, Market value is defined by the federal financial institutions regulatory agencies as follows: Market Value means the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1. buyer and seller are typically motivated; 2. both parties are well informed or well advised, 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 consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale INTENDED USER: Richmond Community Schools INTENDED USE OF REPORT: For the sole and exclusive use in considering a sale or disposition of the subject property. INTEREST VALUED: Fee Simple EFFECTIVE DATE OF VALUE: July 29, 2015 DATE INSPECTED: July 29, 2015 DATE REPORT COMPLETED: August 4,

8 OWNER OF RECORD: According to Wayne County records, the subject property is titled as follows: LEGAL DESCRIPTION: Richmond Community Schools A survey or legal description was not provided. Based on county records, the subject property is described as a Part of the Northeast Quarter of Section 28, Township 14 North, Range 1 West, Wayne Township, Wayne County, Indiana. Parcel # PREVIOUS TRANSFERS OF OWNERSHIP: There have been no recorded transfers of ownership of the subject property in the three year period preceding the effective date of this appraisal assignment. The subject property has not been offered for sale in the previous three year period. 4

9 SCOPE OF APPRAISAL: In completing this appraisal assignment, the appraiser: Discussed the need for appraisal services with Karen Scalf, Chief Financial Officer for the Richmond Community School Corporation. Inspected the subject property from surrounding public roadways on July 29, Obtained a GIS map from the Beacon GIS System as well as a property record card for the subject property. Obtained zoning information from the City of Richmond. Gathered available sales information for residential and rural homesites from the following sources: o appraiser s office files o Richmond MLS system o Indiana Regional MLS system o Wayne County Assessor disclosure records Developed the Sales Comparison Approach in estimating the market value of the subject property The Sales Comparison Approach is considered to be the only applicable indicator of value for the subject property. Furthermore, small residential sites, such as the subject are typically purchased for development by the owner and are not leased. For this reason, the Income Approach has not been developed in this appraisal assignment. The appraisers believes the Sales Comparison Approach will provide a credible estimate of market value for the subject property. This appraisal report is intended to comply with the Uniform Standards of Professional Appraisal Practice (USPAP) for a Restricted Appraisal Report. 5

10 LOCATION DESCRIPTION The subject property is located in the northeastern quadrant of Wayne Township and is approximately 1.75 miles northeast of Richmond s Central Business District. The area surrounding the subject property consists primarily of single family residential properties that are largely within a value range of $80,000 to $175,000. The subject property has good access to the City of Richmond and Interstate 70 via Indiana State Road 227 which is located about one-tenth of a mile west of the subject property. In terms of recreation, the subject property is conveniently located to Middle Fork Reservoir which is less than ½ mile north of the subject property. There are also some agricultural land uses near the subject property to the south and east. The former Pleasant View School across from the subject property has been utilized as a religious facility for the past 8 to 10 years. 6

11 SITE DESCRIPTION Dimensions and Shape The subject site is rectangular in shape and is shown on the GIS map above. According to the GIS system, the site has 495 of frontage on Pleasant View Road and 330 feet of frontage on Gaar Road. The site accumulates a total area of 3.75 acres. Topography and Drainage The subject site is relatively level and appears to be adequately drained to the south. The subject property is not located within a federal identified flood hazard zone. Availability and Description of Utilities Utilities available to the subject site include electricity, natural gas, water, and telecommunications. Sewage disposal in this area is accomplished by private septic system. 7

12 Street and Other Public Improvements Both Pleasant View Road and Gaar Road are two lane asphalt surfaced roadways. There is also an additional asphalt area which extends on to the subject property from Pleasant View Road that was previously used for buses or school traffic when the Pleasant View School to the south was open. Easements and Encroachments The appraiser has assumed easements for public utilities and roadway purposes along both the south and east property boundaries. It is assumed that there are no other easements or encroachments impacting the subject property. Environmental Conditions No environmental audit has been provided to the appraisers. The appraisers are unaware of all past uses of the subject site or the surrounding property. This appraisal assignment is being completed under the assumption that there are no environmental conditions that would have an adverse impact on the value, marketability, habitability or ability to obtain mortgage financing for the subject property. 8

13 SUBJECT PROPERTY PHOTOGRAPHS View of Subject Property Looking Northwest from Pleasant View Rd & Gaar Rd View Looking West on Pleasant View Rd Subject on Right 9

14 SUBJECT PROPERTY PHOTOGRAPHS View Looking North on Gaar Rd from Pleasant View Road Subject on Left View of Subject Property from Northeast Corner Looking Southwest 10

15 SUBJECT PROPERTY PHOTOGRAPHS View of Subject Property from Southwest Corner Looking Northeast 11

16 TAXES AND ASSESSMENTS: The subject property was not assessed prior to March 1, The March 1, 2014 assessment for the subject property is $50,700. However, the property shows as being exempt due to ownership and usage by a public school. ZONING: The City of Richmond Unified Development Ordinance shows that the subject property is zoned R-2 Residential. R-2 is designated as a medium density, single family residential district. Permitted uses include single family detached dwellings, home businesses, and public and governmental uses. DESCRIPTION OF IMPROVEMENTS There are no building or site improvements on the subject property. HIGHEST AND BEST USE As Vacant: Purchase by adjoining property owners or purchase for construction of a single family residence. SALES COMPARISON ANALYSIS The appraiser has attempted to find sales of suburban-rural parcels with residential or agricultural zoning which have sold in the past several years. The typical unit of comparison for properties of this type is sale price per acre of gross site area. For comparison purposes, the subject site has an area of 3.75 acres. The comparable sales that have been considered are presented on the following pages. 12

Sale #1 Location 4258 SR 121, Richmond, IN Seller

$16,500 Sale Date 11/10/2014 Gross Site Area 1.

R2-Residential Intended Use Unknown Comments

17 Sale #1 Location 4258 SR 121, Richmond, IN Seller Group 706 LLC Buyer Rao Polavarapu Sale Price $16,500 Sale Date 11/10/2014 Gross Site Area acres Sale Price/Acre $10,293 Zoning R2-Residential Intended Use Unknown Comments Purchased by adjoining property owner; smaller than subject, has city water available 13

Sale #2 Location N/S SR 38, 1/3 mi W of Round Barn Rd,

& Susan R Jay Sale Price $29,675 Sale Date 12/2/2014

935 acres Sale Price/Acre $5,000 Zoning A1-Agricultural

18 Sale #2 Location N/S SR 38, 1/3 mi W of Round Barn Rd, Richmond, IN Seller Railsback Family LLC Buyer Douglas S & Susan R Jay Sale Price $29,675 Sale Date 12/2/2014 Gross Site Area acres Sale Price/Acre $5,000 Zoning A1-Agricultural Intended Use Single family residence Comments Located north of Richmond, no public utilities available 14

11 acres Sale Price/Acre $5,839 Zoning A1-Agricultural

19 Sale #3 Location Murphy Dr., W of Park Rd & S of Wallace Rd, Richmond Seller David R & Coryn S Hooper Buyer Kevin E & Lori A Johnson Sale Price $24,000 Sale Date 11/5/2012 Gross Site Area 4.11 acres Sale Price/Acre $5,839 Zoning A1-Agricultural Intended Use Residential development Comments Paved street extending west from Cart Rd, most homes built within past 20 years 15

Sale #4 Location N side Leadline Rd, E of Mattie Harris Rd,

& Lauralee Hites Sale Price $25,900 Sale Date 6/4/2015 Gross

748 acres Sale Price/Acre $5,455 Zoning A1-Agricultural

20 Sale #4 Location N side Leadline Rd, E of Mattie Harris Rd, Centerville Seller Michael A & Ruth M Toschlog Buyer Harold M & Lauralee Hites Sale Price $25,900 Sale Date 6/4/2015 Gross Site Area acres Sale Price/Acre $5,455 Zoning A1-Agricultural Intended Use Residential development Comments Rural area, other similar homesites in the area, Centerville School District 16

21 Comments Sale 1 is the only sale that included a public water utility like the subject property. However, this particular sale was smaller in size than the subject property. It is estimated that the value of the water utility is approximately $4,000. Sale 3 is closest to the subject in terms of overall size. Sale 3 may be a slightly superior location as the site is surrounded by other recently constructed homes. Based on the sales data, I have concluded the subject site to have a market value equivalent to $5,250 per acre and to be increased by the estimated value of the water utility which is $4,000. The calculations for market value are shown below $5,250/acre = $19,700 (rounded) Value of Water Utility $ 4,000 Total Indicated Value $23,700 17

22 RECONCILIATION AND FINAL STATEMENT OF VALUE The Sales Comparison Approach is considered to be the only applicable indicator of market value for the subject property. Based on the limited amount of sales data and properties currently offered for sale, I have concluded the subject property to have a market value as of July 29, 2015 was: TWENTY THREE THOUSAND SEVEN HUNDRED DOLLARS $23, The value conclusion assumes a marketing period of 6 to 15 months. 18

23 ASSUMPTIONS AND LIMITING CONDITIONS: 1. This is a Restricted Report which is intended to comply with the reporting requirements set forth under Standard Rule 2-2(b) of the Uniform Standards of Professional Appraisal Practice for a Restricted Appraisal Report. As such, it does not include discussions of the data, reasoning, and analyses that were used in the appraisal process to develop the appraiser s opinion of value. Supporting documentation concerning the data, reasoning, and analyses is retained in the appraiser s 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 appraiser is not responsible for unauthorized use of this report. 2. No responsibility is assumed for legal or title considerations. Title to the property is assumed to be good and marketable unless otherwise stated in this report. 3. The property is appraised free and clear of any or all liens and encumbrances unless otherwise stated in this report. 4. Responsible ownership and competent property management are assumed unless otherwise stated in this report. 5. The information furnished by others is believed to be reliable. However, no warranty is given for its accuracy. 6. All engineering is assumed to be correct. Any plot plans and illustrative material in this report are included only to assist the reader in visualizing the property. 7. It is assumed that there are no hidden or unapparent conditions of the property, subsoil, or structures that render it more or less valuable. No responsibility is assumed for such conditions or for arranging for engineering studies that may be required to discover them. 8. It is assumed that there is full compliance with all applicable federal, state, and local environmental regulations and laws unless otherwise stated in this report. 9. It is assumed that all applicable zoning and use regulations and restrictions have been complied with, unless a nonconformity has been stated, defined and considered in this report. 10.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 estimate contained in this report is based. 11.Any sketch in this report may show approximate dimensions and is included to assist the reader in visualizing the property. Maps and exhibits found in this report are provided for reader reference purposes only. No guarantee as to accuracy is expressed or implied unless otherwise stated in this report. No survey has been made for the purposes of this report. 19

24 12.It is assumed that the utilization of the land is within the boundaries or property lines of the property described and that there is no encroachment or trespass unless otherwise stated in this report. 13.The appraiser is not qualified to detect hazardous waste and/or toxic materials. Any comment by the appraiser 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 property. The appraiser s value estimated is predicated on the assumptions that there is no such material on or in the property that would cause a loss in value unless otherwise stated in this report. No responsibility is assumed for any environmental conditions, or for any expertise or engineering knowledge required to discover them. The appraiser s description and resulting comments are the result of the observations made during the appraisal process. 14.Unless otherwise stated in this report, the subject property is appraised without a specific compliance survey having been conducted to determine if the property is or is not in conformance with the requirements of the Americans with Disabilities Act. The presence of architectural and communications barriers that are structural in nature that would restrict access by disabled individuals may adversely affect the property s value, marketability or utility. 15.Any proposed improvements are assumed to be completed in a good workmanlike manner in accordance with the submitted plans and specifications. 16.The distribution, if any, of the total valuation in this report between land and improvements applies only under the stated program of utilization. The separate values for land and buildings must not be used in conjunction with any other appraisal and are invalid if so used. 17.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 the appraisers, and in any event, only with proper written qualifications and only in its entirety. 18.Neither all nor any part of the contents of this report (especially any conclusions as to value, the identity of the appraisers, or the firm with which the appraisers are connected) shall be disseminated to the public through advertising, public relations, news sales, or other media without prior written consent and approval of the appraiser. 20

25 CERTIFICATION: I certify that, to the best of my knowledge and belief: The statements of fact contained in this report are true and correct. 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. 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. I 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 (3) year period immediately preceding acceptance of this assignment. I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment. My engagement in this assignment was not contingent upon developing or reporting predetermined results. My 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 or a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 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 & Standards of Professional Appraisal Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. I have made a personal inspection of the property that is the subject of this report. No one provided significant real property appraisal assistance to the person signing this certification. As of the date of this report, I, Jay E. Allardt, SRA, has not completed the continuing education program of the Appraisal Institute. 21

26 Based on the analysis contained herein, the appraiser has concluded that the market value of the Fee Simple Interest of the subject property as of July 29, 2015 was: TWENTY THREE THOUSAND SEVEN HUNDRED DOLLARS $23, Jay E. Allardt, SRA Indiana Certified General Appraiser #CG

27 ADDENDA Property Record Card Appraisers Resume Appraisers License 23

RESTRICTED APPRAISAL REPORT

Restricted Use Appraisal Report Thomas J. Schulte & Associates Page #1 RESTRICTED APPRAISAL REPORT SUBJECT ASSIGNMENT Property City: Zip Code: County: Legal Description: Assessor's Parcel #: Tax Year: