ALISON E. ROACH, MAI
, SRA
ERIC C. SCHNEIDER, MAI, SRA, AI
-GRS, R/W-AC
BENJAMIN F. KUNKEL, MAI
JONES, ROACH & CARINGELLA, INC
REAL ESTATE VALUATION CONSULTANTS
10920 VIA FRONTERA, SUITE 440
SAN DIEGO, CALIFORNIA 92127
(858) 565-2400 FAX: (858) 565-4916
www.jrcvaluation.com
ROBERT P. CARINGELLA, MAI, SRA, AI-
GRS
ROBERT N. JONES, MAI
(RETIRED)
STEPHEN D. ROACH, MAI, SRA, AI-GRS
, CDEI
Inadmissible Settlement Information/For Settlement Purposes Only
Protected by California Evidence Code § 1152 et seq.
June 2, 2022
Mr. Travis Phelps
Chief Deputy City Attorney
Office of the City Attorney
1200 Third Avenue, Suite 1100
San Diego, California 92101
Re: 101 Ash Street – Limited Scope Appraisal – Settlement/Mediation Protected
Dear Mr. Phelps:
At your request, I have performed an appraisal of 101 Ash Street under various scenarios and under
the limited scope of work outlined herein. The intended use of the appraisal is to assist the Office
of the City Attorney with valuation opinions for use in mediation and settlement discussions
involving options for this property. As set forth in the Uniform Standards of Professional Appraisal
Practice (“USPAP”), I have communicated my conclusions in this restricted appraisal report.
Because the report is presented in this format, the report may not contain supporting rationale for
all of the opinions and conclusions set forth in the report. The City Attorney is the client and the
only intended user of this report. The purpose of the appraisal is to determine the approximate
value of the fee simple interest in the property under the various scenarios described herein. The
effective date of this appraisal is December 31, 2021; most of the research for the assignment was
performed in the middle and latter parts of 2021. More recent research was performed for market
trends and renovation/abatement costs and is described briefly at the end of this report.
Market value and the value to the city (investment value) have been addressed in this report;
investment value is the value to a particular investor based on their specific criteria, and plays a
role in this assignment because the city has certain prevailing wage requirements, whereas the
market in general does not. In this case, the city could potentially sell the asset to the market, or
perform renovation work for its own benefit. The market value and investment value definitions
utilized were sourced from The Dictionary of Real Estate Appraisal, 7
th
Edition, which was
published by the Appraisal Institute in 2022.
Subject Property Identification and History
The subject property is a full city block containing approximately 60,000 square feet of land area
that is improved with an office tower built in approximately 1967. The building contains about
323,400 gross square feet (another source reports about 314,000 square feet) that had been
occupied by SDG&E for about 50 years. According to the Centre City Planned District Ordinance
(“CCPDO”), the subject’s base zoning district is identified as Core, which is a district that serves
as a high-intensity office and employment center with residential allowed. A Sun Access overlay
applies.
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Following completion of a lease-to-own agreement with the city of San Diego as lessee in 2017,
certain renovations occurred and reportedly disturbed contaminants in the building (including
asbestos) that rendered the building uninhabitable. As of the effective appraisal date, the building
was vacant. Various parties are currently engaged in attempting to settle lawsuits and/or claims
arising from this property.
Market Trends 2021
The subject is part of the traditional office product that exists downtown. One market trend is to
develop or redevelop properties for more high-tech or life science campus uses, and there is
evidence of older office towers like the subject being renovated and upgraded to attract traditional
office tenants. The subject property as renovated could take advantage of the latter trend. However,
there has yet to be substantial leasing activity for either life science campuses or renovated office
product. At this time, there may be an oversupply of renovated and new office construction.
Moreover, the subject building as renovated would still be considered a “Class B” product because
the exterior design likely cannot be materially changed. There is also evidence that conversion to
residential use over office use may be preferred.
Office towers are typically sold based on rentable building area. However, I do not have clear
records of the subject’s rentable building area. According to information from a building
measuring service (Stevenson Systems historical report), the “rentable” building area is
approximately 314,544 square feet, but this appears to be based on single tenant occupancy where
gross area is essentially also rentable area. Since there are few single tenants in the market for a
building this size, it is more likely that the property would be leased for multitenant occupancy.
As such, it was necessary to consider rentable area based on multitenant occupancy (which
excludes vertical penetrations and certain other portions of gross building area). The usable area
from the same source was reported to be 221,516 square feet for multitenant occupancy, which
was considered in estimating an approximate rentable area as discussed below.
In estimating the multitenant rentable area of the subject, I relied on one source indicating that the
subject building contains 323,400 square feet of gross building area and 67,200 square feet of
“core” area, which represents about 20.8 percent of the gross area and suggests an approximate
rentable building area of 256,200 square feet (gross building area less core area). One other method
of calculating the rentable building area that I relied on was applying a typical load factor to the
usable area; in this case, a load factor of 20 percent was used. Applying this load factor to the
usable area of 221,516 square feet equates to 265,819 rentable square feet. Absent more definitive
information at this time, I have used a rentable area of 265,000 square feet for comparison with
buildings where multitenant rentable areas are reported (allowing an “apples to apples”
comparison). It is possible that the load factor may be higher, yielding a larger rentable area. The
gross area reported at 314,544 square feet was used for comparison where gross area is relevant.
Valuation Assignment
This assignment can be described as essentially a highest and best use test involving two primary
alternative uses of the property. The first alternative would be redevelopment - to demolish the
improvements leaving a vacant site available for its highest and best use. This analysis involves
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estimating the value of the land as if vacant, and then deducting the cost of demolishing the
building. The second alternative is to perform extensive abatement and renovations to keep the
office tower. In order to safely occupy the building, abatement related to the contaminants in the
building would need to occur, and the interior office spaces and equipment then replaced.
Demolition and abatement/renovation are the two primary options for the property, and each
option necessitates opinions of approximate market value.
Scope of Work
I have relied on an investigation using comparable land sales, building sales, and leases in support
of the value of the property as if vacant and as if renovated. Prevailing rents and capitalization
rates were investigated as part of this assignment. The sales comparison approach was used to
value the subject land, and the sales comparison and income capitalization approaches were used
to value the subject as if renovated. As noted previously, the values are intended to be approximate.
As part of the valuation process, I researched the competitive market area for market data
considered similar to the subject property. The data included existing office tower sales, office
tower sales that were purchased with the intent to renovate, and land sales. I have also relied on
the construction and cost expertise of Patrick Early of Allgire General Contractors and his
involvement as an expert in this case. There was no recent history of a sale of the subject property
other than a sale in 2017 that involved the lease-to-own agreement; this was not considered
indicative of current value and was not given significant weight in my ultimate opinions. The
subject property, in its current condition, was inspected from only the surrounding streets.
As can be expected, this valuation is very sensitive to the high costs related to abatement,
demolition, and renovation; these costs can dramatically impact the financial feasibility of the
various alternatives for this property. Several inputs were necessary for this analysis as described
herein, including inputs based on information provided by Mr. Early; I necessarily have assumed
that Mr. Early’s estimates are accurate. As such, the inputs relied upon and used in this analysis
have an effect on my overall conclusions; changes in costs, and the means and methods of
renovation, can result in large changes in bottom-line numbers.
Option 1: Demolition to Produce a Vacant Site Ready for Redevelopment
Land Value
An investigation of land sales was performed, and the sales comparison approach was used to
value the subject as vacant land. The cost and income approaches were not used as these are not
relevant to the value of the land. The highest and best use was determined to be mixed-use
development, most likely with a residential element. The property includes an employment-
required overlay, but this constraint was relaxed in early 2022. While the site has very good
development potential, it is not located in a prime office or residential location. In conducting
research for this assignment, respondents recommended not demolishing the basement parking
structure. This reduces costs and provides a cost benefit in that the subterranean area is already
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Jones, Roach & Caringella, Inc.
excavated. However, saving the garage restricts the architect and the design options in order to
keep the current structural footprint and depth of garage.
The land sale data analyzed and summarized in a table presented later in this report, and escrow
activity known to the appraiser, suggest a range in land value of about $600 to $700 per square
foot of net land area. This extends to a land value of $36,000,000 to $42,000,000 for the 60,000
square foot site. This is intended to be approximate.
Demolition Costs
Demolishing a high-rise building with asbestos is exceeding costly because all hazardous material
must be removed before the building can be brought down. Demolition costs are typically quoted
separately for the abatement phase and the demolition phase. I do not have actual bids for
demolition and abatement, but I was able to garner information from other sources such as the
county of San Diego (including demolition cost estimates for two courthouses built in the 1960s),
abatement bids from opposing experts being reviewed by Mr. Early, and a rough estimate from a
source at AMG Demolition. The abatement bids range considerably, so a mid-point of the more
reasonable estimates was used with guidance from Mr. Early; the bids did not include abatement
in the core of the building, so the estimate was extrapolated to cover the additional 67,200 square
feet of the previously discussed core area. Based on this information, the total abatement and
demolition cost is about $27,760,000.
When the probable demolition cost is deducted from the land value, the result is the implied
residual value. However, when valuing the property in its “as is” condition (wherein a buyer would
be responsible for the demolition endeavor), an additional deduction for contingency and profit
would be considered reasonable. Utilizing a profit rate of 15 percent of the total abatement and
demolition cost equates to about $4,160,000 for profit/contingency, which reduces the implied
value even further. The resulting bottom-line range is presented in the table shown later in this
report.
Option 2: Remediation and Renovation to Restore Office Occupancy
The value of the property upon completion of a renovation program was estimated utilizing the
sales comparison approach and income capitalization approach to value, then deducting the cost
of renovation. The cost approach was not used as it would not be used by market participants based
on the age of the improvements and property type.
The first step taken was to estimate the value as renovated and at stabilized occupancy; once this
figure is estimated, appropriate deductions can be made to reflect the value of the asset in its “as
is” condition. Based on the two approaches utilized, the value as renovated and stabilized would
be in the range of about $310 to $350 per square foot of rentable area, which equates to
approximately $82,200,000 to $92,800,000, rounded.
According to experts in this matter, it will take approximately two years to complete the
renovation. Upon completion, the building would be vacant, so there would be time and costs
associated with absorption and reaching stabilized occupancy; given the size of the building and
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research of leasing, it is most likely that the property would be leased for multitenant occupancy
as opposed to single-tenant occupancy. Moreover, there could be some stigma with this building
related to contamination; given the existing supply of competing office product, consideration such
as lower rent or concessions may be necessary to attract tenants. Overall, these factors influence
the value of the building downward.
Using the aforementioned range of value, lease-up costs were deducted based on blend of gross
and net income for one year, which equates to roughly $7,340,000. This is a very rough estimate
since lease-up is not entirely predictable. Based on the market data contained herein and the
approaches utilized, the market value of the subject’s fee simple interest upon renovation
(replacing the existing quality of tenant improvements, less lease-up costs) was estimated to be
approximately $74,860,000 to $85,460,000. Arguably, the lease-up cost could be higher given the
possible two-year construction period; higher leasing costs would result in a lower as is value.
However, as discussed next, the cost of the renovation exceeds the value as improved, so one year
was sufficient as an approximation.
The current proposals being studied by the parties involve remediation and/or abatement of
asbestos, and reinstalling tenant improvements to the standard envisioned in recent city
renovations. Remediation/abatement can be exceedingly expensive because the existing tenant
improvements must be removed, the asbestos abated or encapsulated, and the tenant improvements
reinstalled. In this case, the core area of the building that contains approximately 67,200 square
feet will still contain asbestos. The abatement and renovation described is being evaluated by
experts in this case, including Mr. Early.
Abatement has been the recommended course by the construction expert. A range of about
$84,000,000 to $115,000,000 was being reported, but it is likely that this estimate will require
further refinement. For purposes of this analysis, I have used Mr. Early’s figure of $94,000,000
that he considered to best represent the actual total cost (with prevailing wages) that would produce
an office quality similar to that programed for the city. This total cost equates to about $355 per
square foot of rentable area, which is at the upper end of the range of value as renovated and
stabilized. In addition, profit incentive to undertake the renovation effort would be considered
reasonable, and so a profit percentage would be added, increasing the overall cost. In this analysis,
an additional 15 percent for profit indicates renovation costs and profit of over $108,000,000. As
indicated in the following table summarizing my calculations, the abatement/renovation program
involves costs that far exceed the value of the property as if renovated. This suggests that this
option is not feasible.
Conclusions
The two highest and best use scenarios that were explored included demolition of the
improvements for use as a redevelopment site, and renovation of the improvements for future
occupancy as an office tower. A summary of my value conclusions is as follows, subject to the
assumptions and limiting conditions contained herein, and noting that the costs reflect prevailing
wages (this issue is discussed next). As shown, Option 1 (demolition for redevelopment) produces
a positive value. For Option 2 (the abatement/renovation scenario) the estimated costs of
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Jones, Roach & Caringella, Inc.
abatement and renovation far exceed the building value upon completion, suggesting that this
option is not feasible.
The costs provided by Mr. Early (and considered in the preceding summary) reflect prevailing
wages because it is assumed that the city would conduct the demolition or renovation efforts for
their own benefit. If a private property owner undertook these efforts using non-prevailing wages,
the cost estimate could be about 20 to 25 percent lower according to Mr. Early. As such, the
calculations of value shown above result in what is called investment value (the value to the city),
not necessarily market value.
If non-prevailing wage estimates were used in either scenario, the bottom-line value (market value)
would increase. In the demolition scenario, if costs are, say 20 percent lower due to non-prevailing
wages, then higher positive land value results in the demolition scenario. However, the
abatement/renovation scenario remains infeasible or near breakeven.
The following table summarizes my conclusions using an adjustment of 20 percent for non-
prevailing wage figures. As shown, the demolition option continues to result in a higher overall
value compared to the renovation option. The notion of prevailing wages may play a role in
decisions about this property. For example, the renovation scenario (for city use) would require
the higher costs associated with prevailing wages, but selling the asset to a private entity for
demolition may not involve prevailing wages and would improve the bottom line.
Option 1: Demolition of Office Tower to Create a Vacant Site (Prevailing Wage)
Description Low High
Land Value $36,000,000 $42,000,000
Less Demol i ti on Cos ts
Demolition Costs $13,500,000
Abatement Costs (i ncl . TI remova l ) $11,300,000
Abatement Rel ated to Core Area $2,956,800
Subtotal $27,756,800
Profit/Contingency 15% $4,163,520
Total $31,920,320
Rounded $31,920,000 ($31,920,000) ($31,920,000)
Value Indication $4,080,000 $10,080,000
Option 2: Abatement/Renovation for Occupancy (Prevailing Wage)
Description Low High
Market Val ue As If Renovated/Stabi l i zed $82,200,000 $92,800,000
Less Lea se-Up Cos ts ($7,340,000) ($7,340,000)
Market Val ue As If Renovated $74,860,000 $85,460,000
Less
Abatement/Renovati on $94,000,000
Profit 15% $14,100,000
Total $108,100,000 ($108,100,000) ($108,100,000)
Value Indication ($33,240,000) ($22,640,000)
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Jones, Roach & Caringella, Inc.
The relevant market data are summarized in the following pages. The value estimates are intended
to be approximate given the wide range of potential cost projections and outcomes. As this time,
more precision is not possible given the nature of this property and information currently available.
Rather than providing absolute values, this analysis is more applicable for comparative analysis of
these scenarios as of the date of value.
In terms of more recent 2022 trends, vacancy rates for office space in downtown remain over 20
percent, and I did not find evidence of any significant increase in demand for or appeal of older
generation office buildings. Renovation and abatement costs, however, have increased markedly
according to Mr. Early. He reported a spike in these costs concentrated in the first quarter of 2022
leading to probable costs for the subject building of over $100 million (versus $94 million).
Another trend is that of increasing land prices, particularly for residential use, fueled by demand
for housing and bonuses for density.
Thank you for this opportunity to be of service.
Sincerely,
Robert P. Caringella, MAI, SRA, AI-GRS
AG003295
Option 1: Demolition of Office Tower to Create a Vacant Site (Not Prevailing Wage)
Description Low High
Land Value $36,000,000 $42,000,000
Less Demol i ti on Cos ts
Demolition Costs $13,500,000
Abatement Costs (i ncl . TI removal ) $11,300,000
Abatement Rel a ted to Core Area $2,956,800
Subtotal $27,756,800
Profit/Contingency 15% $4,163,520
Subtotal $31,920,320
Adjustment for Prevailing Wage 20% ($6,384,064)
Total $25,536,256
Rounded $25,540,000 ($25,540,000) ($25,540,000)
Value Indication $10,460,000 $16,460,000
Option 2: Abatement/Renovation for Occupancy (Not Prevailing Wage)
Description Low High
Ma rket Val ue As If Renovated/Stabi l i zed $82,200,000 $92,800,000
Less Lease-Up Costs ($7,340,000) ($7,340,000)
Ma rket Val ue As If Renovated $74,860,000 $85,460,000
Less
Abatement/Renovati on $94,000,000
Profit 15% $14,100,000
Subtotal $108,100,000
Adjustment for Prevailing Wage 20% ($21,620,000)
Total $86,480,000 ($86,480,000) ($86,480,000)
Value Indication ($11,620,000) ($1,020,000)
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Jones, Roach & Caringella, Inc.
Summary of Market Data
Summary of Improved Sales - As Renovated
Year Bui l t/Renov.
Address Sale Date Sel l er Price Building Area (SF) Pri ce/SF
No. APN Doc. No. Buyer Terms Percent Occupi ed Cap Rate
1 12220 Scripps Summit Drive Apr-22 Northri dge Summi t TIC - 16, LLC, et a l . $76,100,000 2000 $585.76
San Di ego 2022-164689 DWF VI Northri dge Summi t, LLC Cas h to s el l er 129,916
316-330-01, 02, 03, 04 100.0%
2 233 A Street Jul-21 Centre City Building Partnership, L.P. $10,000,000 1927 $105.26
San Di ego 2021-478349 Dan Floit, et al. Cas h to s el l er 95,000
533-433-06 90.5%
3 121 Broadway Apr-21 Spreckel s Properti es , LLC $26,500,000 1912/1982 $182.30
San Di ego 2021-296345 121 Broadwa y Property Owner LLC Cas h to s el l er 145,364
533-610-14, 15 75%
4 9095 Rio San Diego Drive Apr-21 Ri o Vi s ta Tower I II LLC $25,300,000 2005 $311.44
San Di ego 2021-290133 Ri o Vi s ta MOB, LLC Ca s h to sel l er 81,236 5.80%
438-051-13 81%
5 8954 Rio San Diego Drive Dec-19 USPF V Ri o San Di ego Offi ce, LP $74,500,000 2001 $381.80
San Di ego 2019-575916 TG19 Offi ce, LLC Cas h to s el l er 195,126 5.93%
438-051-14 94%
6 5887 Copley Drive Nov-19 Terraces CP, LLC $90,363,636 2009 $439.24
San Di ego 2019-528107 CIM OFC San Diego CA, LP Cas h to sell er 205,725
356-400-40-01 100.0%
7 451 A St/450 B St Nov-19 TKOS I, LLC $71,000,000 1984/2009 $250.19
San Di ego 2019-502432 450 B Street Inves tors Cas h to s el l er 283,786
533-435-01 80%
8 350 10th Avenue Sep-17 Diamondvi ew Tower CM-CG LLC $207,000,000 2007 $661.12
San Di ego 2017-404084 DWF V Diamondvi ew Tower, LLC Cas h to sel l er 313,103
535-563-33 96%
9 600 B St Aug-17 Multiple $109,500,000 1974/2007 $304.78
San Di ego 2017-397003 600 B Street Sa n Di ego Owner, LLC Cas h to s el l er 359,278 5.60%
534-054-03, 07, 08, 09 2017-397004, -397005 91%
10 530 B Street Aug-17 Mes a I nves tment LLC $57,700,000 1966/2014 $230.63
San Di ego 2017-383917 SFII 530B, LLC Cas h to s el l er 250,181 5.80%
534-055-03 88%
11 402 West Broadway Dec-16 RREEF America REIT I I Corp. GGGG $91,670,000 1990 $251.73
San Di ego 2016-695019 KP Emeral d Owner, LLC Ca sh to s el l er 364,160 4.30%
533-485-06-04, 05 70%
12 2520-2550 5th Avenue Nov-16 FAFC9 Owner, LLC $71,500,000 1965/2015 $442.92
San Di ego 2016-601527 Manchester Financial Fifth Avenue, L.P. Cas h to sell er 161,430
533-102-08 71%
Portfolio Sale
13 701 B Street Jun-21 Proxima 701 LLC $142,500,000 1982/2008 $238.49
534-182-03, 07 2021-457517 701 B Investment LLC Cas h to s el l er 597,521
1230 Columbia St Jun-21 Cl ay-Lexi ngton LLC $41,000,000 1990/2008 $270.97
533-404-02, 08 2021-452090 2 Col umbi a I nves tment, LLC Cas h to s el l er 151,311
401 W A St Jun-21 Broadway Lexi ngton LLC $182,500,000 1982 $307.48
533-403-10 2021-452212 1 Col umbi a I nves tment, LLC Cas h to s el l er 593,544
707 Broadway Jun-21 Proxima 707 LLC $35,000,000 1961/2015 $186.86
534-322-01 thru 08 2021-451998 707 Inves tment, LLC Cas h to s el l er 187,311
1350 6th Avenue Jun-21 Proxima 1350 LLC $19,000,000 1991 N/A
533-453-09 2021-452144 1350 Investment, LLC Ca sh to s el l er 60,000
Portfolio Jun-21 $420,000,000 1961-1991 $274.57
Cas h to s el l er 1,529,687 5.20%
67.1%
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Summary of Land Sales
Location and Sale Date Sel l er Sale Square Pri ce per Pri ce per
No. APN Doc No. Buyer Price Feet Square Foot FAR (1) FAR Foot
1 2045 Pacific Highway Jun-21 Pacifica 2045 LLC $41,960,000 58,143 $721.67 4.73 $152.58
533-214-01, 02, 03 2021-455322 KR 2045 Pacific Highway, LLC
2 800-828 East Broadway Apr-20 Minto Investment Group, LLC $19,100,000 20,000 $955.00 18.00 $53.06
534-184-03, 04, 05 2020-210392 DRI /CA 800 Broadway Property Owner, LLC
3 C Street a nd El eventh Avenue Mar-20 Columbia Parking, LP $12,000,000 20,000 $600.00 10.00 $60.00
534-195-01, 09 2020-111041 Eas t C Street Hol di ngs LLC
4 1122 Fourth Avenue Dec-19 1122 4th Ave, LLC $21,100,000 25,000 $844.00 22.28 $37.88
533-521-04, 05 2019-608307 Caydon Sa n Di ego Property LLC
5 801 Broadway Dec-19 Hall/Fish Investments, Inc. $8,160,000 15,000 $544.00 10.00 $54.40
534-323-01 2019-575915 Reef Poi nt Hos pi tal i ty LLC
6 1460 India Street Oct-19 Val ari e A. Brehm, et a l . $7,100,000 10,000 $710.00 16.70 $42.51
533-324-16 2019-468043 BPE6 LLC
7 124 Beech Street Mar-19 Kingsbarn Land Company, LLC $4,500,000 10,000 $450.00 8.00 $56.25
533-363-04, 05 2019-110013 Fi rs t and Beech Corner, LLC, et a l .
8 445 West As h Street Dec-18 Ri vergate S/D, LLC $20,300,000 30,000 $676.67 11.70 $57.83
533-402-01, 02, 03, 04, 05 2018-528275 TB Mi l ano Apartments , LLC
9 Broadway at 15th Feb-20 Jeffers on Makers Quarter, LLC $39,864,500 60,000 $664.41 6.00 $110.73
534-352-01, 02, 03, 04 2020-60724 R&V MQ Inves tment, LLC
10
901 Park Blvd/1335 Broadway
Aug-19 The Salvation Army $40,000,000 100,187 $399.25 10.00 $39.93
534-341-11; 534-342-14 2019-351467, 71 KR 901 Park, LLC & KR 1335 Broadway, LLC
11 1015 Park Boulevard Jul-19 The Salvation Army $7,750,000 18,000 $430.56 10.00 $43.06
534-206-03, -04 2019-267125 Mark S. Schmidt
12 2102 India Street Feb-20 Ja mes E. Fogerty, et a l . $5,150,000 10,000 $515.00 6.00 $85.83
533-124-05 2020-77734 2102 Indi a Street Devel opment Group LLC
13 Courthouse Commons Parcels Jun-19 County of San Diego 10.00
533-414-08, 09 2019-245030 SDCC North Block, LLC $23,901,500 60,113 $397.61
533-517-03, 04 2019-245031 SDCC Mi ddl e Bl ock, LLC $38,485,000 60,984 $631.07
533-517-02 2019-245032 SDCC South Bl ock, LLC $22,701,500 54,886 $413.61
Total
$85,088,000 175,982 $483.50
Notes:
(1) Proposed or base maximum
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ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal is subject to the following extraordinary assumptions, the use of which may have
affected the assignment results.
1. Information related to remediation, abatement, and renovation means, methods, and costs
relied upon here are assumed to be accurate.
2. This valuation is based on the extraordinary assumption that the reported building areas
are accurate.
This appraisal is subject to the following general assumptions and limiting conditions.
1. Information, estimates, and opinions furnished by others and contained in this report are
assumed to be true, correct, and reliable. A reasonable effort has been made to verify such
information; however, no responsibility for its accuracy is assumed.
2. No responsibility is assumed for matters legal in character, nor do I render an opinion as to
title, which is assumed to be held in fee simple interest as of the date of valuation unless otherwise
stated.
3. It is assumed that the property is readily marketable and free of all liens and encumbrances
except any specifically discussed in this report.
4. Photographs, plats, and maps furnished in this report (if any) are to assist the reader in
visualizing the property. No survey has been made, and no responsibility has been assumed in this
matter.
5. It is assumed that there are no legitimate environmental or ecological reasons that would
prevent continued operation at the property’s highest and best use, unless otherwise set forth in
this report.
6. A soils engineering study has not been provided for this appraisal. It is assumed that there
are no hidden or unapparent conditions such as subsoil conditions which would render the property
more or less valuable. No responsibility is assumed for such conditions or for engineering which
might be required to discover such factors.
7. This report may not be used for any purpose by anyone other than the party to whom it is
addressed without written consent.
8. Possession of this report, or a copy thereof, does not carry with it the right of publication.
Disclosure of the contents of this appraisal report is governed by the by-laws and regulations of
the Appraisal Institute. Neither all nor any part of the contents of this report (especially reference
to the Appraisal Institute or its professional designations) may be disseminated to the public
through advertising media, public relations media, news media, sales media, or any other public
means of communications without prior written consent and approval.
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101 Ash Street – Limited Scope Appraisal Page 11
Jones, Roach & Caringella, Inc.
ASSUMPTIONS AND LIMITING CONDITIONS
(continued)
9. The submission of this report constitutes completion of the services authorized. It is
submitted on the condition that the client will provide customary compensation relating to any
subsequent required depositions, conferences, additional preparation, or testimony.
10. No warranty is made as to the seismic stability of the subject property.
11. The effective date of the appraisal to which the opinions expressed in this report apply is
set forth in the report. I assume no responsibility for economic or physical factors occurring at
some later date which may affect the opinions herein stated.
12. The property was appraised as having knowledgeable ownership and competent
management.
13. I have not performed an engineering survey. Except as specifically stated, data relative to
size and area were taken from sources considered reliable, and no encroachment of real property
improvements is assumed to exist.
14. No opinion is expressed as to the value of subsurface oil, gas, or mineral rights and it is
assumed that the property is not subject to surface entry for the exploration or removal of such
materials except as is expressly stated.
15. The projections included in this report are utilized to assist in the valuation process and are
based on current market conditions, anticipated short term supply and demand factors. Therefore,
the projections are subject to changes in future conditions that cannot be accurately predicted and
could affect the future income or value projections.
16. Testimony or attendance in court or any other hearing is not required by reason of rendering
this appraisal unless such arrangements are made a reasonable time in advance.
17. A title report was not available for this appraisal. It is assumed that there are no easements
or encumbrances that would have an adverse impact on the utility unless otherwise noted in this
report. No responsibility is assumed for undisclosed items of record or any unrecorded items that
may limit the utility of the property.
18. I am not an expert in detecting hazardous waste that may or may not be present in the soil.
I have assumed that the site is free of hazardous waste. The downtown area is commonly associated
with soil contamination.
19. As used in this report, the word “inspection” means a viewing of a property and its
improvements for appraisal purposes; it should not be construed to mean a professional building
inspection in which the building structures and systems are reviewed, examined, and/or tested.
Measurements taken, if any, are for appraisal purposes only and are not to be relied upon for any
other use.
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101 Ash Street – Limited Scope Appraisal Page 12
Jones, Roach & Caringella, Inc.
ASSUMPTIONS AND LIMITING CONDITIONS
(continued)
20. By acceptance and use of this report, the user agrees that any liability for errors, omissions,
or judgment is limited to the amount of the fee charged for the appraisal. Anyone acting in reliance
upon the opinions, judgments, conclusions, or data contained herein, who has the potential for
monetary loss due to the reliance thereon, is advised to secure an independent review and
verification of all such conclusions and/or facts. The user agrees to notify me, prior to any loan or
irrevocable investment decision, of any error which could reasonably be determined from a
thorough and knowledgeable review.
21. As used in this report, the word “inspection” means a viewing of a property and its
improvements for appraisal purposes; it should not be construed to mean a professional building
inspection in which the building structures and systems are reviewed, examined, and/or tested.
Measurements taken, if any, are for appraisal purposes only and are not to be relied upon for any
other use.
22. The Americans with Disabilities Act (“ADA”) became effective January 26, 1992. I have
not made a specific compliance survey and analysis to determine whether or not the improvements
are in conformance with the various detailed requirements of the ADA. It is possible that a
compliance survey together with a detailed analysis of the requirements of the ADA could reveal
that the improvements are not in compliance with one or more requirements of the ADA. If so,
this fact could have a negative impact on the value. Since I have no direct evidence relating to this
issue, I did not consider possible noncompliance with the requirements of the ADA in estimating
value.
23. The existence of potentially hazardous material used in the construction or maintenance of
the subject improvements, such as asbestos, urea formaldehyde foam insulation, and/or toxic
waste, which may or may not be present, has reportedly been reflected by experts relied upon in
this case. The existence of such substances on or near the property have an effect on value. I am
not qualified to detect such substances.
24. The effective date of value for this appraisal is after the date in which COVID-19 was
declared to be a pandemic by the World Health Organization. The analyses and value opinions in
this appraisal are based on the data available at the time of the assignment and apply only as of the
effective date indicated. No analyses or opinions contained in this appraisal should be construed
as predictions of future market conditions or value.
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2022 Restricted Apprasial of 101 Ash
101 Ash Street – Limited Scope Appraisal Page 13
Jones, Roach & Caringella, Inc.
APPRAISER’S CERTIFICATE
I certify that, to the best of my knowledge and belief:
1. The statements of fact contained in this report are true and correct.
2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and
limiting conditions and are my personal, impartial and unbiased professional analyses, opinions, and
conclusions.
3. I have no present or prospective interest, nor bias with respect to, the property that is the subject of this
report, and no personal interest or bias with respect to the parties involved.
4. My engagement in this assignment was not contingent upon developing or reporting predetermined
results.
5. 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 of a stipulated result, or the occurrence of a subsequent event directly related to the intended use
of this appraisal.
6. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in
conformity with the Code of Professional Ethics and Standards of Professional Appraisal Practice of the
Appraisal Institute.
7. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in
conformity with the Uniform Standards of Professional Appraisal Practice.
8. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its
duly authorized representatives.
9. Eric C. Schneider, MAI, SRA, AI-GRS, R/W-AC provided significant real property appraisal assistance
to the person signing this certification. Mr. Schneider assisted with market research, valuation analysis, and
preparation of the report.
10. I have made a personal inspection of the property that is the subject of this report (exterior inspection
from surrounding streets only).
11. 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-year period immediately preceding the agreement to perform this
assignment (this is part of an ongoing assignment).
12. As of the date of this report, I have completed the continuing education program for Designated
Members of the Appraisal Institute. I have also received certification from the state of California as a Certified
General Real Estate Appraiser.
June 2, 2022
Robert P. Caringella, MAI, SRA, AI-GRS
AG003295
Date
Attachment W:
2022 Restricted Apprasial of 101 Ash
Qualifications of Robert P. Caringella, MAI, SRA, AI-GRS Addenda
Robert P. Caringella, MAI, SRA, AI-GRS
Educational Background
B.A. degree in Management Science, Economics Department,
University of California, San Diego 1987
Professional Courses Completed:
Appraisal Institute (or AIREA):
Real Estate Appraisal Principles/Valuation Procedures 1987
Capitalization Theory and Techniques - Parts A & B 1988
Case Studies in Real Estate Valuation 1989
Report Writing 1991
Standards of Professional Practice 2005, 2008, 2010, 2012, 2014, 2016, 2018
Limited Partnership and Common Tenancy Valuation 2002
Fundamentals of Separating Real/Personal Property and Intangibles 2012
Review Theory - General 2015
The Cost Approach 2020
Seminars Attended (partial list):
Appraisal Institute (or AIREA):
Business Practices and Ethics 2017
Historic Districts and Properties 2016
Uniform Appraisal Standards for Federal Land Acquisitions 2011
Appraising Unique Properties 2010
Annual Litigation Seminar 1989, 1990, 1995, 1996, 2007
Conservation Easements 2005
Planning and Land Use 1990
OREA Federal and State Laws and Regulations 1995, 1999
Attorneys, Appraisers & Real Estate 1996, 1997, 1998
Blueprint Reading 1996
Environmental Issues 1996
San Diego Economic Update 2004, 2005, 2006, 2007, 2009, 2012, 2013
Mitigation Land Update and Valuation 1997
Tax Assessment 1997
Apartment Seminar 1998, 2003, 2005
Retail Property Analysis; Single Tenant Net Leased Properties 1998;1999
Trends in R&D Market 2002
Advanced Appraisal 2004
International Right-of-Way Association:
Easement Valuation 1990
Mock Condemnation Trial 1994, 2000, 2012
Eminent Domain Case Update 1995, 1997, 2002, 2005, 2018
IRS Symposium 2006, 2018
Professional Affiliations
Member, Appraisal Institute (MAI No. 9649) (SRA and AI-GRS)
Certified under Continuing Education Program
Appraisal Institute, Admissions and Designation Qualifications Committee 2015-2017
Vice-Chair 2017
Appraisal Institute, National Finance Committee, 2015-16 and prior; 2019-2020
Jones, Roach & Caringella, Inc.
Attachment W:
2022 Restricted Apprasial of 101 Ash
Qualifications of Robert P. Caringella, MAI, SRA, AI-GRS Addenda
Appraisal Institute Education Trust - Board, 2011-2013
National Board of Directors, Regional Vice Chair 2007, Regional Chair 2008
President, San Diego Chapter of Appraisal Institute, 2005
Board of Directors, San Diego Chapter, 1999-2001, 2003-2005
Leadership Development and Advisory Council, 1999 and 2000 (National)
Chairman of Experience Review Committee, San Diego Chapter 1996-98
California Certified General Real Estate Appraiser (AG003295)
Member, International Right-of-Way Association
Board of Directors, San Diego Chapter, 1999-2003
Young Leadership Council, 1998 and 1999 (National)
Appraisal Company Experience
Co-Owner - Jones, Roach & Caringella, Inc. (formerly Jones & Roach, Inc.), Since 1996
Staff Appraiser - Jones & Roach, Inc. - 1987-1996
Testimony Experience
San Diego Superior Court
San Diego Assessor Tax Hearing
Los Angeles Superior Court
Imperial County Superior Court
US District Court, Special Master Hearing
Mediations and Arbitrations
Teaching and Education Experience
Speaker - San Bernardino Assessors Office - Effective Testimony: 2020
Speaker - CLE International - Eminent Domain, Precondemnation Damages: 2019
Speaker - Appraisal Institute - Residential “Spring Symposium”: 2018
Speaker - IRWA Seminar - “Eminent Domain and Valuation”: 2018
Guest Lecturer at UCSD, SDSU, USD, and Point Loma Nazarene University on Appraisal
Guest Instructor - USD Real Estate Class: 2017
Speaker - CLE International, Eminent Domain: 2015
Speaker - Lormon Seminar, Law of Easements: 2013
Speaker - MCLE Seminar, Eminent Domain: 2011
Speaker - Caltrans Seminar, Contaminated Properties: 2011
Speaker - Appraisal Institute Litigation Seminar So. Cal.: 2007
Speaker - IRS Symposium, Conservation Easements: 2006
Co-Creator, Co-Instructor - “Advanced Refresher”: 2004
Co-Instructor - “Rates and Ratios”, Appraisal Institute: 2003
Seminar Creator/Moderator - “The Client”: 2003
Speaker - IRS Seminar “Valuation of Fractional Interests”: 2000
Speaker - San Diego Assessor’s Seminar: 1998
Seminar Coordinator/Moderator - “Attorneys, Appraisers & Real Estate”: 1996, 97, and 98
Seminar Co-Coordinator/Moderator - Int'l Right-of-Way Assoc. “Valuation Tour”: 1996
Other Affiliations
Board of Directors - Willow Grove Educational Foundation 2008 -2013
Board of Directors - USE Credit Union, San Diego, 1999-2006
Investor Manager of LLC - $5,000,000 Loft Development, Downtown San Diego 2000
Jones, Roach & Caringella, Inc.
Attachment W:
2022 Restricted Apprasial of 101 Ash
Qualifications of Robert P. Caringella, MAI, SRA, AI-GRS Addenda
Types of Appraisals
Agricultural
Apartment Buildings
Auto Dealerships
Auto Repair
Aviation Facilities
Commercial Buildings
Contaminated Properties
Development Rights
Easements
Eminent Domain/Partial Acquisitions
Fractional Interests
Historical Appraisals
Industrial & Office Buildings
Leasehold and Leased Fee Estates
Mining - Aggregate
Mitigation Credits
Mixed-Use Properties
Notes/Loans
Mobilehome/RV Parks and Homes
Planned Communities
Research & Development Buildings
Residential Subdivisions
Retail Centers
Self-Storage Facilities
Single Family Homes and Condominiums
Single Room Occupancy Hotels
Vacant Land
View Impairment
Wetlands/Other Sensitive Habitat
Partial List of Clients
Public Agencies
California Department of Transportation
California Coastal Conservancy
California State Lands Commission
Centre City Devel. Corp. (Civic San Diego)
Chula Vista Redevelopment Agency
City of Chino Hills
City of Dana Point
City of Escondido
City of National City
City of Oceanside
City of Redlands
City of San Diego
County of San Diego
Del Mar Union School District
IRS
Metropolitan Transit System (MTS and MTDB)
MiraCosta Community College District
Oceanside Redevelopment Agency
Otay Water District
Regents of the University of California
Resolution Trust Corporation (RTC)
San Diego Association of Governments
San Diego City College District
San Diego County Water Authority
San Diego Unified Port District
Solana Beach School District
Southeastern Economic Development Corp.
U.S. Department of Justice
Wildlife Conservation Board (California)
Lenders and Developers
Ayres Land Company
Bank of America
Bank of California
Barratt American
Brookfield Homes
Buie Corporation
California Transportation Ventures
Citicorp Acceptance Company
Coast Federal Bank
Column Financial
Continental Bank
Downey Savings
D.R. Horton
First Interstate Bank
Garden Communities
Great American Bank
Home Savings of America
HomeFed Bank and Home Capital Dev. Corp.
KB Home
Leisure Technology
Nexus Development Corporation
Pardee Homes
McMillin Communities
San Diego National Bank
Sherritt Development Services
Union Bank
US Bank
Jones, Roach & Caringella, Inc.
Attachment W:
2022 Restricted Apprasial of 101 Ash
Qualifications of Robert P. Caringella, MAI, SRA, AI-GRS Addenda
Wells Fargo Bank
Western National Properties
Western Pacific Housing
Corporations, Attorneys, and Individuals
American Assets
Anderson, Mann & Hilbert, LLP
ARCO Petroleum Products Co.
Bartz & McCarberg, LLP
Berger & Norton
Best, Best & Krieger LLP
Bob Baker Enterprises
Brobeck, Phleger & Harrison
Burger King Franchisee
Burke, Williams & Sorensen, LLP
Coldwell Banker Realty Advisory Services
Daley & Heft
Endeman, Lincoln, Turek & Heater
English & Gloven
Epsten & Grinnell
Ford Motor Company
Fraser Engineering, Inc.
Golden Eagle Insurance Company
Golub & Morales
Gordon & Rees
Gray, Cary, Ware & Friedenrich
Greenberg Traurig
Haight, Brown & Bonesteel
Hearthstone Advisors
HomeFed Corporation
Insurance Company of the West
Irell & Manella, LLP
John H. Reaves, Attorney at Law
Judge Robert C. Thaxton (retired)
Lempres & Wulfsberg
Liberty Mutual Insurance Company
McKenna & Cuneo
McKenna Long & Aldridge, LLP
Meisenheimer Herron & Steele
Morris, Polich & Purdy
Olmstead, Hughes & Garrett
Orrick, Herrington & Sutcliffe, LLP
Palmieri Tyler Weiner Wilhelm & Waldron
Procopio Cory Hargreaves & Savitch
Rick Engineering Company
Ryals & Associates
San Diego Gas & Electric Company
Seltzer Caplan McMahon Vitek
Sheppard, Mullin, Richter & Hampton, LLP
Sierra Club Legal Defense Fund
Silldorf, Burdman, Duignan & Eisenberg
Solomon Ward Seidenwurm & Smith, LLP
Sullivan Wertz McDade & Wallace
Texaco Oil
Thorsnes, Bartolotta, McGuire & Padilla
Trust Company of the West
Trust for Public Land
UETA
Walmart
Withers Bergman
Jones, Roach & Caringella, Inc.
Attachment W:
2022 Restricted Apprasial of 101 Ash
