HODGES LACY & ASSOCIATES, LLC - 2014

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4. STATF,MFNT OF UNDERSTANDING & WORK PLAT HLA's standard methodology and approach in appraising the fixtures and equipment of businesses situated on properties to be acquired by public agencies are as follows: • Upon commencement of the engagement, the real estate appraiser is contacted to discuss their approach to the property, as well as ours, in order to avoid duplication of compensation. • At the earliest, as well as most appropriate time (which involves coordination with the City), contact letters are sent to the business owners to introduce ourselves, explain our function in the potential acquisition process and encourage their involvement in the appraisal process. Particularly as it pertains to identifying the fixtures and equipment owned and /or installed by the business. Follow -up calls are placed to arrange field visits. • Upon arrival on -site, we interview the business owner and /or management regarding die history of the business and the tangible assets owned and request a tour of the facility. • The bulk of our on -site visit consists of preparing an inventory of the trade fixtures and movable equipment which we separate in our reports to assist in compensation versus relocation issues. • Once the field work is complete we utilize generally accepted valuation methodology including primarily the cost approach and the market approach, to estimate the replacement cost new. fair market value in place and liquidation value of the appropriate items owned by each business. • Finally, a narrative report is produced, including pictures. Before the report is delivered, we contact the real estate appraiser again to discuss our improvements list as a final reconciliation to avoid duplication of compensation. • Additionally, IiLA will coordinate appraisal activities with the City's other consultants, representatives and legal counsel during the appraisal process. Hodges Lacey & Associates is a partnership of two, very experienced appraisers and we are very flexible and highly mobile in terns of availability and responsiveness to small and large projects alike. Hodges Lacey & Associates, LLC's primary focus of business is providing fixtures and equipment appraisals for property acquisitions by public agencies. Within our appraisals, we separate improvements pertaining to the realty from movable equipment to better serve the client as well as the other consultants involved in the assignment. We also make great efforts to ascertain the ownership of assets. Aside from holding the designations of Accredited Senior Appraiser by the American Society of Appraisers (Machinet)! & Technical Specialties), we have many years of experience in the niche environment of working within the context of eminent domain and the complicated nuances of public agency property acquisitions. Michael Lacey's experience in real estate appraisal is a great asset to our technical knowledge when working in conjunction with real estate appraisers and sometimes needing to appraise major improvements on more complicated business occupied properties. We believe in proactive contact with all consultants involved in our assignments whether for technical interaction or the availability to be of assistance due to our intimate knowledge of the site.