Eminent Domain can involve a full taking of the property or a partial taking.
Full Taking
The valuation of a full taking is straight-forward, you just appraise the property as it were a sale or a re-finance. Most any appraiser can do this.
Partial Taking
When a taking is less than the entire property, it is called a partial taking. To value a partial taking, two appraisals are required; one that values the property Before Taking and the other that values the property After Taking.
Then the appraisal must address any damages to the After property that must be remedied to make the property useful, called Severance Damages. For example, taking parking spots that should ne replaced.
Finally, if there are any Temporary Construction Easements that hinder use of the property during construction, these must be valued. An example is the use of part of your parking lot to store construction materials and park equipment,
Severance Damages
These may be anything from replacing landscaping or pavement to reconstructing part of a building
Temporary Construction Easements
Sometimes these easements result is a compensable loss of the use of the property for the duration of the easement.
o Temporary Construction Easement: Taking the temporary right and easement for removing a portion of a building and matching the remaining land of the Condemnee to the new construction … in accordance with the standard practice of highway construction.
- The easement for purposes of razing a portion of a building most likely restricts the use of the remaining building and is compensable. The compensation should be the present value of the buildings’ lost rent stream, which is greater than the lands’ lost rent stream.
o Temporary Slope Easement: Taking the temporary right and easement to construct and maintain slopes and embankments beyond the limits of the fee taking at such an angle as will hold the highway and material in the slopes in repose against ordinary erosion.
- The slope easement is at most a minor inconvenience and usually not compensable.
o Temporary Driveway Easement: Taking the temporary right and easement to construct or reconstruct the driveway on land of the Condemnee, for matching the driveway to the road.
- The driveway easement, IF it impairs access and affects the business, is compensable based on the lost business. I did hear one opinion that the law says a driveway easement cannot impair ingress or egress and is not compensable.
A typical appraisal table of contents will look something like this
PART I – INTRODUCTION
Letter of Transmittal
Summary of Salient Facts & Conclusions
Assumptions and Limiting Conditions
Certification of Appraisal
Scope of Work
Property Identification
Appraisal Parameters
State and Regional Overview
City and Neighborhood Data
Location Map
Neighborhood Map
PART II – FACTUAL DATA
Legal Description
Property Description
Aerial View
Photographs
Topographical Map
Site Plan
Assessments and Taxes
Tax Map
Zoning
Zoning Map
Flood Map
PART III – ANALYSES AND CONCLUSIONS – BEFORE TAKING
Highest and Best Use – Before Taking
Sales Comparison Approach
Income Approach
Correlation and Final Value Estimate – Before the Taking
PART IV – DESCRIPTION OF TAKING
Description of Taking
Site Plan – Taking
PART V –ANALYSES AND CONCLUSIONS – AFTER TAKING
Highest and Best Use – After Taking
Property Description – After Taking
Site Plan – After Taking
Sales Comparison Approach
Income Approach
Severance Damages
Temporary Construction Easement
Part VI – TAKING ANALYSIS
Correlation and Final Value Estimate
PART VII – EXHIBITS AND ADDENDA
Definitions
Appraisal Process- Valuation Analyses
Legal Documents
Comparable Sales Maps and Data
Engagement Letter
Qualifications of Appraiser