I'm re-appraising a mostly shell condition older mixed-use warehouse/office with an illegal apartment unit on the 2nd floor. This is a user property and market sales of similar shell properties were analyzed and a value of $320,000 was reconciled to last May (6 months ago). The comparable properties were purchased by users and readapted for other commercial or industrial uses. The lender of the subject is asking for a new appraisal as the property is under contract for $270,000 in a short sale situation. My search of new sales comparables resulted in three new sales which mostly supports the same value of $320K. There is one REO sale at the bottom of the indicators, which is attributed to the sellers (bank owned via Trustee’s Sale) motivation to reduce financial loss. The MAI which I contract with typically insists we reconcile to a pending sales price. I don’t generally agree with this, unless market data also supports it – but he would absolutely never value above a contract sales price. He feels that this pending short sale price is reflective of market, which I do not agree with. This property has been listing numerous times over the past five years. The seller is way under water with the lender and foreclosure is eminent. I appreciate any comments on why this sale should or shouldn’t be construed as a pending market transaction. I also appreciate comments on why lenders re-appraise just prior to a short sale or prior to a trustee’s sale at foreclosure. I believe it sets a baseline for loss write offs or what they bid at a trustee’s sale. Many thanks.