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Old 04-30-2008, 03:06 AM
cdw20 cdw20 is offline
Join Date: Mar 2008
State: Ohio
Professional Status: Certified Residential Appraiser
Posts: 1
Default Rural Vacant Land with Cell Tower

Can a Rural Vacant Land property with no zoning & a cell tower being built on it be appraised as residential vacant land? I have a 1 ac parcel,with a cell tower being built & a monthly lease for a total of 5 years and I'm not sure of exactly how I should handle it. The property is rural, no zoning, etc. Should I refer it to a commercial appraiser or do it as vacant land and treat the lease seperately or what? Please HELP!!
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Old 04-30-2008, 07:13 AM
SMF SMF is offline
Join Date: Oct 2007
State: Virginia
Professional Status: Certified General Appraiser
Posts: 138

You should probibly refer this appraisal to a commercial appraiser or at the least get someone in your area that is competant that is willing and can help you. Properties with cell towers are a very specific type of appraisal and comps will be far and few between.

good luck
Old 04-30-2008, 07:15 AM
Richard Carlsen's Avatar
Richard Carlsen Richard Carlsen is offline
Join Date: Jan 2002
Location: Tip of the Mitt: Northern Michigan
State: Michigan
Professional Status: Licensed Appraiser
Posts: 8,372

Sure it can. I've done it as well as doing a 20 acre parcel with a nice pre-HUD mfg and a tower generating $3600/year in lease payments.

Let me use the 20 acre improved parcel as an example. The parcel was two sq 10's extending back from the road. The tower sat on the rear 10 and what with guy wires etc., took up nearly all of that back 10 acres. So in essence, the leasehold rights of the tower owner took the back 10 acres out of the site for all but a small bit of owner utility. I then valued the house and the remainder 10 acres. For the back 10 acres, I used the current lease payments plus the agreed payments and increases and calculated the present value of that lease. Strangely enough, the results were nearly identical for the income value as for the value of the front 10 acres as unimproved. I put the two together with a slight discount for loss of some utility (they could still deer hunt under the tower but that was about it) and stated my estimate of value.
Now it's time to go fishing and ride the bike........
Old 04-30-2008, 04:23 PM
CBBoston CBBoston is offline
Join Date: Jan 2008
State: Massachusetts
Professional Status: General Public
Posts: 500

Richard is right on. Finding sale comps is extremely challenging and the income approach is really the only way to do it. You might want to talk with other property owners to see what prevailing rent is. Here in rural MA the tower rentals I've encountered are from $20k to $30k a year on raw land. Things get a bit more complicated if the tower is on an existing structure. Cap rates are in the 8-10% range. But I wouldn't hang my hat on that.
Old 04-30-2008, 04:24 PM
Terrel L. Shields's Avatar
Terrel L. Shields Terrel L. Shields is offline
Join Date: May 2002
Location: Springtown, AmeRica
State: Arkansas
Professional Status: Certified General Appraiser
Posts: 40,713

If you are appraising only a 1 acre tract, then you are appraising a non-residential property. It is not "vacant". It is a commercial tower site. SO...are you appraising the Fee Simple (all of it)? The leasehold (tower)? or the Leased Fee (land)?....
If the leased fee (the owner's part) then the lease needs to be DCF'd over the term of the lease and the reversion value to see its "value". This is an income assignment and "comps" are likely not going to be much help unless there are some close.
"Bigamy is having one wife too many. Monogamy is much the same." Oscar Wilde
Old 04-30-2008, 05:42 PM
Mike Boyd Mike Boyd is offline
Join Date: Jan 2002
Location: Santa Rosa, CA
State: California
Professional Status: Retired Appraiser
Posts: 11,822

We have cell towers going up in several locations. I have been keeping my fingers crossed that I do not get an assignment such as this. Neighbors are very sensitive to phony health issues regarding electro-magnetic fields created by the towers and the electronics. I think I would turn down such an assignment, not because I could not do it but because the use of these towers will likely end up in court and I no longer have patience for these kind of people.
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