Auto Salvage Yards

[philicia lloyd]

The assigment calls for a valuation of an Auto Salvage Yard.
Not the Business Just the yard. I have warehouse comps, currently searching for Auto salvage sales in the Southeast.
I am also looking for land lease sales.
Any other suggestions?



[I edited to correct the spelling in the Topic Title line.]

 

[Daniel Picou]

I think I would get away from this one. Sorry no help here. Dan

 

[Ramon Tate]

Originally posted by philicia lloyd@Apr 7 2005, 07:28 PM
The assigment calls for a valuation of an Auto Salvage Yard.
Not the Business Just the yard. I have warehouse comps, currently searching for Auto salvage sales in the Southeast.
I am also looking for land lease sales.
Any other suggestions?

By definition, auto salvage yards are contaminated sites, (oil, gas, transmission fluid, discarded batteries, asbestos brake pads, CFC's in auto AC systems, etc.). I hope you are familiarized with the special environmental regs, State and Federal, applicable to those sites. If not, you need to associate yourself with someone who has dealt with them before. If you're not familiar with the environmental issues, you're walking in an appraisal minefield..... i.e. you don't know what you don't know...

 

[H.B. Userman]

I don't think it is always best to advise people away from assigments which are complex and unfamiliar. T.S. Eliot quoted "Only those who will risk going too far can possibly find out how far one can go." I love this quote and live by it. If nobody ever learned anything new, nobody would know anything.

By all means, the USPAP compentency provision is always always paramount in every assignment. But I think this USPAP rule scares too many people away from opening new doors. I would heed the previous advice to contanct someone experienced in this realm, but don't throw away the assignment. New experiences only makes the brain stronger, it is a muscle and we must excercise it or it will get weak. Try to find someone to help you, notify the client of your intentions, document everything, disclose everything and learn as much as possible, because when it is all said and done, you will have added something valuable to your resume. There is a pile of money waiting to be made in the environmental sector of valuation, but only the well-seasoned experts see it.

My advice:
Seek out a mentor and get a taste of what it is all about, then decide if you like it or not. If you turn down the assignment, you may regret not learning something new.

 

[Walter Kirk]

Are there any zoning or regulatory issues that impact on value? Is the land more valuable since it can legally be used as a salvage yard? Is it less valuable because of contamination? Will the sale of the subject force environmental clean up? This is a very complex assignment and you must associate yourself with an appraiser experienced in such assignments.

 

[robkline]

In Maryland auto salvage years are typically permitted in only the most intensive industrial zoning classes either as uses permitted by right or, more frequently, by special exception. Since there is a local demand for properties permitting salvage operations, those that have the zoning command a premium. I have seen two types-- the "junkyard" which is the stereotypical environmental nightmare and the responsibly managed salvage yard. Most of these properties I've seen have been very land-intensive with the improvements consisting of small low quality modular buildings, asphalt or crushed stone paving and security fencing. The sales comparison analysis would utilize sales of similar industrially zoned vacant parcels or those with minimal building improvements with the typical adjustments. I would not appraise the property unless I had the client's agreement that it would be appraised under the assumption that there was no environmental contamination or that if contamination was subsequently found, my value conclusion rendered would be null and void. I have been involved in the appraisal and sale of contaminated properties both with and without qualified environmental assessments and cost-to-clean estimates. If you chose to do the appraisal, protect yourself.

 

[DB]

It sounds to me like, basically, a land appraisal, with a cost to cure for removal of debris (the salvage) and about 3 inches of environmental disclaimers ... Should be no shortage of folks to help you if you get into a bind ... I wouldn't run from it .. I like the oddball appraisals ... sometimes you learn more from them than any other kind ...

 

[john snyder]

Doug,

Agree with you all the way. Many years ago during the brutal early 80's, I took all the AI courses in commercial, indust., litigation etc. Then let it be known in the local appraisal circles that I liked doing the oddball or difficult assignments.

While sometimes these are taxing time wise, I try to bid them fairly and usually like you, learn quite a bit about a particular type of business/industry.

Lately i am contacting estate attorneys regarding partial interest ownership in estates and the discounting procedures techniques. Seems to be catching on.

My mother owned a bar that was bordered on three sides by junk/auto savlage yards. Her favorite advertisement was that she "overlooked precious metals". :rofl:

The auto salvage industry has some serious cash for a dirty profession.

john

 

[john mello]

Ditto much in the already-posted replies. Environmental condition and remediation (cost to cure) are vital considerations. So, too, are alternative H&BU from which land sales/lease data can be found. Warehouse comps. are a good example. In the northeast, it appears that a new incarnation for (fully or partially...remediated) auto salvage yards is on-site personal storage facilities. Just another avenue to look down...