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How would you.

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A. P. Grice

Sophomore Member
Joined
Apr 24, 2003
Professional Status
Certified General Appraiser
State
Virginia
...value this item. It's an interesting topic for discussion.

Appraising a large medical (orthopedic surgery) building. The main waiting room/atrium has recently had very large murals painted at either end. $18,000 'worth'....(which is really a very minor - virtually inconsequential - amount compared to the overall building cost.) I'm quite aware of the many 'tests' to differentiate personal property from fixtures or real estate, and indeed, this might have a soothing effect upon the patient waiting with a broke leg or whatnot...but when is the time (if ever) when "art" becomes "real estate"?

Cheers
 

Louis Pompeo

Member
Joined
Nov 23, 2007
Professional Status
Certified General Appraiser
State
Mariana Islands
It's not real estate.....it's some marks on the wall that are probably going to be triple painted over by the next user/tenent.

It's akin to wallpaper or paint. They may get away with claiming it as short-lived business property for depreciation purposes when they report to the IRS (and they probably do), but it's definately not real estate.
 

Kali the Boston Terrier

Senior Member
Joined
Jul 7, 2003
Professional Status
Certified General Appraiser
State
Michigan
People tear down Frank Lloyd Wright Buildings all the time, buildings with priceless murals painted on the side...one mans art is anothers place for a tourist map kiosk.
 

PropertyEconomics

Elite Member
Joined
Jun 19, 2007
Professional Status
Certified General Appraiser
State
New Mexico
I personally think they have no vaue but may assist in marketability of the property. If you really want to shock their conscience, do a cost to cure to repaint the walls. I did that once to a $15,000 piece of "art" on the side of a building ... the borrower was very upset and the lender thought it quite prudent. In the scheme of things it mattered not, the rounding was more than $15,000. The real qustion in my mind was what were all my comparables like, and none had the "art" on the side of the building. Case made for cost to cure.
Good luck.
 

Valuation75

Freshman Member
Joined
Feb 3, 2008
Professional Status
Appraiser Trainee
State
Virginia
If it is of value, it would be apparent in the income (my guess is that it does not increase income by much, if any). If the paintings are hung it is not real estate though, if it is painted on the walls, it is real estate and some art nut may want those walls very bad!!!!! However, the odds of an art nut purchasing this property would probably lower the cap rate by only .000000001 percent.
 

Michigan CG

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Joined
Nov 1, 2006
Professional Status
Certified General Appraiser
State
Michigan
Paint over the mural and ask how many people miss it in a month. No value.
 

Louis Pompeo

Member
Joined
Nov 23, 2007
Professional Status
Certified General Appraiser
State
Mariana Islands
Its Not Real Estate

If it is of value, it would be apparent in the income (my guess is that it does not increase income by much, if any). If the paintings are hung it is not real estate though, if it is painted on the walls, it is real estate and some art nut may want those walls very bad!!!!! However, the odds of an art nut purchasing this property would probably lower the cap rate by only .000000001 percent.

Its not real estate.m2:

finis...:angry:
 

The Warrior Monk

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Staff member
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Mar 30, 2005
Professional Status
Certified General Appraiser
State
New York
It possibly could add some value in certain situations, such as in a historic building. More often than not, though, in commercial properties, buyers/tenants don't care.
 
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