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Trials and Tribulations of a Road Widening Project

Paula Gutierrez Baeza, Esq. Richards, Watson & Gershon Amer Attar, P.E., MBA City of Temecula Joyce L. Riggs, MAI, SR/WA Riggs & Riggs, Inc. Trials and Tribulations of a Road Widening Project. PROJECT DESCRIPTION. Purpose of Project Road is a Major Arterial

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Trials and Tribulations of a Road Widening Project

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  1. Paula Gutierrez Baeza, Esq. Richards, Watson & Gershon Amer Attar, P.E., MBA City of Temecula Joyce L. Riggs, MAI, SR/WA Riggs & Riggs, Inc. Trials and Tribulations of a Road Widening Project

  2. PROJECT DESCRIPTION • Purpose of Project • Road is a Major Arterial • Realign and Widen Road to Ultimate Configuration • Connect Road to a Proposed Major Arterial Consistent with General Plan • Road Before Project • Center Dual Left Turn Lane • Dead-Ends at a Bank Building South of Project

  3. PROJECT DESCRIPTION • Road After Project • Two Lanes in Each Direction • Landscaped Median • Ability to Connect to Future Major Road • Full Street improvements

  4. PROPERTY DESCRIPTION • Industrial Building • Light Industrial Zoning • Business Park General Plan • Low Building Coverage Ratio • Access From One Driveway • Need for Small Area of Fee and Temporary Construction Easement for Project

  5. IMPACTS TO PROPERTY • Acquired Property and TCE • Landscaping & Internal Circulation Road Impacts • Widen Driveway • New Raised Median – Restrict Left Turns • Travel Distance for Truck from Freeway - Before vs. After Condition

  6. Driveway BeforeNo Raised Median Driveway After Raised Median

  7. Original Truck Route from Freeway3800 Ft ~ ¾ Mile New Truck Routes from Freeway 9500 Ft ~ 1 ¾ Miles 10800 Ft ~ 2 Miles

  8. NEGOTIATIONS WITH OWNER • Attempts to Acquire Property with Owner by Negotiated Agreement • No Success • Council Adopted Resolution of Necessity • Complaint Filed

  9. APPRAISAL VALUATION • Valuation of Larger Parcel – Entire Property • Income Capitalization • Sales Comparison Approach • Valuation of Land Value – As Acquisition Area Included Land and Only Site Improvements • Value of Fee Part Acquired (Land & Site Improvements) • Value of Remainder After Acquisition • Value of Temporary Construction Easement

  10. VALUATION OF THE PART ACQUIRED Land Area$/SF% Rights AcquiredIndicated Value 13,363 SF x $7.50 x 100% $100,223 Value of the Land - Fee Part Acquired $100,223 SITE IMPROVEMENST/COMPONENT SUNITUNIT PRICECOST • Asphalt Paving 5,850 SF $2.50 PSF $14,625 • Total Site Improvements $14,625 • Indirect Costs (13.0% of Direct Costs) $1,901 • Total Direct and Indirect Costs $16,526 • Entrepreneurial Profit (15.0% of Total) $2,479 • Replacement Cost New of Hardscape Improvements $19,005 • Less: Depreciation (50.0%) $ 9,503 • Depreciated Replacement Cost New of Hardscape $ 9,503 • Landscaping: • Grass with Sprinklers 7,513 SF $2.50 PSF $18,783 • Trees 2 $350.00 EA $ 700 • Total Landscaping Costs $19,483 • Indirect Costs (13.0% of Direct Costs) $2,533 • Total Direct and Indirect Costs $22,015 • Entrepreneurial Profit (15.0% of Total) $3,302 • Replacement Costs New of Landscaping $25,318 Estimated Value in Place of the Improvements $34,821

  11. Summary of Part Acquired Valuation Value of the Land to be Acquired in Fee $100,223 Plus: Value of the Improvements to be Acquired 34,821 Total Value of the Fee Part Acquired $135,044 * * * Area Rate Percentage Term Value 9,360 SF x $7.50/SF x 10% x 1.25 Year = $8,775 Value of Land Area in Temporary Construction Easement $8,775 All site improvements within the temporary construction easement area will be replaced in kind as part of the project.

  12. SUMMARY OF VALUE CONCLUSIONS Value of the Whole Before Acquisition $2,780,000 217,804 SF - site (fee) + improvements Value of the Part Acquired as Part of the Whole $135,044 (Fee) 13,363 SF of Land $100,223 Site Improvements $ 34,821 Value of the Remainder as Part of the Whole $2,644,956 Value of the Remainder After Acquisition, Disregarding Benefits $2,644,956 Severance Damages $ -0- Value of the Remainder After Acquisition, Considering Benefits $2,644,956 Less: Benefits $ -0- Net Severance Damages $ -0- Estimated Just Compensation $135,044 Value of Temporary Construction Easement Part Acquired: TCE 9,360 SF of land $ 8,775 Just Compensation for Temporary Construction Easement $ 8,775 Total Estimated Just Compensation $143,819 Rounded To: $145,000

  13. LEGAL PROCESS • Resolution of Necessity • Filing of Complaint in Eminent Domain • Answers Filed by Property Owner and Lessee • Meetings on Site with Property Owner and Lessee • Deposition of Lessee • Mediation to Narrow Issues • Exchange of Expert Valuation Data • Settlement with Lessee • Mediation on Valuation Issues • No Settlement with Owner • Deposition of Experts

  14. DEFENDANT’S APPRAISER’S VALUATION • Value of the Larger Parcel $3,600,000 • Value of Fee Part Acquired $ 286,240 • Land Value 13,363 SF @ $13.55/SF $181,100 • Improvements in Fee Area: • Three Mature Trees $50,000 • Grass & Sprinkler System $41,535 • Chain Link Fencing w/Barb Wire $ 1,875 • Asphalt Paving $11,730 • Total Improvements $105,140 • Temporary Construction Easement - 0- • Cost to Cure Damages (15% of $3,600,000) $ 540,000 • Severance Damages (20% of $3,600,000) $ 720,000 • Total Just Compensation $1,546,140

  15. DEPOSITION OF EXPERTS • Appraisal – Weakness in Property Owner’s Appraisal • Errors Found • Methodology Problems • Architect • Appraiser – 2nd Day Follow Up Questions • Traffic Engineer • Weakness in Analysis • Different Scale Used for Drawings • Truck Turning Radius Different than Scale Used for Underlying Architectural Site Drawings

  16. Truck Path Turning In Truck Path Turning Out

  17. FURTHER SETTLEMENT TALKS • After Depositions • Identified Strengths and Weaknesses of Case • Prepared Motions • Consideration of Trial Costs • Legal • Expert Fees • Exhibits • Stronger Negotiating Position After Depositions • Owner Settled for Less Than Original Offer

  18. WRAP UP • Owner’s Purpose in Challenging Acquisition – Rezone Property Light Industrial vs. Service Commercial

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