2026_01_14 BOER Minutes - Laserfiche WebLink

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Docusign Envelope ID:43560945-04CF-4CB1-9034-34AEEA2DCF99 Evidence submitted by the appellant: • The appellant is requesting a lower valuation based on an income approach and actual income and expenses. Evidence submitted by the county representative: • The subject property,known as Shadowood Apartments consists of a 336-unit apartment complex located at 101 Shadowood Drive in Chapel Hill. The property sold in late 2023 for $42,500,00 or$126,488 per unit. The current assessed value is $40,759,500 or$121,308 per unit,whereas the appellant is requesting a value of$106,312. Since the purchase, the owner has spent over$800,000 on units and capital items ($356,000 in non-recurring expenses)and has increased rental revenue with the December rent roll showing a 2.5%higher rental revenue than the overall year. As investments are made the owners and future potential buyers would expect for expenses to go down. • The appellant has provided income and expense information in the form of a profit and loss sheet for the year 2024. However,they have included non-recurring expenses, which appear to include renovations and have not given any credit to the work that the owners have done since purchasing the property. Removing taxes and non-recurring expenses leaves an approximate total expense of$2,000,000 for the 2024 year,which is roughly 40%of Effective Gross Income. This figure is still quite high but is more understandable given the age and condition of the subject. There has been a general trend post-coding of maintenance and turnover backlogs, with management spending at a higher rate than is typical to update units. As a result,this figure could drop closer to 35%or even 30%once current ownership completes their renovations, as well as turning over any holdover units from the Covid years, along with increasing rents commensurately(which depresses the expense ratio). The County has used a conservative 40%expense ratio. Based on current information,the current assessment is low and should probably be in line with the recent sale and the Income Approach at$42,440,000. • Based on this analysis, applying the County's Schedule of Values,the county recommends decreasing the land market adjustment from -20%to -10%which would result in a revised value of$42,196,200. • GIS Map of Subject • Current Property Record Card(16 pages) • Proposed Property Record Card(16 pages) • Comparable Sales and Income Approach Motion of the Board Accept Count 's Proposed Value: $42,196,200 Made the motion Shannon Julian Seconded the motion Richal Vanhook Voted For All BOER Members Voted Against Property Identification: Property Owner Shelton Station Appellant(if different) Morgan Fowler/Ryan Apartments LLC LLC 11