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Was the income attributable to the subject property as it <br /> physically existed at the time of listing, or has the <br /> property been improved since. If so, it may be necessary to <br /> adjust the income to reflect the proper rent. <br /> Does the reported income represent a full year's return? It <br /> is often advisable to obtain both monthly and annual amounts <br /> as a cross-check. <br /> Does the income reflect current market rent? Is either part <br /> or all of the income predicated on old leases? If so, what <br /> are the provisions for renewal options and rates. What is the true <br /> current market rent? <br /> Does the reported income reflect 100% Occupancy? What <br /> percentage of occupancy does it reflect? Is this percentage <br /> typical of this type of property, or is it due to special <br /> non-recurring causes? <br /> Does the income include rental for all marketable space? <br /> Does it include an allowance for space, if any, which is <br /> either owner- or manager-occupied? Is the allowance <br /> realistic? <br /> Is the income attributable directly to the real estate and <br /> conventional amenities? Is some of the income derived from <br /> furniture and appliances? If so, it will be necessary to <br /> adjust the income or make provisions for reserves to <br /> eventually replace them, whichever local custom dictates. <br /> In many properties an actual rental does not exist because <br /> the real estate is owner-occupied. In this event, it is <br /> necessary to obtain other information to provide a basis to <br /> estimate market rent. The information required pertains to <br /> the business operation using the property. Proper analysis <br /> of the annual operating statement of the business including <br /> gross sales or receipts can provide an accurate estimate of <br /> market rent. <br /> Analysis of Expense Data <br /> The appraiser must consider only those expenses which are <br /> applicable to the cost of ownership. Any portion of the <br /> expenses incurred either directly or indirectly by the <br /> tenant need not be considered. Reimbursed expenses can only <br /> be considered when the amount of reimbursement is included <br /> as income. Each expense item must stand the test of both <br />