appraisal of real property report 202121 prepared for

APPRAISAL OF REAL PROPERTY

Valuation & Cost Studies on a

Multifamily Residential Site

Located at 1174-1185 Hillsboro Mile in

Hillsboro Beach, Broward County, Florida

Report 202121

PREPARED FOR

Mr. Mac Serda, ICMA-CM

Town Manager

The Town of Hillsboro Beach, Florida

1210 Hillsboro Mile

Hillsboro Beach, FL 33062

PREPARED BY

Atlantic Blue Consulting, Inc.

2000 North Bayshore Dr. #1103

Miami, Florida 33137

Phone: (305) 776-6131

ATLANTIC BLUE CONSULTING, INC. REAL ESTATE ADVISORY & VALUATION SERVICES

2000 NORTH BAYSHORE DR. #1103, MIAMI, FLORIDA 33137 PHONE (305) 776-6131

August 27, 2021

Mr. Mac Serda, ICMA-CM

Town Manager

The Town of Hillsboro Beach

1120 Hillsboro Mile

Hillsboro Beach, FL 33062

Re: Appraisal of Real Property

Valuation and Cost Studies on a Multifamily Residential Site

Located on 11.768 acres at

1174-1185 Hillsboro Mile in

Hillsboro Beach, Broward County, Florida

Dear Mr. Serda:

At your request, an appraisal of the Fee Simple interest in the above-referenced real property has been

completed, considering two potential development scenarios outlined in the table below:

High-Rise Scenario: Estimating the Prospective (Hypothetical) Market Value of the subject property, if

developed according to plans for the property by Arquitectonica (ARQ) dated July 29, 2021; they include a

proposed 15-story high-rise residential condominium development located to the east of Hillsboro Mile/State

Road A1A (SR A1A), with 112 total residential units, ground floor lobby and amenity spaces, and a

subterranean garage, plus nine proposed two-story residential units in detached “villas” each with a two car

garage, plus an “amenity” building with 9,294 square feet, located to the west of SR A1A and overlooking the

Intracoastal Waterway. This value would represent the Prospective (Hypothetical) Market Value if this

proposed development were completed as of the current valuation date.

Low-Rise Scenario: Estimating the Prospective Market Value of the subject property, if improved with a

multifamily residential development that is consistent with its highest and best use. This value would also

represent the Prospective Market Value of the property if this multifamily residential development were

complete as of the current valuation date. The highest and best use considers a development to the property

that is legally permissible (via zoning and other restrictions), physically possible based on an overview of the

site, and also represents a use that is financially feasible and maximizes the productivity (value) of the

property. Based on market conditions and the appraiser’s interpretation of the zoning code of the Town of

Hillsboro Beach, multifamily residential uses are allowed for development at the property, with a maximum

building coverage of 35% of the site area in three story buildings. Given the subject site’s size this allows for

a maximum gross building area of 538,263 square feet; with 10% to 15% of the gross building area used for

common elements, this leaves approximately 475,000 square feet of building area available for units’ living

space. The maximum density allows for up to 188 dwelling units to the property, providing for an average

unit size of 2,527 square feet under this Low-Rise Scenario.

The development costs for the project described in each of these two scenarios was also estimated as of the

current valuation date using the Marshall Valuation Service (Marshall), an authoritative guide for developing such

costs for buildings and other improvements. When the cost of the site is added to the total building and site costs

for development under each Scenario, the result can be compared to the estimated Prospective Market Value under

each of these Scenarios; the difference exhibits that potential entrepreneurial profit to a developer under each

Development Scenario.


2000 NORTH BAYSHORE DR. #1103, MIAMI, FLORIDA 33137 PHONE (305) 776-6131

The reader should carefully consider that these estimates of value and cost are subject to the

Assumptions and Limiting Conditions, Extraordinary Assumptions and Hypothetical Conditions set forth

in this report. The intended use of the appraisal is for internal decision-making by you, the Client, in negotiations

with potential developers seeking development approvals for this property. No other use of this report is intended

by the appraiser.

A physical inspection of the subject property was conducted from Hillsboro Mile (State Road A1A) by the

undersigned on the effective (current) date of valuation. The accompanying report includes pertinent data secured

in an investigation, exhibits and the details of the processes used to arrive at the conclusions of value and cost. The

analyses have been prepared in accordance with the Uniform Standards of Professional Appraisal Practice

(USPAP) and the requirements of the Client, Mr. Mac Serda, Town Manager for the Town of Hillsboro Beach,

Florida.

As a result of the examination and study made herein by the appraiser, the estimates of Prospective

(Hypothetical) Market Values of the fee simple interest in the appraised property, and estimated costs from

Marshall, if completed under each of the Development Scenarios, and subject to economic conditions prevailing as

of August 8, 2021 (the current valuation date), are presented below, along with the development (building and site)

costs and land cost, and the resulting entrepreneurial profit:

Respectfully submitted,

ATLANTIC BLUE CONSULTING, INC.

J Guthrie Mlinar, MAI, SRA

President

Cert. Gen. RZ1916

Development Scenario High-Rise Low-Rise

Prospective Market Value If Completed $390,880,000 $276,120,000

Less Development Costs

Land Cost $30,000,000 $30,000,000

Building & Site Improvement Cost $255,460,000 $157,660,000

Total Development Cost $285,460,000 $187,660,000

Entrepreneurial Profit $105,420,000 $88,460,000

Profit as a Percentage of Total Costs 37% 47%

MULTIFAMILY RESIDENTIAL SITE, 1174-1185 HILLSBORO MILE, HILLSBORO BEACH, FL

202121 REPORT


SUMMARY OF FACTS AND CONCLUSIONS

Property Type: Vacant multifamily residential development site

Location: Two parcels under the same ownership with a total of 11.768 acres

straddling either side of Hillsboro Mile/State Road A1A (SR A1A)

in the 1100 block of that roadway in the Town of Hillsboro Beach in

Broward County County, Florida.

Property Addresses: 1174-1185 Hillsboro Mile, Hillsboro Beach, Florida, 33062

Property Site Size (Gross)

Parcel A (Western Parcel): 234,316 square feet or 5.379acres

Parcel B (Eastern Parcel): 278,316 square feet or 6.389 acres

Total Subject Site Size: 512,632 square feet or 11.768 acres

Interest Appraised: Fee simple

Owner of Record: Hillsboro Mile Property Owner LLC


202121 REPORT


Summary of Facts and Conclusions (continued)

Purpose of the Appraisal: To estimate the property’s Prospective (Hypothetical) Market

Values If Completed under two proposed or potential Development

Scenarios, and to estimate the building, site and other costs to

construct each development as outlined in this report.

Client/Intended User: Mr. Mac Serda, Town Manager for the Town of Hillsboro Beach,

Florida (the Client)

Intended Use: For the Client’s for internal decision-making in negotiations with

potential developers seeking development approvals for this

property. No other use of this report is intended by the appraiser.

Real Estate Assessment & Taxes (2020):

Assessor’s Market Value: $35,300,000 (vacant land)

Assessed Value: $35,300,000

Total Taxes: $624,067.73

Date of Property Inspection: August 8, 2021

Effective (Current) Date of Valuation: August 8, 2021

Date of Report: August 27, 2021

Value & Cost Conclusions

Estimated Marketing Time: 12 months




Land Cost $30,000,000 $30,000,000






202121 REPORT


TABLE OF CONTENTS

CERTIFICATE ............................................................................................................................................... 1

ASSUMPTIONS AND LIMITING CONDITIONS ....................................................................................... 2

HYPOTHETICAL CONDITIONS ................................................................................................................. 3

EXTRAORDINARY ASSUMPTIONS........................................................................................................... 3

SECTION I INTRODUCTION ...................................................................................................................... 5

IDENTIFICATION OF THE PROPERTY ............................................................................................... 6 SCOPE OF WORK .................................................................................................................................. 6 DEFINITIONS OF VALUE AND INTEREST APPRAISED................................................................... 8 EXPOSURE TIME AND MARKETING PERIOD .................................................................................. 8 PROPERTY HISTORY ........................................................................................................................... 9 REGIONAL ANALYSIS ......................................................................................................................... 9 NEIGHBORHOOD ANALYSIS ............................................................................................................ 13

SECTION II DESCRIPTIVE DATA............................................................................................................ 16

CURRENT PROPERTY DESCRIPTION .............................................................................................. 17 ZONING ANALYSIS ............................................................................................................................ 20 PROPOSED PROPERTY DEVELOPMENT DESCRIPTIONS ............................................................. 20 PROPERTY TAXES AND ASSESSMENTS ......................................................................................... 26 HIGHEST AND BEST USE .................................................................................................................. 26

SECTION III VALUATION & COST ......................................................................................................... 30

VALUATION PROCESS ...................................................................................................................... 31 PROPERTY VALUATION ................................................................................................................... 31 COST ANALYSIS ................................................................................................................................. 53 POTENTIAL PROFIT ANALYSIS ....................................................................................................... 60

ADDENDA

Exhibit A Subject Property Photographs

Exhibit B Broward County Regional Analysis

Exhibit C High-Rise Scenario Architectural Plans

Exhibit D Engagement Letter

Exhibit E Appraiser’s Qualifications


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. CERTIFICATE

1

CERTIFICATE

The appraiser certifies that, to the best of his knowledge and belief,

the statements of fact contained in this report are true and correct.

the reported analyses, opinions, and conclusions are limited only by the reported assumptions and

limiting conditions, and are my personal, impartial, and unbiased professional analyses, opinions, and

conclusions.

I have no present or prospective interest in the property that is the subject of this report, and no

personal interest with respect to the parties involved.

I have not performed any other services, as an appraiser or in any other capacity, regarding the

property that is the subject of this report within the three-year period immediately preceding

acceptance of this assignment.

I have no bias with respect to the property that is the subject of this report or to the parties involved

with this assignment.

My engagement in this assignment was not contingent upon developing or reporting predetermined

results.

My compensation for completing this assignment is not contingent upon the development or reporting

of a predetermined value or direction in value that favors the cause of the client, the amount of the

value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly

related to the intended use of this appraisal.

the reported analyses, opinions, and conclusions were developed, and this report has been prepared, in

conformity with the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal

Foundation, and the requirements of the Code of Professional Ethics and the Standards of Professional

Practice of the Appraisal Institute and with the requirements of the State of Florida for state-certified

appraisers.

the use of this report is subject to the requirements of the Appraisal Institute relating to review by its

duly authorized representatives.

J Guthrie Mlinar has made a personal inspection of the property that is the subject of this report.

no one provided significant real property appraisal assistance to the persons signing this certification.

the undersigned has completed the requirements of the continuing education program of the Appraisal

Institute.

ATLANTIC BLUE CONSULTING, INC.

J Guthrie Mlinar, MAI, SRA

President

Cert. Gen. RZ1916


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. ASSUMPTION AND LIMITING CONDITIONS

2

ASSUMPTIONS AND LIMITING CONDITIONS

The appraisal is subject to the following assumptions and limiting conditions:

1. No survey of the subject property was undertaken.

2. The subject property is free and clear of all liens except as herein described. No responsibility is assumed

by the appraisers for matters, which are of a legal nature, nor is any opinion on the title rendered herewith.

Good and marketable title is assumed.

3. The information contained herein has been gathered from sources deemed to be reliable, including

architectural plans, a site survey, and building sizes and dimensions, etc. No responsibility can be taken by

the appraiser for their accuracy. Correctness of estimates, opinions, dimensions, sketches and other exhibits

which have been furnished and have been used in this report are not guaranteed. The value estimate

rendered herein is considered reliable and valid only as of the date of the appraisal, due to rapid changes in

the external factors that can significantly affect the property value.

4. This study is to be used in whole and not in part. No part of it shall be used in conjunction with any other

appraisal. Publication of this report or any portion thereof without the written consent of the appraiser is

not permitted.

5. The appraiser herein, by reason of this report, is not required to give testimony in court with reference to

the property appraised unless notice and proper arrangements have been previously made therefore.

6. The value estimate assumes responsible ownership and competent management. The appraiser assumes no

responsibility for any hidden or in apparent conditions of the property, subsoil, or structures, which would

render it more or less valuable. No responsibility is assumed for engineering, which might be required to

discover such factors.

7. Neither all nor any part of the contents of this report shall be conveyed to the public through advertising,

public relations, news, sales or other media without the written consent and approval of the author,

particularly as to valuation conclusions, the identity of the appraisers or firm with which they are

connected, or any reference to the Appraisal Institute.

8. Any exhibits in the report are intended to assist the reader in visualizing the property and its surroundings.

The drawings are not intended as surveys and no responsibility is assumed for their cartographic accuracy.

Any drawings are not intended to be exact in size, scale, or detail. Areas and dimensions of the property

may or may not have been physically measured. If furnished by the principal or from plot plans or surveys

furnished by the principal, or from public records, it is assumed that they are reasonably accurate. No

responsibility is assumed for discrepancies, which may become evident from a licensed survey of the

property.

9. The Americans with Disabilities Act (ADA) became effective January 26, 1992 sets strict and specific

standards for handicapped access to and within most commercial and industrial buildings. Determination of

compliance with these standards is beyond appraisal expertise and, thus this compliance has not been

attempted by the appraisers. We recommend an architectural inspection of the property to determine

compliance or requirements for compliance. It is possible that a compliance survey of the property together

with a detailed analysis of the requirements of the ADA could reveal that the property is not in compliance

with one or more of the requirements of the act. If so, this fact could have a negative effect upon the value

of the property.

10. Information on the property, including its size and physical condition, were based on county tax records, a

personal inspection, aerial photographs and materials supplied by the Client and are assumed to be correct.

The property is assumed to be free of any adverse environmental conditions, but a Phase I environmental

assessment of the property is recommended by a professional engineer for proper determination.


202121 REPORT


3

HYPOTHETICAL CONDITIONS

1. In the High-Rise Development Scenario outlined in this report, the property’s Prospective

Market Value and development costs are estimated for this project, if completed as of the

current valuation date. It includes a proposed 15-story high-rise residential condominium

development located to the east of Hillsboro Mile/State Road A1A (SR A1A), with 112 total

residential units, ground floor lobby and amenity spaces, and a subterranean garage. Zoning

of the subject property currently does not permit development of more than three stories, thus

it is a Hypothetical Condition that this high-rise development can be allowed at this location

under this Development Scenario.

2. The subject property is within “The Enclave at Hillsboro Beach” plat as recorded in Plat Book

154, Page 31 of the Broward County records. A restrictive plat note found on page 2 of this

plat states that “This plat is restricted to 6 detached single-family homes on Parcel A, and 6

detached single-family homes on Parcel B”. This effectively limits the subject property’s

development to 12 single-family homes. This deed restriction can be amended by approval of

the Broward County Board of County Commissioners. For the purposes of this valuation and

cost study, it is also a Hypothetical Condition that this deed restriction has been removed,

allowing for the proposed or potential development outlined in each of the two Development

Scenarios set for this report.

The reader should note that if either or both of these Hypothetical Conditions were to

change or not occur, the value and cost estimates presented herein under each Development

Scenario may significantly change.

EXTRAORDINARY ASSUMPTIONS

1. In the Low-Rise Development Scenario outlined for the subject property in this report, this

Development Scenario assumes that the subject property would be appraised at its highest

and best use. This highest and best use considers a development to the property that is legally

permissible (via zoning), physically possible based on an overview of the site, and also

represents a use that is financially feasible and maximizes the productivity (value) of the

property. Based on market conditions and the appraiser’s interpretation of the zoning code of

the Town of Hillsboro Beach, multifamily residential uses are allowed for development at the

property, with a maximum building coverage of 35% of the site area in buildings of up to

three stories in height. Given the subject site’s size, it is an Extraordinary Assumption that

this allows for a maximum gross building area of 538,263 square feet; with 10% to 15% of

the gross building area used for common elements, this leaves approximately 475,000 square

feet of building area available for units’ living space. The maximum density allows for up to

188 dwelling units to the property, providing for an average unit size of 2,527 square feet

under this Low-Rise Scenario.

2. In both Development Scenarios, a luxury multifamily residential condominium development

would occur. With average unit pricing that is estimated to be from over $1,700,000 to over

$3,700,000 (depending on which Scenario is considered), this would promulgate the highest

quality of interior and exterior finish the proposed development under either scenario. Thus,


202121 REPORT


4

it is an Extraordinary Assumption that the proposed multifamily residential development

under both Development Scenarios presented in this report would have ultra-luxury interior

and exterior furnishings commensurate with those at the newest nearby luxury condominium

developments in Broward and southern Palm Beach County cited as comparable properties in

the Valuation section of this report.

The removal of either of these Extraordinary Assumptions may have a significant effect on the

value and cost estimates provided in this report.


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. SECTION I INTRODUCTION 5

SECTION I INTRODUCTION


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. SECTION I INTRODUCTION

6

IDENTIFICATION OF THE PROPERTY

The subject of this report contains 11.768 acres of vacant land on two parcels that

straddle either side of Hillsboro Mile/State Road A1A in the 1100 block of that roadway in

Hillsboro Beach, Broward County, Florida. Parcel A is located between SR A1A and the

Intracoastal Waterway, and has 5.379 acres of land. Parcel B of the has 6.111 acres situated

between SR A1A and the Atlantic Ocean beach. These parcels are identified by the Broward

County Property Appraiser on 12 separate tax folios summarized below:

The street addresses of this property are 1174-1185 Hillsboro Mile, Hillsboro Beach,

Florida, 33062.

SCOPE OF WORK

The Uniform Standards of Professional Appraisal Practice (USPAP) define the scope of

the work as the type and extent of research and analysis in an assignment. The scope of this

analysis was to inspect the property, consider market characteristics and trends, collect and

analyze pertinent data, develop conclusions and estimates of the property's market value under

two Development Scenarios, and write a report that presents these findings to the Client.

The assignment includes consideration of the traditional approaches to value. However,

the Prospective Market Values of the subject property, if completed with the potential or

proposed Development Scenarios cited herein, require the estimate of the net present value of

the sellout of the individual residential condominium units that would be present. This is

effectively the Subdivision Development Method of estimating market value; and includes

methodology from both the Sales Comparison and Income Approaches to value.


202121 REPORT


7

In the Sales Development Method, a sales comparison analysis is undertaken to estimate

the “retail” value of each individual condo unit. It uses comparable sales in an analysis using

the methodology from the Sales Comparison Approach to estimate these values. These

comparable property sales are researched from the market and their prices are analyzed against

the subject units. A sellout or absorption period for disposition of the units is estimated from

recent trends at this location in the market. Closing costs from the sale of units are deducted

from the revenues from unit sales, along with holding costs including taxes, marketing costs,

etc. for the remaining unsold units during the sellout period. Risk is deducted from the net

proceeds after these costs are considered, providing for a net cash flow from unit sales.

As this sellout period is anticipated to occur over several periods, these net cash flows

must be discounted to present value. Discount rates (internal rates of return) were obtained from

analyzing their risk relative to that incorporated in the subject’s sellout. An appropriate discount

rate was selected for application to the sellout of the subject units to provide for a result net

present (market) values, if completed under each of the two Development Scenarios.

The primary source of development (building, site and indirect) costs for the project

outlined in each Scenario was the Marshall Valuation Service, an authoritative guide for

developing such costs for buildings and other improvements. Other ancillary costs were

obtained from market sources. When the cost of the land is added to each total, the result can be

compared to the estimated Prospective Market Value If Completed under each Development

Scenario; the difference exhibits that potential entrepreneurial profit to a developer under each


This report was produced in a manner that presents the pertinent data, which has been

collected and analyzed. It is the written result of the appraiser’s findings and analyses in

developing a conclusion about the property's market values and costs under each Development

Scenario and presents the appraiser’s reasoning in a manner intended to comply with the

Client’s requirements.


202121 REPORT


8

DEFINITIONS OF VALUE AND INTEREST APPRAISED

According to the Code of Federal Regulations, Title XI of the Financial Institutions

Reform, Recovery and Enforcement Act of 1989 (“FIRREA”), market value is defined as

follows:

Market Value

The most probable price, which a property should bring in competitive and open market under

all conditions requisite to a fair sale, the buyer and seller each acting prudently and

knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this

definition is the consummation of a sale as of a specified date and the passing of title from seller

to buyer under conditions whereby:

1. Buyer and seller are typically motivated.

2. Both parties are well informed or well advised, and acting in what they consider their own best

interests;

3. A reasonable time is allowed for exposure on the open market.

4. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements

comparable thereto; and

5. The price represents a normal consideration for the property sold unaffected by special or

creative financing or sales concessions granted by anyone associated with the sale.

Fee Simple Interest

Absolute ownership unencumbered by any other interest or estate, subject only to the limitations

imposed governmental powers of taxation, eminent domain, police power, and escheat.

Source: Appraisal Institute, The Dictionary of Real Estate Appraisal, 5th Edition, (Chicago, 2010)

EXPOSURE TIME AND MARKETING PERIOD

Exposure time is that time the property is assumed to have been on the market before the

assumption of a sale on the date of appraisal. Marketing time is that time, at any price, that the

property would take to sell from the date of appraisal forward, i.e., after the date of appraisal.

The relationship between price and marketing time is straightforward and normally, the lower

the price, the less time to market. With a reasonable listing price and aggressive marketing, it is

the appraiser’s opinion that the subject’s exposure and marketing times would both be no more

than twelve months.


202121 REPORT


9

PROPERTY HISTORY

On December 21, 2016, the subject property was acquired by Dezer Hillsboro, LLC

from Enclave at Hillsboro, LLC, for a price of $28.5 million. Media reports at the time of the

sale indicate that the buyer purchased the sale after gaining court approval for the sale as the

seller had previously experienced some financial difficulties. Four years later, or on

December 4, 2020, Dezer Hillsboro, LLC sold the subject to Hillsboro Mile Property Owner,

LLC, for a price of $30 million. The address of the buyer in the 2020 sale of the property

matches the corporate office address for The Related Group, a local developer. It is the

appraiser’s understanding that this was not a true “arm’s-length” sale of the property as

Related and Dezer are planning a development of the subject property.

No other sales or transfers of the subject property have occurred during the past five

years, and the subject has not be offered for sale or placed under contract during that period.

REGIONAL ANALYSIS

The subject property is located in the Town of Hillsboro Beach, which is located on the

barrier island between the Atlantic Ocean and the Intracoastal Waterway in northern Broward

County, Florida, north of the Hillsboro Inlet waterway. Broward County is the central and

second-most populous of a tri-county region (South Florida) whose population surpassed 6.2

million persons in 2019. A summary analysis of the economic and other trends affecting this

regional market is included in the Addenda of this report. Some of the data regarding the

Coronavirus Pandemic that began affecting the U.S. medically, economically and socially in

March 2020 is not yet available or fully complete.


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10

Impact of the Coronavirus Pandemic

The Coronavirus first appeared in China in early December 2019 and subsequently

spread worldwide into a pandemic by March 2020. The first U.S. case was recorded in

Washington state on January 21, 2020, and the virus has since spread to all 50 states. As of

April 8, 2020, more than 400,000 cases had been reported in the U.S., a number that had

increased to more than 2.3 million cases by late June 2020. While the mortality rate from

infection is relatively low in the U.S. (less than 2% to 3% of all cases), it has spread very

quickly and requires hospitalization for treatment of the Covid-19 disease it produces for 5% to

20% of all cases, threatening to overwhelm health care delivery systems across the country.

As a result, state and local governments closed schools and many businesses throughout

the country in an effort to control the spread of the Coronavirus. In Broward County, schools,

restaurants and bars were closed in mid-March 2020, although restaurants were allowed to

continue with take-out and delivery services. As of March 25, 2020, all non-essential


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11

businesses in the county were closed with residents urged to stay at home. The Federal

Government passed the first of two Pandemic relief acts providing $350 billion in federally-

guaranteed loans for small businesses.

Beyond the adverse public health aspects of this pandemic, the closure of businesses and

“stay-at-home” restrictions brought economic and other activities in Broward County and

throughout much of the U.S. to a virtual halt. While food and drug stores were allowed to

remain open, other “non-essential” businesses have closed and shed or furloughed employees

under these stay-at-home restrictions. In the first full week of April 2020 more than 15 million

Americans filed for unemployment; by June 2020 more than 45 million Americans had applied

for unemployment claims with an unemployment rate of more than 13%.

By May 2020, the stay-at-home orders and closing of non-essential businesses appeared

to be working to lower the increase in new cases particularly in heavily-hit locations particularly

in larger metropolitan areas. There were just over 1,500 new daily Coronavirus cases in Florida

in early April 2020. With shut-downs and “stay-at-home” orders, this number fell to less than

half that number of new daily cases by June 1st. This “flattening of the curve” of new cases

induced governments to plan for a re-opening of non-essential businesses in a phased approach;

this plan was made by some authorities despite not meeting CDC guidelines that are

recommended to be in place for a safe re-opening of these businesses. Various municipalities

and other governments began a first phase of re-opening in May 2020, allowing certain non-

essential businesses to reopen but under strict capacity and safety rules in place. Restaurants,

barber shops, salons and retailers were allowed to open under these circumstances.

The re-opening of restaurants and other businesses in Broward County and other parts of

Florida resulted in some complacency among government officials who may be re-opening their

economies in haste; this has also resulted in similar complacency among some members of the

general public and some businesses who have relaxed social distancing measures and the

wearing of protective masks and other advised precautions that are urged by health officials for

persons venturing out in public. Under these conditions, an unfortunate uptick in the number of

daily new Coronavirus cases began to occur. Additional testing capacity for the Coronavirus,

and the effects of some less responsible re-openings and personal behavior among some


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12

residents and governmental officials, led to a sharp uptick in the number of new daily reported

cases of this virus, reaching more than 13,000 statewide in mid-July 2020.

A second surge in new cases nationwide peaked at 67,000 in August 2020 before falling

to less than half that total in early September. The next month, however, a new surge in cases

began to appear across the U.S., bumping this figure up to almost 100,000 new cases daily with

every state reporting an increase. By December 2020, the new case totals continued to climb to

more than 180,000 per day. At that time, more than 16 million cases of Coronavirus had been

recorded nationwide, with the death toll from the Covid-19 disease it creates approaching

300,000. To date (July 2021), more than 600,000 American have died from Covid-19.

Despite these unfortunate numbers, many governmental officials continued to relax

restrictions that were put in place to combat the virus’s spread, including increased indoor

dining capacity, re-opening some entertainment venues. However, some officials and many in

the general public questioned whether or not this re-opening was done in haste. This caused

some potential patrons to become fearful of going out to stores, restaurants and businesses.

However, two vaccines by Pfizer and Moderna were produced in December 2020 to

combat the Coronavirus and Covid-19. The first immunization in the U.S. occurred on

December 14, 2020, with a roll-out of the vaccines introduced in stages. The first priority was

given to health care workers and others on the “front lines” combating the disease and first

responders. A third vaccine by Johnson & Johnson was introduced in March 2021. The

accelerating rate of vaccinations in Broward County allowed officials to announce that vaccines

for those 65 and older were available early that month, with additional age groups following.

By early April 2021, all Broward County residents 16 and older were eligible to receive the

vaccine, with testing providing for vaccines that were made available to those aged 12 to 15

rolled out in May 2021.

By August 2021 more than half of Floridians and 53% of Broward County residents had

been fully vaccinated (the Pfizer and Moderna vaccines require two doses), and more than half

of the county’s residents had received at least one dose. In mid-May 2021, the CDC relaxed its

guidelines stating that all Americans who have been fully vaccinated could resume their normal,

pre-Pandemic activities without wearing a facial mask or practicing social distancing; a “fully-


202121 REPORT


13

vaccinated” individual is anyone who received their final dose of the vaccine and allowed two

weeks to pass in order to maximize the vaccine’s efficacy.

Unfortunately, there is a sizeable proportion of the population that is resisting

vaccinations but have resumed normal activities. This has caused a new surge in Covid-19

cases since July 2021 at levels not seen for six months. Hospitals are once again filling up, this

time with those unvaccinated individuals who have contracted the disease with a larger

proportion of patients now falling between 20 and 45 years old.

In conclusion, employment and income growth continued in Broward County through

2019 after the recovery from the effects of the Great Recession from 2008-2010, with rising

visitation in this popular tourist destination. This fueled demand for different types of real estate

in this market including residential, commercial, industrial and hospitality. However, the

outbreak of the Coronavirus Pandemic in March 2020 caused a severe retreat in the previously-

occurring economic activity in the region. Businesses were forced to close through May of that

year, causing a sharp rise in unemployment. Most business activity has been allowed to resume,

providing for a reduction in unemployment but this is sometimes at limited levels and

vaccination resistance among some people and a sharp rise in new cases has resumed since July

2021, filling hospitals once again with some in the general public once again limiting their

activities in the near term. While the county’s underlying economic fundamentals and

infrastructure have a solid base, a full recovery is not expected until the underlying adverse

effects on the social, health and economic caused by the Pandemic can be resolved.

NEIGHBORHOOD ANALYSIS

According to the Appraisal of Real Estate, 13th Edition, a neighborhood is a group of

complimentary land uses. Social, economic, governmental and environmental forces influence

property values in the vicinity of the subject property, which, in turn, directly affect the value of

the subject property itself. The area of influence is the area within which the forces affect all

surrounding properties in the same way. The boundaries of the neighborhood are drawn by

observing the extent to which the four forces affect all properties in the same way.


202121 REPORT


14

The subject is located in the Town of Hillsboro Beach in northern Broward County.

Hillsboro Beach is solely located on the barrier island between the Atlantic Ocean and the

Intracoastal Waterway north of the Hillsboro Inlet waterway across from beachfront areas of

Pompano Beach to the south, and south of beachfront areas of Deerfield Beach to the north. It

has a population of approximately 2,000 with a single roadway, Hillsboro Mile/State Road A1A

(SR A1A) running along the spine of this narrow stretch of barrier island. State Road A1A runs

through beachfront communities in Broward, Miami-Dade and Palm Beach Counties, and it

connects to East Hillsboro Boulevard in Deerfield Beach to the north and East Atlantic Avenue

to the south in Pompano Beach. Both East Hillsboro Boulevard and East Atlantic Avenue cross

the Intracoastal Waterway for connections to U.S. Highway 1 and Interstate 95 to the west on

mainland areas of Broward County.

Most land uses in Hillsboro Beach are single- and multifamily residential, with a few

resort (small hotel and private club) and recreational uses also included. Through its zoning

restrictions, the Town of Hillsboro Beach has sought to limit building heights in order to avoid

the development of high-rise “condo canyons” of buildings found along the oceanfront in


202121 REPORT


15

Pompano Beach, Fort Lauderdale, and areas of Miami-Dade County to the south. The highest

multifamily residential development density allowed in Hillsboro Beach in 32 units per acre.

Development in Hillsboro Beach primarily occurred from the 1940s through the early 1970s,

but with some infill and redevelopment activity occurring since 2000. Single-family homes in

this market may carry price tags with eight figures, particularly for newer mansions that have

replaced some of the older single-family homes that were originally built in this market. The

estimated median household income in Hillsboro Beach in 2019 was $75,973, or more than

$16,000 greater than the statewide figure. However, the median resident age in Hillsboro Beach

was 67.4 years or 25 years greater than the statewide median, indicating a large number or

retired residents and/or senior citizens.

There are no supporting commercial/retail uses in Hillsboro Beach, but such uses can be

found along East Hillsboro Boulevard in Deerfield Beach to the north and areas along East

Atlantic Avenue in Pompano Beach to the south.

In conclusion, Hillsboro Beach is an affluent residential oceanfront community on the

barrier island of northern Broward County. Although it has been primarily built out since the

1970s, new infill and redevelopment activity continues to occur due to its attractive oceanfront

location. These are favorable long-term trends for development and investment activity in this

market.


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. SECTION II DESCRIPTIVE DATA

16

SECTION II DESCRIPTIVE DATA


202121 REPORT


17

CURRENT PROPERTY DESCRIPTION

The subject property includes vacant two parcels (A and B) of land straddling either

site of Hillsboro Mile/State Road A1A (SR A1A) in Hillsboro Beach. Parcel A is located to

the west of SR A1A and fronts to the Intracoastal Waterway to the west, while Parcel B is

located east of SR A1A and has frontage to the Atlantic Ocean beach to the east. Details of

each of these two parcels, and that for the composite subject property, are presented in the

tables below:

Parcel A

Parcel B

Gross Site Area - Sq.Ft. 234,316

Gross Site Area - Acres 5.379

Net/Upland Site Area - Sq.Ft. 222,214

Net/Upland Site Area - Acres 5.101

Primary Street Frontage State Road A1A/Hillsboro Mile

Water Frontage Intracoastal Waterway

Adjacent Land Uses - North Low-rise residential condominiums

Adjacent Land Uses - South Low-rise residential condominiums

Adjacent Land Uses - East State Road A1A/Hillsboro Mile

Adjacent Land Uses - West Intracoastal Waterway

Physical Characteristics - Western Intracoastal Frontage Parcel (A)

Source: Site inspection, survey





Primary Street Frontage State Road A1A/Hillsboro Mile

Water Frontage Atlantic Ocean



Adjacent Land Uses - East Atlantic Ocean beach

Adjacent Land Uses - West State Road A1A/Hillsboro Mile

Physical Characteristics - Eastern O ceanfront Parcel (B)

Source: Site inspection, survey


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18

Composite Subject Property

The survey used in obtaining site sizes and other information on the subject property

is from an ALTA land title survey by Schwebke Shiskin & Associates dated July 14, 2021,

and is assumed to be accurate. There were no significant easements or encroachments

exhibited on the parcels that would substantially limit development of the property. The

Coastal Construction Line runs north/south through Parcel B approximately 196 to 210 feet

east of the right-of-way for SR A1A. The Easterly Building Line from Map Book 2, Page 46

of the Broward County records, also runs north/south approximately 95 feet east of the

Coastal Construction Line (CCL). The CCL is not a building setback line but special

permission is required to development seaward of the CCL from the Florida Department of

Environmental Protection. In general, development seaward of the CCL may be granted if

other nearby buildings also encroach past the CCL (but not in all circumstances).





Zoning Classification RM-16

Zoning Authority Town of Hillsboro Beach



Adjacent Land Uses - East Atlantic Ocean

Adjacent Land Uses - West Intracoastal Waterway

Flood Panel Map: 12011C0187H

Panel Map Date: August 18, 2014

Flood Zone: AE & VE

Flood Area Description: Special flood hazard areas, elevation 5 to 12 feet

Utilities Provider

Water/Sewer Hillsboro Beach Water Dept.

Electricity Florida Power & Light

Natural Gas People's Gas

Telecommunications Private contractor

Trash Removal Private contractor

Topography At road grade

Vehicular Access At abutting roadway

Drainage Appeared adequate

Easements None noted; see comments below

Encroachments None noted; see comments below

Deed Restrictions None noted; see comments below

Source: Site inspection, FEMA, survey, Town of Hillsboro Beach, Broward County

Comparative Features

Physical Characteristics - Composite Subject Site


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19

A 1993 agreement with Broward County created a conservation area on Parcel B

nearest the Atlantic Ocean comprising 102,526 square feet of land (subject to increased

building height approval). This limits the developable area of Parcel B to 175,790 square

feet or 4.04 acres nearest to SR A1A. The boundary of this conservation area appears to

include the areas seaward of the Easterly Building Line along with existing dunes situated

near the CCL.

The subject property is within “The Enclave at Hillsboro Beach” plat as recorded in

Plat Book 154, Page 31 of the Broward County records. A restrictive plat note found on

page 2 of this plat states that “This plat is restricted to 6 detached single-family homes on

Parcel A, and 6 detached single-family homes on Parcel B”. This effectively limits the

subject property’s development to 12 single-family homes. This deed restriction can be

amended by approval of the Broward County Board of County Commissioners. For the

purposes of this valuation and cost study, it is also a Hypothetical Condition that this deed

restriction has been removed, allowing for the development outlined in each of the two

Development Scenarios set for this report.

The survey for Parcel A includes some areas of submerged lands below water

adjacent to the Intracoastal Waterway and west of an existing concrete dock/seawall on the

property. Most of the upland areas of Parcel A are generally level and at street grade, but

with some depressed areas at the northwest end of Parcel A sloping downward toward the

Intracoastal Waterway. This survey also indicates a submerged land lease area to the west of

the western boundary of Parcel A below the waters of the Intracoastal Waterway. It is

unknown whether this submerged land lease is currently active, and its area is not included

with the surveyed areas of Parcel A; as such, this submerged land area is not considered a

part of the subject property in this appraisal and cost study.

Parcel B has greater undulation to its topography, with a high berm of approximately

six feet or more above street grade and lining most of its frontage along SR A1A. There is an

opening in the berm near the southern end of the western boundary of Parcel B. East of this

berm, the topography of Parcel B falls again to near street grade before rising by as much as

approximately six feet again, particularly in the northern areas of Parcel B and forming dunes

with vegetation near where the site survey indicates the CCL is located. Beach and dune


202121 REPORT


20

erosion is a primary concern when considering buildings to be allowed seaward of the CCL,

thus the CCL is more likely forms a barrier to development to the east of that line at the

subject property.

No adverse environmental conditions were observed by the appraiser, but an

environmental assessment by a qualified engineer is recommended as the appraiser is not

qualified to make such assessments on the property.

ZONING ANALYSIS

As noted above, the subject property is zoned RM-16 by the Town of Hillsboro Beach

which allows for single- and multifamily residential uses up to a maximum density of 16

dwelling units per acre. General development restrictions under this zoning designation are

presented below:

PROPOSED PROPERTY DEVELOPMENT DESCRIPTIONS

The purpose of this appraisal is to estimate the property’s Prospective (Hypothetical)

Market Values under two potential Development Scenarios, and to estimate the building and

other costs to construct each development. The first is the High-Rise Scenario, in which the

Zoning Designation RM-16

Allowed Uses Single- and multifamily residential

Minimum Lot Width 100 feet

Minimum Lot Depth 100 feet

Minimum Lot Size (Sq.Ft.) 25,000

Maximum Building Height 35 feet

Maximum Building Ground Coverage 35%

Maximum Recreational/Green Coverage 15%

Maximum Residential Use Density 16 units/acre

Minimum Plot Area 2,900 sq.ft ./unit

Yard Setbacks:

Front Street 85 feet from center line of SR A1A

Between Buildings 15 feet

Rear 15 feet

Minimum On-Site Parking 1 space/unit

Minimum Multifamily Unit Size (Sq.Ft.)

1-Bedroom 1,000

2-Bedroom 1,300

3-Bedroom 1,600


202121 REPORT


21

property would be developed according to plans by Arquitectonica (ARQ) dated July 29, 2021;

they include a proposed 15-story high-rise residential condominium development located on

Parcel B to the east of Hillsboro Mile/State Road A1A (SR A1A) with 112 total residential

units, ground floor lobby and amenity spaces, and a subterranean garage, plus nine proposed

two-story residential units in detached “villas” each with a two car garage, plus an “amenity”

building with 9,294 square feet, located to the west of SR A1A on Parcel B and overlooking the

Intracoastal Waterway. The second valuation scenario considers a proposed multifamily

residential development consistent with the property’s highest and best use and as of the current

valuation date. This development is based on market conditions and the appraiser’s

interpretation of the zoning code of the Town of Hillsboro Beach; it would include 188

multifamily residential units in buildings of no more than three stories, consistent with the

development allowed under the property’s RM-16 zoning. Details of these two proposed

development Scenarios for the subject property are described below.

High-Rise Scenario

Under this scenario, the property would be developed according to architectural plans

from Arquitectonica (ARQ) dated July 29, 2021, which are presented in the Addenda of this

report. This development would include 112 one-level (flat) units in a 15-story tower on Parcel

B to the east of SR A1A, above a subterranean garage. Residential units would be located on

Floors 2 through 15, with a ground floor lobby and common areas.


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Residential units on each floor would include four 2-bedroom units ranging in size from

2,765 to 2,790 square feet, and four 4-bedroom units ranging in size from 4,710 to 5,520 square

feet in living area. All of the units on each floor would have east-facing views of the Atlantic

Ocean, while the 4-bedroom units would also feature west-facing views of the evening sunsets.

The total square footage of interior living space for these 112 residential units would be 442,400

square feet for an average unit size of 3,950 square feet.

The eight 15th

-floor “penthouse” units in the tower will also feature a rooftop pool and

pool deck. According to these plans by ARQ, the breakdown of gross building area for this

tower would be as follows:


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23

The ground floor will feature a front approach driveway with five open parking spaces,

an exterior deck with a swimming pool, a lap pool and a spa pool, terraces and a covered central

breezeway. The subterranean garage for this tower would have 187,036 square feet of gross

building area and contain 232 parking spaces.

Across SR A1A to the west, Parcel A is proposed for development with nine detached

two-story “villa” residential units which will feature views overlooking the Intracoastal

Waterway. Eight of the villa units will have 3,580 square feet of living space, with the

southern-most villa having 5,280 square feet. Each villa unit will also feature a two-car garage

with 420 square feet, and its own ground level pool as well as a rooftop deck with pool.

Tower Gross Sq.Ft.

Residential Floors 2-15 487,718

Lobby Etc. 29,977

Total 517,695

Garage 187,036


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24

The total living area of the nine villa units will be 33,920 square feet for an average unit

size of 3,769 square feet. At the north end of Parcel A will be a common amenity building with

a gross building area of 9,284 square feet, accompanied by 15 open parking spaces and a

rooftop pool. Parcel A will also have two tennis courts and a tennis pavilion, plus driveway

access to the various building improvements. A seawall will be constructed along the site’s

water frontage to the Intracoastal Waterway.

Details of the common amenity package for these improvements or the unit’s interior

finish is not provided; however, with its prime Hillsboro Beach location and ocean frontage, the

tower units are expected to exhibit ultra-luxury interior finish similar to that for the recently-

completed Sabbia Beach development in Pompano Beach, the proposed oceanfront Solemar

condominium project (also in Pompano Beach), and the other comparable sale properties cited

in the Valuation section of this report. This includes a full and high-end kitchen appliance

package, top-grade kitchen cabinetry and countertops, high-quality bathroom fixtures, vanities

and tile, and private balconies for each unit. Similar ultra-luxury finish is assumed for the nine

villa units along the Intracoastal Waterway, along with interior upper-floor access, ground floor

terraces, and balconies. As such, it is an Extraordinary Assumption that the proposed

multifamily residential development under this Development Scenarios would have ultra-luxury

interior and exterior furnishings commensurate with those at the newest nearby luxury

condominium developments in Broward and southern Palm Beach County cited in the

Valuation section of this report. However, most new condominium developments in this market

feature “developer finish”, meaning that only the flooring in the kitchens and baths are installed

by the developer; the unit buyer is responsible for selection and installation of flooring in other

parts of the unit.

Low-Rise Scenario

There are no development or architectural plans provided under this second

Development Scenario. It assumes that the property would be developed according to its

highest and best use, as described in the Highest and Best Use section of this report. According

to that analysis, 35% of the site’s 512,632 square feet can be covered by building improvements,


202121 REPORT


25

or 179,421 square feet of the site area. With up to three stories of building area, this allows for a

maximum gross building area of 538,263 square feet, as calculated below:

With 10% to 15% of the gross building area used for common elements, this leaves

approximately 475,000 square feet of building area available for units’ living space. The

balance of gross building area in this scenario would include common amenities for the

residents such as a clubroom, fitness center, etc., plus common interior unit access hallways and

elevator lobbies, fire staircases, maintenance closets, etc.

The maximum density allowed by zoning is 16 dwelling units per acre, providing for a

maximum of 188 dwelling units to the property. With 475,000 square feet of living space for

the dwelling units, this equates to an average unit size of 2,527 square feet under this Low-Rise

Scenario. Subterranean garages could be built for the units built on Parcels A and B up to two

units per acre plus some surface guest parking. The project’s exterior amenities would likely

include a pool and whirlpool for residents. Other site improvements would be commensurate

with those for the High-Rise Scenario including access driveways and the seawall for Parcel A,

but the larger number of units under this Low-Rise Scenario spread among low-rise buildings is

likely to eliminate the possibility of tennis courts or other exterior amenities in these

circumstances.

Under each Development Scenario, the prime location of the property remains the same,

thus similar ultra-luxury interior unit finish would also be included with the residential units and

common areas under this Low-Rise Scenario. This includes high-grade kitchen appliances,

cabinetry and countertops, best-quality bathroom fixtures, vanities and tile, and developer finish,

commensurate with the comparable sales cited for the subject in this scenario in the Valuation

section of this report.

Maximum Building Coverage 35% of Site

Maximum Building Height 3 Stories

Total Site Sq.Ft. 512,632

Maximum Building Coverage 35%

Maximum Ground Floor Building Area (Sq.Ft.) 179,421

Number of Allowable Floors 3

Maximum Building Sq.Ft. 538,263


202121 REPORT


26

PROPERTY TAXES AND ASSESSMENTS

The subject property is assessed under the jurisdiction of Broward County, Florida. The

assessment for the property is established each year as of January 1st by the County Property

Appraiser's Office at 100% of "Just Value". Just Value has been equated to Market Value less

closing costs. While the State of Florida requires real estate to be assessed at 100% of Just

Value, in reality, the ratio of the assessed value to sales price is generally below 100 %.

The tax due is computed according to annual millage rates established by the various

taxing authorities. Taxes are payable in November with a 4% discount and become delinquent

on the following April 1st. Millage rates are the amount paid per $1,000 of assessed value. As

of the current valuation date, the 2020 tax year is the most recent year for which finalized

assessed valuation and tax information would be available.

The total assessed values and taxes for the appraised property’s folios are summarized as

follows:

HIGHEST AND BEST USE

According to The Dictionary of Real Estate Appraisal, published by the Appraisal

Institute, the highest and best use may be defined as:

1 That reasonable and probable use that supports the highest present value of vacant land or improved

property, as defined, as of the date of appraisal.

2 The reasonably probable and legal use of land or sites as though vacant, found to be physically possible,

appropriately supported, financially feasible, and that results in the highest present land value.

Folio No. Land Assessor's Assessed 2020

48-43-08-13- Assessment Market Value Value Taxes

0010 $2,016,250 $2,016,250 $2,016,250 $35,702.35

0012 $2,077,980 $2,077,980 $2,077,980 $35,795.42

0013 $2,139,750 $2,139,750 $2,139,750 $37,889.20

0014 $2,201,480 $2,201,480 $2,201,480 $38,982.28

0015 $2,263,200 $2,263,200 $2,263,200 $40,075.14

0016 $2,324,980 $2,324,980 $2,324,980 $41,169.14

0020 $3,765,750 $3,765,750 $3,765,750 $66,681.28

0021 $3,726,530 $3,726,530 $3,726,530 $65,986.79

0022 $3,711,400 $3,711,400 $3,711,400 $65,718.87

0023 $3,698,390 $3,698,390 $3,698,390 $65,488.51

0024 $3,692,740 $3,692,740 $3,692,740 $65,388.44

0030 $3,681,550 $3,681,550 $3,681,550 $65,190.31

Totals $35,300,000 $35,300,000 $35,300,000 $624,067.73


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27

3 The most profitable use. Implied in these definitions is that the determination of highest and best use

takes into account the contribution of a specific use to the community and community development goals

as well as the benefits of that use to individual property owners. Hence, in certain situations the highest

and best use of land may be for parks, green belts, preservation, conservation, wildlife habitats, and the

like."

Highest and best use is analyzed under two separate applications or scenarios: (1)

highest and best use of the site as though vacant and (2) highest and best use of the property as

improved. The highest and best use of the site as though vacant is based on the theory that land

will be put to its maximally productive use and this use will determine the highest site value. It

is the basis for valuing the site. Highest and best use of the property as improved determines

what use or type of occupancy will create the highest value for the entire property, given any

existing improvements. It is the basis for comparable selection in both the sales comparison and

income capitalization approaches to value. As the property is currently unimproved, this

analysis only considers the property’s highest and best use as vacant.

The appraiser has evaluated the property’s highest and best use. Highest and best use

must meet four criteria. The use must be (1) legally permissible, (2) physically possible, (3)

financially feasible, and (4) maximally productive.

Legally Permissible

The subject property is zoned RM-16 which allows for single- or multifamily residential

development of up to 16 units per acre in buildings of no more than three stories. Given the

site’s size, this allows for a maximum development of 188 residential units at the property.

However, the property is within the “The Enclave at Hillsboro Beach” plat as recorded in Plat

Book 154, Page 31 of the Broward County records. A restrictive plat note found on page 2 of

this plat limits development of the appraised subject to 12 single-family homes. This restriction

can be amended by approval of the Broward County Board of County Commissioners. For the

purposes of this value and cost study, it is a Hypothetical Condition that this deed restriction has

been removed, allowing for development according to zoning (up to 16 units per acre or up to a

maximum of 188 residential units).


202121 REPORT


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Other zoning restrictions include a maximum building area coverage of 35% of the site.

With a total site size of 512,632 square feet, building improvements can cover a maximum of

179,421 square feet of the subject’s site area.

Physically Possible

The subject’s two parcels have a width and depth to provide for reasonable development

according to zoning. The Coastal Construction Line runs north/south through Parcel B

approximately 196 to 210 feet east of the right-of-way for SR A1A. The Easterly Building Line

from Map Book 2, Page 46 of the Broward County records also runs north/south approximately

95 feet east of the Coastal Construction Line (CCL). Although not a setback line, special

permission is required from the Florida Department of Environmental Protection to

development seaward of the CCL. In general, development seaward of the CCL may be granted

if other nearby buildings also encroach past the CCL (but not in all circumstances).

A 1993 agreement with Broward County created a conservation area on Parcel B nearest

the Atlantic Ocean comprising 102,526 square feet of land (subject to increased building height

approval). This limits the developable area of Parcel B to 175,790 square feet or 4.04 acres

nearest to SR A1A.

Otherwise, no easements or encroachments are apparent that would significantly limit

development, and all primary utility connections appear to be available. Parcel A is generally

level and at street grade, but a survey of this site indicates an area at the northwest end of this

parcel that slopes downward toward the shoreline of the Intracoastal Waterway. Parcel B

features dunes with vegetation running generally along the CCL, and a raised berm along its

frontage to SR A1A with a “valley” running in between. Conservation and concerns regarding

beach and dune erosion affecting development at the CCL, and the presence of a conservation

area nearest the Atlantic Ocean shoreline, may provide for some limitations of development of

Parcel B in areas of this parcel that are seaward of the CCL.

Financially Feasible & Maximally Productive

Up to 188 multifamily residential units are possible at the subject, in three-story

buildings. Among the possible uses are luxury rental apartments or for-sale condominiums.

Luxury rental projects have not been development in oceanfront locations in South Florida


202121 REPORT


29

(including Broward, Miami-Dade and Palm Beach Counties) since the 1990s. The amount of

rent that can be charged for the best-quality luxury rental projects in South Florida typically

provides for a value result of no more than $500,000 per unit for luxury multifamily rental

apartment development. In the Valuation section of this report, it is noted that the retail sale

price of the subject’s units under the Low-Rise Scenario is $1,731,936 per unit (upon

completion), with a net present value for these units of $1,468,723 per unit. This indicates that

the property’s value is maximized when the property is developed with luxury for-sale

condominiums.

From this analysis, the highest and best use of the subject property is for development of

188 multifamily residential units in three-story buildings, with the units to be sold to individual

condo unit buyers. This is synonymous to the Low-Rise Scenario of development for the

subject property outlined in this report. Although the number of units planned in the alternative

High-Rise Scenario of development conforms to the maximum density allowed under the

property’s zoning, it will feature a 15-story tower; this exceeds the maximum building height

currently allowed by zoning, thus development under the High-Rise Scenario would require a

zoning change or variance in order to proceed. Thus, it is a Hypothetical Condition that this

high-rise development can be allowed at the subject property under this High-Rise Scenario.


202121 REPORT

ATLANTIC BLUE CONSULTING, INC. SECTION III VALUATION 30

SECTION III VALUATION & COST


202121 REPORT


VALUATION PROCESS

There are three recognized approaches considered in the valuation of real property; the

Cost Approach, the Income Approach, and the Sales Comparison Approach. The type and age

of any improvements to a property, and the quantity of available data affect the applicability of

each approach in a specific appraisal situation. However, the Prospective Market Values of the

subject property, if completed under either Development Scenario cited herein, require the

estimate of the net present value of the sellout of the individual residential condominium units

that would be present. This is effectively the Subdivision Development Method of estimating

market value; and includes methodology from both the Sales Comparison and Income

Approaches to value.

In this methodology, a sales comparison analysis is undertaken to estimate the “retail”

value of each individual condo unit using comparable sales. A sellout or absorption period for

disposition of the units is estimated from recent trends at this location in the market. Closing

and holding costs from the sale of units are deducted from the revenues from unit sales, and risk

is deducted from the net proceeds after these costs are considered, providing for a net cash flow

from unit sales. These net cash flows are then discounted to present value.

PROPERTY VALUATION

The Sales Comparison methodology includes an analysis of what buyers in the area are

paying for similar units. The retail price of each residential unit is derived from sales of

comparable properties in a similar time period as the current valuation date. It is necessary to

evaluate factors such as market conditions (including date of sale), location, site condition,

zoning, visibility, accessibility and other factors when making the comparison.

Under both the High-Rise and Low-Rise Scenarios, the subject units would be marketed

as luxury residential condominiums in an exclusive location fronting to the Atlantic Ocean

beach and the Intracoastal Waterway in Hillsboro Beach. As such, there is some overlap in the

comparable sales that would be used in estimating the retail price that would be paid for units in

the tower building in the High-Rise Scenario and for the condo units in the Low-Rise Scenario.

For this reason, a presentation and analysis of the comparable sales is provided from which the

most-comparable sales can be derived in determining value.


202121 REPORT


Comparable Sales – Luxury “Flat” Condominiums

These include units with a single level within a luxury condominium project, with sales

typically occurring since the beginning of 2020. Units were selected from buildings that are no

more than five years old from locations with ocean and/or Intracoastal Waterway frontage in

northern Broward County (to the north of Sunrise Boulevard in Fort Lauderdale) and southern

Palm Beach County (south of the Town of Palm Beach). A description of each is presented

below.

Sabbia Beach Condominium

730 North Ocean Boulevard

Pompano Beach, FL

No. Units: 69

Year Built: 2019

No. of Stories: 19

Parking: Garage (2 spaces/unit)

Unit Features: Full kitchen appliance package,

washer & dryer, smart home, balconies

Project Amenities: Pool, Spa/Hot Tub,

Clubroom, Fitness Center, Business Center,

Doorman Security

This luxury condominium has an oceanfront location in Pompano Beach. It features 2-, 3- and 4-

bedroom standard residences ranging in size from 1,760 to 3,589 square feet.


202121 REPORT


Solemar Condominium


Pompano Beach, FL

No. Units: 105

Year Built: Proposed/New

No. of Stories: 20

Parking: Garage (2 spaces/unit)



Project Amenities: 2 Pools, Spa/Hot Tub,

Clubroom, Fitness Center with Spa Treatment

Rooms, Wine Salon, Outdoor Pavilion with Bar,

Doorman Security

This luxury condominium is proposed for an oceanfront location in Pompano Beach, with unit pre-sales

occurring. It features 2- and 3-bedroom standard residences ranging in size from 2,004 to 2,589 square

feet, and is being developed by the Related Group.

1200 The Ocean Condominium

1200 Hillsboro Mile

Hillsboro Beach, FL

No. Units: 29

Year Built: 2016

No. of Stories: 3

Parking: Garage (1 space/unit)



Project Amenities: 2 Pools, Clubroom, Fitness

Center; 18 units on the oceanfront east of SR

A1A and 11 units on the Intracoastal west of SR

A1A

This luxury condominium is the newest development in Hillsboro Beach and features and oceanfront

building with 18 units and an 11-unit building across SR A1A along the Intracoastal Waterway to the

west. It features 3-bedroom residences ranging in size from 1,825 to 2,374 square feet. Only six units

in the oceanfront building have direct east-facing views of the Atlantic Ocean, with the other 12 units in

that building have oblique side views of the ocean (facing north and south) from their balconies.


202121 REPORT


3550 South Ocean Condominiums

3550 South Ocean Boulevard

South Palm Beach, FL

No. Units: 30

Year Built: 2019

No. of Stories: 8




Project Amenities: Pool, Fitness Center,

Doorman Security

This luxury condominium has an oceanfront location in Palm Beach County. Only the “A” and “B”

lines in the building offer east-facing ocean views from the building, with the other units having an

oblique or partially-blocked ocean view. The standard 3-bedroom units at this property range in size

from 2,606 to 3,390 square feet.

Auberge Beach Condominiums


Fort Lauderdale, FL

No. Units: 171

Year Built: 2018

No. of Stories: 17-24




Project Amenities: Multiple Pools, Whirlpool,

3 Clubrooms, Fitness Center, Spa, Restaurant &

Bar, Wine Room, Cigar Lounge, Golf

Simulator, Store, Private Pool Lounges,

Doorman Security

This luxury condominium has an oceanfront location and an impressive array of common amenities for

residents that include a restaurant and bar, several clubrooms, a spa, wine room, store, etc. It features a

variety of unit floor plans ranging in size from 1,350 to 4,636 square feet.


202121 REPORT


3200 South Ocean Boulevard

Highland Beach, FL

No. Units: 19

Year Built: 2016

No. of Stories: 7




Project Amenities: Rooftop Pool, Clubroom,

Fitness Center, Beach Club, Doorman Security

This luxury boutique condominium is situated along the Intracoastal Waterway in southern Palm Beach

County. It has 3 bedroom units ranging in size from 2,754 to 3,662 square feet, many of which also

have some views of the ocean across SR A1A to the east.

33 Intracoastal Condominiums

2895 N.E. 33 Court

Fort Lauderdale, FL

No. Units: 11

Year Built: 2018

No. of Stories: 5




Project Amenities: Pool, Clubroom, Boat Dock

This luxury boutique condominium is located on the mainland areas of northeastern Fort Lauderdale on

a point lot with two frontages (east and north) along the Intracoastal Waterway. It has 3 bedroom units

ranging in size from 1,878 to 2,126 square feet, each as a corner unit, plus two 5th floor penthouse units.


202121 REPORT


High-Rise Scenario - Valuation of Tower Units

In this Scenario, the average unit size of the 112 tower units will be 3,950 square feet,

located within a 15-story building on beachfront Parcel B of the subject property. From the

comparable properties, recent sales of units at these projects are noted in the table below:


202121 REPORT


The sales from Sabbia Beach and Solemar are most comparable to the subject. Units at

Sabbia Beach recently sold for prices ranging from $771 to $931 per square foot of living space,

with a lower-floor (4th floor) unit having a lower sale price of $611 per square foot. At the

proposed Solemar project, pre-sale prices have recently ranged from $815 per square foot for a

lower (4th floor) unit, with a current asking price per square foot of $975 for a unit near the top

floor of this project. Both of these properties are located in Pompano Beach, which does not

have the exclusive address of Hillsboro Beach. As such, the prices paid for units at these two

projects likely set the base of the range of average sale prices that the tower units in the High-

Rise Scenario could likely command in this market.

P ro pe rty & S ize Unit S a le

M o de l/ Unit Type (S F ) Type S a le P ric e P ric e / S F D a te

S ubje c t P ric ing

Hills bo ro Hig h-R is e 3 ,9 5 0 Va rie s C urre nt

C OM P A R A B LE R EC EN T S A LE P R IC ES

Sabbia Beach # 1505 1,955 3/3 $ 1,590,000 $ 813 7/10/2021

Sabbia Beach # 1203 1,880 2/3 $ 1,450,000 $ 771 5/14/2021

Sabbia Beach # 1102 2,525 3/4 $ 2,050,000 $ 812 5/2/2021

Sabbia Beach # 1503 1,880 2/3 $ 1,749,800 $ 931 4/20/2021

Sabbia Beach # 401 1,760 2/3 $ 1,075,000 $ 611 4/19/2021

Sabbia Beach # 1202 2,525 3/4 $ 2,300,000 $ 911 4/1/2021

Sabbia Beach # 1804 3,751 4/5.5 $ 3,100,000 $ 826 2/18/2021

So lemar P o mpano # 406 2,589 3/3.5 $ 2,109,900 $ 815 P ending

So lemar P o mpano # 1803 2,004 2/2.5 $ 1,952,900 $ 975 As king

1200 The Ocean Hills bo ro # 1204 1,825 3/3 $ 975,000 $ 534 6/2/2021

1200 The Ocean Hills bo ro # 1303 1,881 3/3 $ 930,000 $ 494 2/16/2021

1200 The Ocean Hills bo ro # 1302 2,105 3/3 $ 1,070,000 $ 508 2/8/2021

3550 So uth Ocean So . P a lm # 4B 2,982 3/4 $ 3,120,000 $ 1,046 6/29/2021

3550 So uth Ocean So . P a lm # 2C 2,743 3/3 $ 1,499,503 $ 547 5/24/2021

3550 So uth Ocean So . P a lm # 3C 2,743 3/3 $ 1,666,800 $ 608 5/24/2021

3550 So uth Ocean So . P a lm # 3A 3,390 3/4 $ 4,200,000 $ 1,239 3/9/2021

3550 So uth Ocean So . P a lm # 2A 3,390 3/4 $ 4,000,000 $ 1,180 2/15/21

Auberge Beach # S1801 3,301 4/5 $ 4,700,000 $ 1,424 12/1/2020

Auberge Beach # N804 2,508 3/4 $ 3,275,000 $ 1,306 9/14/2020

3200 So uth Ocean # 601 2,754 3/4 $ 2,500,000 $ 908 4/1/2021

3200 So uth Ocean # 603 2,754 3/4 $ 2,900,000 $ 1,053 3/31/2021

33 Intraco as ta l Co ndo s # 3C 2,068 3/3 $ 935,000 $ 452 3/3/2019

33 Intraco as ta l Co ndo s # 3B 2,000 3/4 $ 1,070,000 $ 535 11/5/2018

33 Intraco as ta l Co ndo s # 2A 2,126 3/4 $ 1,350,000 $ 635 11/4/2018

33 Intraco as ta l Co ndo s # 2B 1,878 3/4 $ 1,525,000 $ 812 11/4/2018


202121 REPORT


While 1200 The Ocean represents sales of the newest condominiums in an oceanfront

project in Hillsboro Beach, the recent sales of units at this property feature oblique side views of

the ocean rather than direct views from the units, and locations on lower floor levels. As such,

the prices per square foot that were paid for these units were lower, ranging from $494 to $534

per square foot of living area.

Auberge Beach is a similar larger-scale luxury condominium in this market, but offers a

much-wider array of common amenities than that proposed for the High-Rise Scenario at the

subject. This includes three clubrooms, a spa, an on-site restaurant and bar, and other elements.

This property is also nearer to major retail, entertainment and transportation hubs in Broward

County than the subject or the other comparable projects cited in the preceding table. Thus,

prices that were recently paid for units at Auberge Beach were higher, ranging from $1,306 to

$1,424 per square foot of living space. This likely sets the maximum range of sale prices per

square foot that the subject’s tower units could generate in the High-Rise Scenario.

The other comparable properties feature smaller boutique buildings or those that front

the Intracoastal Waterway rather than the Atlantic Ocean beach. As such, less reliance was

placed on their indicated sale prices in estimating the retail sale price of units in the proposed

tower in the High-Rise Scenario for the subject property. Based on this analysis, the average

sale price per square foot for units in that proposed tower structure in this Scenario is estimated

to be $950 per square foot. This represents an average, thus units on lower floors would likely

command a lower price per square foot, with a higher price per square foot likely for units on

upper floors. The 15th floor units at the subject would each feature an added rooftop deck with

its own private swimming pool. For this location in the tower building in this Development

Scenario, and for this added living space and amenity, these eight units would have a higher

average price per square foot of $1,100.

Low-Rise Scenario - Valuation of Standard Units

In this Scenario, 188 units would be built in three-story buildings with an average unit

size of 2,527 square feet. However, as previously noted Parcel B has the CCL running

north/south through it with significant vegetation on this oceanfront site. It is likely that this will

limit the beach/ocean views of any units on lower floors of buildings constructed on this parcel.


202121 REPORT


Furthermore, there is a conservation area on seaward areas of this parcel limiting its

development area to 4.04 acres nearest SR A1A; Parcel A has a size of 5.379 acres, calculating

to a total developable area of 9.419 acres. Thus, the developable area of Parcel B is 42% of the

total developable area of the subject. With three-story structural height limits promulgated

throughout the property, approximately 80 units in this Development Scenario could be built on

Parcel B, with the balance of 108 units developed on Parcel A. It is estimated that

approximately half of those 108 units on Parcel A could have a direct view of the Intracoastal

Waterway, with the balance of 54 units having an obstructed or oblique view (at best) of this

waterway.

As low-rise units, the sale of Unit 401 on the lower (4th) floor at Sabbia Beach and Unit

406 at Solemar, the lower price indications from $611 to $815 per square foot provide an

indication of values for the 80 units on beachfront Parcel B of the subject. This supports an

average price per square foot of $750 for these 80 units, and considers that some of those units

on Parcel B may have views of the ocean and beach that are obstructed by dunes and vegetation

along the CCL on Parcel B.

For the remaining 108 units on Parcel A in this Development Scenario, the sales from

3200 South Ocean and 33 Intracoastal provide a good indication as these units sold in projects

that front to the Intracoastal Waterway. The higher prices for units on the 6th floor of 3200

South Ocean, ranging from $908 to $1,053 per square foot of living space, reflect their superior

views on higher floors that allow for Intracoastal views and some ocean views across SR A1A to

the east. At 1200 The Ocean, units with obstructed ocean views in this low-rise project sold for

prices ranging from $494 to $534 per square foot; however, these unit sales occurred in an

oceanfront building. Unit sales at 33 Intracoastal recently ranged from $452 to $812 per square

foot of living space, but with a predominant range from $452 to $635 per square foot. This

project fronts the Intracoastal Waterway in Fort Lauderdale, but is located on the mainland

(west) side of the Intracoastal. While this location is closer to shopping and entertainment areas

of east central Broward County, it lacks the walking distance to the Atlantic Ocean beach of the

units in this Low-Rise Scenario that would be placed on Parcel A of the appraised property.

Based on this analysis, the estimated 54 units that would likely have direct Intracoastal

Waterway views from Parcel A in this Development Scenario would have an average retail price


202121 REPORT


of $700 per square foot. For the remaining 54 units on Parcel A in this Low-Rise Scenario that

would likely have (at best) an obstructed or oblique view of the Intracoastal Waterway, an

average sale price of $575 per square foot is estimated.

Comparable Sales – Luxury “Villa” Condominiums

These include units in the High-Rise Scenario that are located on Parcel A fronting the

Intracoastal Waterway. These will be detached single-family dwelling units with two levels and

a rooftop deck and pool, and featuring direct Intracoastal Waterway views. In order to estimate

the retail price for these units, recent sales of newer detached homes along the Intracoastal

Waterway were obtained, along with recent sales of newer townhomes with this locational

feature; recent sales of similar detached ground floor units that are part of a larger luxury

multifamily residential development in this market were not available. A description of each is

presented below.

2800 N.E. 29 Street

Lighthouse Point, FL

Property Type: Semi-detached townhome

Year Built: 2021

Bedrooms/Baths: 4/5

Living Area: 4,097 Sq.Ft.

Parking: 2-Car Garage

Property Features: Full kitchen appliance

package, washer & dryer, smart home, balcony,

patio, pool, pool deck with outdoor kitchen,

whirlpool, boat dock


202121 REPORT


2305 North Riverside Drive

Pompano Beach, FL

Property Type: Detached single-family home

Year Built: 2020

Bedrooms/Baths: 6/8




package, washer & dryer, smart home, elevator,

balcony, patio, pool, pool deck, whirlpool, boat

dock, end-cap lot

1713 North Riverside Drive

Pompano Beach, FL


Year Built: 2020

Bedrooms/Baths: 4/5





patio, pool, pool deck, whirlpool, boat dock

149 S.E. 18 Avenue

Deerfield Beach, FL


Year Built: 2021

Bedrooms/Baths: 5/5.5





patio, pool, pool deck, whirlpool, boat dock


202121 REPORT


136 & 138 MacFarlane Drive

Delray Beach, FL

Property Type: Semi- & attached townhomes

Year Built: 2016

Bedrooms/Baths: 3/5 and 4/5

Living Area: 4,486 to 4,568 Sq.Ft.




patio, pool, pool deck, rooftop deck

High-Rise Scenario - Valuation of Detached Villa Units

In this Scenario, Parcel A of the subject property will be developed with nine detached

single-family villa units ranging in size from 3,580 to 5,280 square feet of living space. The

average unit size of the nine villa units will be 3,769 square feet of living space. From the

comparable properties, recent sales of units at these projects are noted in the table below:


202121 REPORT


The sales from Pompano Beach and Deerfield Beach represent detached single-family

dwelling units similar to the configuration of the subject’s proposed villa units in this

Development Scenario. Each has a location along the Intracoastal Waterway with sale prices

ranging from $713 to $1,077 per square foot. None of these properties would be subject to a

common condominium owners’ association; by contrast, none would have the common

amenities that would be available to the subject’s villa unit owners under the High-Rise Scenario

set forth in this report.

The sale from Lighthouse Point and the sale from 138 MacFarlane Drive in Delray

Beach are semi-detached townhomes, meaning that they are attached to another dwelling unit on

just one side. These two properties sold for similar prices per square foot or from $830 to $964

per square foot. From this analysis, the average sale price for the villa units in the High-Rise

Scenario is estimated to be $900 per square foot of living area.

Estimate of Aggregate of Retail Values (ARV) for Each Development Scenario

High-Rise Scenario

In this Scenario, there will be 112 units in the tower building on Parcel B, and nine villa

units on Parcel A. The units in the tower building were estimated to have an average price per

square foot of $950, except for the eight premium penthouse units which will feature a rooftop

deck and pool; those eight penthouse units will have a higher average price per square foot of

$1,100. Among the nine villa units, an average price of $900 per square foot has been

P ro pe rty & S ize Unit S a le

M o de l/ Unit Type (S F ) Type S a le P ric e P ric e / S f D a te

S ubje c t P ric ing

Hills bo ro Villa s 3 ,7 6 9 3 / 2 C urre nt

C OM P A R A B LE R EC EN T S A LE P R IC ES

2800 NE 29 St. Lightho us e P t. 4,097 4/5 - TH $ 3,950,000 $ 964 5/26/2021

2305 N Rivers ide Dr. P o mpano 5,989 6/8 - SFR $ 6,450,000 $ 1,077 6/1/2021

1713 N. Rivers ide Dr. P o mpano 3,454 4/5 - SFR $ 2,462,500 $ 713 5/4/2021

149 SE 18 Ave. Deerfie ld Beach 4,765 5/5.5 SFR $ 4,515,000 $ 948 4/2/2021

136 MacFarlane Dr. Delray Beach 4,486 3/5 - TH $ 3,550,000 $ 791 4/5/2021

138 MacFarlane Dr. Delray Beach 4,568 4/5 - TH $ 3,790,000 $ 830 11/13/2020


202121 REPORT


estimated. Using these figures, a total retail sellout of the subject under the High-Rise Scenario

is estimated to be $455,548,000 (rounded), as calculated below:

This figure represents the Aggregate of Retail Value (ARV) for the units at the subject

under this Development Scenario, which equates to an average retail price per unit of

$3,764,860. These ARV indications are not synonymous with Market Value. The previous

sales comparison analysis was undertaken to estimate the “retail” value of each individual unit in

this Development Scenario using an analysis of comparable sales. A sellout period for

disposition of the lots must also be estimated, with holding costs from the sale of lots deducted

from the revenues from lot sales including taxes, marketing costs, etc. for the remaining unsold

lots during the sellout period. A risk factor is deducted from the net proceeds after these costs

are considered, providing for a net cash flow and a net present value (Market Value) from unit

sales in this High-Rise Scenario.

Low-Rise Scenario

In the Low-Rise Scenario, the 80 units on beachfront Parcel B were estimated to have an

average price of $750 per square foot of living area. The 54 units that would likely have direct

Intracoastal Waterway views from Parcel A in this Development Scenario would have an

average retail price of $700 per square foot. For the remaining 54 units on Parcel A in this Low-

Rise Scenario that would likely have (at best) an obstructed or oblique view of the Intracoastal

Waterway, an average sale price of $575 per square foot is estimated. From these figures, the

ARV for the subject property, considering the Low-Rise Scenario, would be as follows:

Unit No. of SF Per Total Retail Total Retail

Type Units Unit Sq.Ft. Price/SF Sellout

Standard Tower 104 3,950 410,800 $950 $390,260,000

Penthouse 8 3,950 31,600 $1,100 $34,760,000

Villas 9 3,769 33,920 $900 $30,528,000

Totals 121 476,320 $455,548,000

Averages 3,937 $3,764,860


202121 REPORT


This provides an ARV estimate of $325,603,950 in this Low-Rise Scenario, for an

average price per unit of $1,731,936.

In both Development Scenarios, a luxury multifamily residential condominium

development would occur. With average unit pricing that would be from over $1,700,000 to

over $3,700,000, this would promulgate the highest quality of interior and exterior finish the

proposed development under either scenario. Thus, it is an Extraordinary Assumption that the

proposed multifamily residential development under both Development Scenarios presented in

this report would have ultra-luxury interior and exterior furnishings commensurate with those at

the newest nearby luxury condominium developments in Broward and southern Palm Beach

County, or similar to those cited above in this section of the report.

Sales (Absorption) Rates for Luxury Multifamily Condominium Projects

The Broward County housing market is demonstrating a period of expansion with a rate

of development that appears to be meeting future demand by new home buyers. Although

demand is not as deep as Miami-Dade County, the luxury oceanfront condominium market in

Broward County has experienced healthy absorption of new units developed in this market.

Typically, units at new projects are pre-sold to buyers when the development is proposed or

under construction. At these new projects, the developer will often have a temporary sales office

that is staffed full time with brokers whose attention is solely placed on their particular

development.

Many lenders require a developer to pre-sell 50% of the proposed units before they will

provide funding for construction. Pre-sales of units continues after construction begins until the

project is completed. Upon completion of construction and the issuing of a Certificate of

Occupancy, the closing and transfer of ownership for pre-sold units may begin.

Unit No. of SF Per Total Retail Total Retail

Type Units Unit Sq.Ft. Price/SF Sellout

Beachfront 80 2,527 202,160 $750 $151,620,000

Intracoastal 54 2,527 136,458 $700 $95,520,600

West of A1A 54 2,527 136,458 $575 $78,463,350

Totals 188 475,076 $325,603,950

Averages 2,527 $1,731,936


202121 REPORT


Due to the production of legal paperwork and other items necessary for closing a sale of

a condo unit, and the time required to complete a unit closing between the developer and a new

unit buyer, not all units can be closed in a week or a month. In addition, some buyers may need

to obtain financing, a process that can take 30 days or more (although most buyers of homes

priced $1.0 million or more in this market pay cash). This is noted among the closings that

occurred at Sabbia Beach and Auberge Beach once these two projects were completed. The rate

of unit closings after completion of construction of these projects is summarized in the tables

below, based on quarter-year (three month) periods from the date the first units were closed:

In the first three months after completion, 78% of the units at Sabbia Beach were sold

and closed to their new owners. This project had 69 units thus a faster closing of a larger

percentage of its pre-sold units was possible. At Auberge Beach, 33% of the units closed in the

first three months after that project was completed, with 81% sold and closed before the end of

the first six months at that 171-unit project, with approximately 70% sold and closed within five

months after completion. It is worth noting that the range of unit retail sale prices at each of

these two projects is similar to (or supporting) the average unit sale price estimated for the

subject under its Low-Rise and High-Rise Scenarios.

After the first six months of closing, the remaining unsold units were sold and closed at

varying rates. After the initial flurry of closings of pre-sold units and units sold just after

Project Name Sabbia Beach

Location 730 North Ocean Blvd.

Pompano Beach

Total Units 69

Price Range $900,000-$3,000,000+

Closings Start 10/31/2019

Quarter Year No. 1 2 3 4

No. of Closings 54 7 1 4

Project Name Auberge Beach

Location 2200 North Ocean Blvd.

Fort Lauderdale

Total Units 171

Price Range $1,400,000-$6,000,000+

Closings Start 9/7/2018

Quarter Year No. 1 2 3 4 5

No. of Closings 57 81 17 2 1


202121 REPORT


completion, the rate of sales is often dependent on the number of units remaining to be sold and

the continuance of marketing efforts that occur by a developer after a project is completed.

Often, when the inventory of unsold units falls over time, a developer may close an on-site sales

office and remove the marketing team, turning the brokerage responsibilities for the remaining

unsold units to an independent local broker. That broker may have other listings to market, thus

marketing efforts for the remaining unsold units at a given project may not receive the same

attention as they did when pre-sales and post-completion sales were occurring.

These rates of sales, upon completion of the subject under each of its two Development

Scenarios, will be considered in estimating the sellout period for each.

Estimate of Sales and Carrying Costs During Sellout

During the sellout period for a multi-unit project such as those outlined in the High-Rise

and Low-Rise Scenarios of this report, additional costs that must be considered that are also

known as indirect or soft costs. They include the closing costs on the sale of each unit, and the

holding costs for the remaining unsold inventory of units until sellout is completed. Closing

costs include commissions to brokers on the sale of units, and administrative costs including title

search and policy expenses at the time of sale. Holding costs include marketing costs and

property taxes for the remaining unsold units until sellout is completed.

The holding costs are derived from industry standards and actual costs to be paid.

Residential brokerage commissions are estimated to be 6.0% of each lot’s sale price, however,

lower commissions to in-house brokers of 3.0% is often negotiated by the developer for pre-

sales and units sold just after completion. Marketing for the remaining unsold lots at the subject

is anticipated to continue by the owner, at a rate of 0.5% of the unsold units’ cumulative value.

After the pre-sold units and immediate sales of units post completion, marketing responsibilities

are transferred over to an outside independent broker.

Administrative and closing costs range from 0% to 3.0% for most residential units sold

in this market. While closings costs are occasionally paid by the buyer, sellers have been

regularly paying for many closing costs to unit buyers as a sales incentive for purchasers in the


202121 REPORT


market. Therefore, administrative and closing costs for the subject are estimated to be 1.5% of

retail sale prices on the lots sold.

The owner of the lots will be liable for their property taxes until they are sold. Total

taxes on the land are currently $624,067.73. This figure equates to $5,158 per unit, which

assigned as a quarterly expense to each unsold unit; taxes on properties with assessed

improvements typically do not occur before one year after completion. This amount will

increase each November by 3% when new assessments and taxes are presented for each year by

the county appraiser and treasurer. Monthly homeowner’s association (HOA) dues on the

unsold units that continue to be held by the developer during the sellout period are estimated to

be $1.00 per square foot for each unit.

Most developers try to target risk as a percentage of the sellout value. Standard returns

sought by these parties for residential projects tend to range from 10% to 25% of the total gross

revenue. With a typical level of risk assigned to the subject under either Development Scenario,

risk of 15% is estimated. However, there is substantially reduced risk on units that were pre-

sold; as such, a lower 5% risk rate is assigned to the units that were pre-sold prior to completion

or those sold shortly after completion occurred.

The discount rate is a rate of return on investment in the physical components of land

and buildings. It is also a rate of return on capital used to discount future payments to present

value. The discount rate provides for the cost of debt borrowing and the costs of equity

borrowing. The rate can be derived via a simple band of investment technique which provides

only for a return on (i.e. interest) only since principal (both debt and equity) will be returned as

the subject lots are sold.

A debt rate of approximately 5.0% is presently indicated based on the availability of debt

capital in the market. Equity capital should be sufficiently attracted at a minimum 12.5% rate,

based the increased risk in investment of new luxury multifamily residential development along

the oceanfront in Broward County and the returns on alternative investments in the market.

Although a yield rate or discount rate cannot be directly calculated, in theory, underwriters have

traditionally estimated it with a band of investment technique. Employing the mortgage equity

band of investment technique, a discount rate can be estimated as follows:


202121 REPORT


In theory, the yield or discount rate is a composition of numerous sub-rates. The

discount rate incorporates four elements of risk: compensation, time preference, management,

and liquidity preference:

Risk is the possibility of decline in income value of real estate. Compensation is

required to offset the chance that income projections will not be realized.

Time preference is represented by the "riskless" rate of return on long term, low risk

investments. It represents the opportunity cost of placing funds in a nearly risk free

investment.

Management is the time, effort and expertise required to oversee an investment. More

complex properties require greater compensation.

Liquidity preference is the compensation for owning a relatively illiquid asset such as

real estate.

A range for each of the elements of compensation are examined as follows:

These two methods produced a narrow range of discount rate indications. Considering

the risk involved in this type of project, its size, location and other factors, a discount rate of

about 8.0% appears appropriate for application to the sellout of the subject units.

Debt: 65% x 5.0% = 3.25%

Equity: 35% x 12.5% = 4.38%

Discount Rate = 7.63%

Low Range High Range

Risk 2.0% 3.0%

Time Preference 2.0% 3.0%

Management 1.0% 1.5%

Liquidity Preference 1.0% 1.5%

Total 6.0% 9.0%


202121 REPORT


Estimate of Net Present Value (Prospective Market Value If Completed)

All of the components are now known in order to estimate the Discounted Net Present

Value under each Development Scenario, which is synonymous with the Prospective Market

Value If Completed as of the current valuation date. It considers the units under each Scenario

and their ARV (retail prices) of each unit over the sellout period which is assumed to begin

September 1, 2021 or the first calendar month following the current valuation date.

High-Rise Scenario

Considering the total of 121 units at the subject under this Development Scenario, and

the rate of closings and sales of units noted after completion of the comparable Sabbia Beach

and Auberge Beach projects, it is estimated that 70 units could be closed in the first quarter-

year period after completion of the subject, with another 37 units sold and closed the

following quarter. The remaining sellout would occur more slowly, similar to the rate noted

at the comparable properties cited above, but with attentive marketing the remaining 14

unsold units could be sold and closed in the following 12-month period. After the first six

months of unit closings, the average retail price of the remaining unsold units can be

estimated to increase by 0.75% per quarter (or 3.0% annually).

The 3.0% in-house brokerage commission rate would apply to the pre-sold and units

sold immediately after completion, with a 6.0% commission rate on the remaining inventory

thereafter. Similarly, marketing costs of 0.5% of the value of the unsold units would apply in

the first six months; these expenses would transfer to the additional previous brokerage

commission rate of 6.0% on sales thereafter. Administrative and closing costs of 1.5% of

sale price of each unit are assessed. Taxes and HOA dues on the remaining unsold inventory

in each quarter-year period follow those that were previously described in this section of the

report. As shown in the following table, the Discounted Net Present Value of the 121 units that

would comprise the subject property under this High-Rise Scenario, if completed as of the

current valuation date of July 2, 2019, is estimated as follows:


202121 REPORT


The resulting Prospective Market Value indication from the discounted sellout in this

High-Rise Scenario for the property, as of the currently valuation date, is $390,880,000

(rounded), or approximately $3,230,413 per unit.

Low-Rise Scenario

This Low-Rise Scenario assumes 188 units would be complete at the subject as of the

current valuation date. Using the rate of closings and sales of units noted after completion of

the comparable Sabbia Beach and Auberge Beach projects, it is estimated that 85 units could

be closed in the first quarter-year period after completion of the subject in this Development

Total Units 121

Total Pre-Sale Contracts 97

Total Sellout/Aggregate of Retail Values (ARV) $455,548,000

ARV per Unit $3,764,860

Current Property Tax/Unit (Q uarterly Total) $1,289

Estimated Q uarterly HO A Dues Per Unit $11,810

SELLO UT SCHEDULE

Quarter Year No. 1 2 3 4 5 6

Starting Month/Year Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22

Units Sold at Start of This Period 97 51 14 10 6 3

Sold/Pre-Sold Unit Closings This Period 70 37 4 4 3 3

Units Sold But Not Closed at End of Period 27 14 10 6 3 0

Total Units Remaining in Inventory 51 14 10 6 3 0

ARV/Unit - Unsold Units $3,764,860 $3,764,860 $3,793,097 $3,821,545 $3,850,206 $3,879,083

Unit Price Appreciation Per Period 0.00% 0.00% 0.75% 0.75% 0.75% 0.75%

TO TAL SELLO UT REVENUES

Contracted Sale Units Expected to Close $263,540,200 $139,299,820 $15,172,386 $15,286,179 $11,550,619 $11,637,248

LESS: SELLO UT EXPENSES

Commissions on Pre-Sold Units 3.0% $7,906,206 $4,178,995 $0 $0 $0 $0

Commissions on Additional Unit Sales 6.0% $0 $0 $910,343 $917,171 $693,037 $698,235

Marketing Costs (% of Unsold Unit Values) 0.5% $960,039 $263,540 $0 $0 $0 $0

Admin. & Closing Costs on Unit Sales 1.5% $3,953,103 $2,089,497 $227,586 $229,293 $173,259 $174,559

Taxes on Remaining Unsold Unis (1) $65,739 $18,587 $13,277 $7,966 $3,983 $0

HOA Dues on Remaining Unit Inventory (2) $602,310 $165,340 $118,100 $70,860 $35,430 $0

Total Sellout Expenses $13,487,397 $6,715,959 $1,269,306 $1,225,290 $905,709 $872,794

NET SALE PRO CEEDS FRO M UNIT SALES $250,052,803 $132,583,861 $13,903,080 $14,060,889 $10,644,910 $10,764,454

Risk/Opportunity Cost on Pre-Sold Units 5.0% $13,177,010 $6,964,991 $0 $0 $0 $0

Risk/Opportunity Cost on Remaining Units 15.0% $0 $0 $2,275,858 $2,292,927 $1,732,593 $1,745,587

LESS: TOTAL RISK ASSESSED $13,177,010 $6,964,991 $2,275,858 $2,292,927 $1,732,593 $1,745,587

NET CASH FLO W $236,875,793 $125,618,870 $11,627,222 $11,767,962 $8,912,317 $9,018,867

PRESENT VALUE FACTOR 8.0% 0.980392 0.961169 0.942322 0.923845 0.905731 0.887971

NET PRESENT VALUE $232,231,132 $120,740,964 $10,956,587 $10,871,773 $8,072,162 $8,008,492

TO TAL NET PRESENT (MARKET) VALUE $390,881,110

RO UNDED $390,880,000

PER UNIT $3,230,413


202121 REPORT


Scenario, with another 75 units sold and closed the following quarter. The remaining sellout

would occur more slowly, similar to the rate noted at the comparable properties cited above,

but with attentive marketing the remaining 28 unsold units could be sold and closed in the

subsequent 12-month period. After the first six months of unit closings, the average price of

the remaining unsold units can be estimated to increase by 0.75% per quarter (3.0%

annually).

The same computations used for brokerage commissions, marketing costs,

administrative and closing costs were used, along with the taxes and HOA dues on the

remaining unsold inventory of units. This produces the following Discounted Net Present

Value of the subject in this Low-Rise Scenario with its 188 units, if completed as of the current

valuation date of July 2, 2019:


202121 REPORT


The resulting Prospective Market Value indication from the discounted sellout in this

Low-Rise Scenario for the property, if development were completed as of the currently

valuation date, is $276,120,000 (rounded), or approximately $1,468,733 per unit.

COST ANALYSIS

An analysis of the development costs to build the subject building and site improvements

under each Development Scenario was undertaken to justify the feasibility of development, i.e.,

provide a basis for profitability for such development under each Scenario. The primary source

Total Units 188

Total Pre-Sale Contracts 150

Total Sellout/Aggregate of Retail Values (ARV) $325,603,950

ARV per Unit $1,731,936

Current Property Tax/Unit (Q uarterly Total) $1,289

Estimated Q uarterly HO A Dues Per Unit $7,581

SELLO UT SCHEDULE

Quarter Year No. 1 2 3 4 5 6

Starting Month/Year Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22

Units Sold at Start of This Period 150 103 28 20 13 6

Sold/Pre-Sold Unit Closings This Period 85 75 8 7 7 6

Units Sold But Not Closed at End of Period 65 28 20 13 6 0

Total Units Remaining in Inventory 103 28 20 13 6 0

ARV/Lot - Pending Sales Expected to Close $0 $0 $0 $0 $0 $0

ARV/Unit - Unsold Units $1,731,936 $1,731,936 $1,744,926 $1,758,012 $1,771,198 $1,784,482

Unit Price Appreciation Per Period 0.00% 0.00% 0.75% 0.75% 0.75% 0.75%

TO TAL SELLO UT REVENUES

Contracted Sale Units Expected to Close $147,214,560 $129,895,200 $13,959,404 $12,306,087 $12,398,383 $10,706,889

LESS: SELLO UT EXPENSES

Commissions on Pre-Sold Units 3.0% $4,416,437 $3,896,856 $0 $0 $0 $0

Commissions on Additional Unit Sales 6.0% $0 $0 $837,564 $738,365 $743,903 $642,413

Marketing Costs (% of Unsold Unit Values) 0.5% $891,947 $242,471 $0 $0 $0 $0

Admin. & Closing Costs on Unit Sales 1.5% $2,208,218 $1,948,428 $209,391 $184,591 $185,976 $160,603

Taxes on Remaining Unsold Unis (1) $132,767 $37,175 $26,553 $17,260 $7,966 $0

HOA Dues on Remaining Unit Inventory (2) $780,843 $212,268 $151,620 $98,553 $45,486 $0

Total Sellout Expenses $8,430,212 $6,337,198 $1,225,128 $1,038,769 $983,331 $803,016

NET SALE PRO CEEDS FRO M UNIT SALES $138,784,348 $123,558,002 $12,734,276 $11,267,318 $11,415,052 $9,903,873

Risk/Opportunity Cost on Pre-Sold Units 5.0% $7,360,728 $6,494,760 $0 $0 $0 $0

Risk/Opportunity Cost on Remaining Units 15.0% $0 $0 $2,093,911 $1,845,913 $1,859,757 $1,606,033

LESS: TOTAL RISK ASSESSED $7,360,728 $6,494,760 $2,093,911 $1,845,913 $1,859,757 $1,606,033

NET CASH FLO W $131,423,620 $117,063,242 $10,640,365 $9,421,405 $9,555,295 $8,297,840

PRESENT VALUE FACTOR 8.0% 0.980392 0.961169 0.942322 0.923845 0.905731 0.887971

NET PRESENT VALUE $128,846,666 $112,517,559 $10,026,650 $8,703,918 $8,654,527 $7,368,241

TO TAL NET PRESENT (MARKET) VALUE $276,117,561

RO UNDED $276,120,000

PER UNIT $1,468,723


202121 REPORT


of development costs for each project was the Marshall Valuation Service (Marshall), an

authoritative guide for developing such costs for buildings and other improvements. Other

ancillary costs were obtained from market sources. When the cost of the site is added to each

total, the result can be compared to the estimated Prospective Market Value under each

Development Scenario; the difference exhibits that potential entrepreneurial profit to a developer

under each Development Scenario.

It is important to note the reasoning for the use of the data from Marshall for application

to the proposed building and site improvements in each Scenario. For ultra-luxury multifamily

residential developments such as those proposed or possible at the subject, the actual costs may

vary based on the contractor used (construction bids will vary from contractor to contractor on

the same project), additional unforeseen indirect costs, etc. Additionally, the Coronavirus

Pandemic caused a halt in economic activity, which is resuming as of August 2021. This caused

a temporary surge in prices for labor and some materials as there was pent-up demand or a

temporary lag in production and delivery. In order to avoid these or other variances that may

occur from project to project or developer to developer, data from Marshall provides the best

“apples-to-apples” comparison of market-oriented costs to the building and site costs for the

development of the subject under each of the two Development Scenarios presented herein.

The cost of land is also an expense that must be incurred and used as a test of

profitability for a proposed development. On December 21, 2016, the subject property was

acquired by Dezer Hillsboro, LLC from Enclave at Hillsboro, LLC, for a price of $28.5 million.

Four years later, or on December 4, 2020, Dezer Hillsboro, LLC sold the subject to Hillsboro

Mile Property Owner, LLC, for a price of $30 million. The address of the buyer in the 2020 sale

of the property matches the corporate office address for The Related Group, a local developer. It

is the appraiser’s understanding that this was not a true “arm’s-length” sale of the property as

Related and Dezer are planning a development of the subject property. Nonetheless, this $30

million represents the current land cost to for the development of the subject under either



202121 REPORT


High-Rise Scenario

Costs in Marshall include all direct building and site improvement costs for various types

of structures, and some indirect costs but excluding taxes, marketing costs, financing costs and

other local fees. Cost data for Luxury Apartments from this source was used for the tower

building improvements on Parcel B including the living area of the dwelling units plus common

space for lobbies, amenities, common corridors, etc. provided by the plans by ARQ. The costs

for the nine detached villa units was acquired from data for luxury single-family homes from

this source, with the costs for the amenity building on Parcel A pulled from costs for

Clubhouses. In each case, the base cost per square foot was obtained for the best-quality type of

each structure type from Marshall; this is consistent with the ultra-luxury features and finish

planned for the property’s development consistent with an average retail sale price of

$3,764,860 per unit.

These base costs were adjusted for various factors such as the developer finish for the

dwelling units (not including finished flooring in living, dining and bedroom areas) consistent in

this market, and for fire safety/sprinkler systems. Various appropriate multipliers were applied

from the Marshall data resulting in a total base cost for the building improvements at this

property.

To this total, the cost of unit balconies, the built-in two-car garages for the villa units,

and the rooftop pools and built-up rooftop decks for the top-floor tower units, the villas and the

amenity building were added along with exterior common deck areas and for impact glass and

other hurricane protection for properties in Palm Beach County. These costs were estimated

based on historic costs at such properties and from data indicated by Marshall. The addition of

these items provided for total costs for the subject’s building structures.

Site costs were obtained from Yard and Subdivision costs noted in Marshall and using

the green coverage and other areas from the plans by ARQ (when available). These include

costs to rebuild the seawall along the Intracoastal Waterway; this can be quite costly, and it

includes providing an inlet in the northwest corner of Parcel A. Personal property, including a

high-end kitchen appliance package for the unit kitchens and the amenity building, is also

provided along with furnishings for the common and operational areas including the tower


202121 REPORT


building lobbies, the amenities building, fitness equipment, pool furniture, and office and

maintenance equipment for staff working for the condominium association.

Finally, additional indirect cost items not included with Marshall were estimated.

Altogether, this calculates to a total estimated construction costs for the site and building

improvements proposed under the High-Rise Scenario of $255,460,000 (rounded):


202121 REPORT


Gro s s B uild ing A re a to Hig h-R is e R e s ide nt ia l (S F ) 5 17 ,6 9 5

Gro s s B uild ing A re a o f Hig h-R is e Ga ra g e (S F ) 18 7 ,0 3 6

N um be r o f Hig h-R is e Units 112

Gro s s B uild ing A re a to Villa Units (S F ) 3 3 ,9 2 0

N um be r o f Villa Units 9

C o m po ne nt A m e nity B ldg . Ga ra g e Villa Units Luxury A pts .

C la s s / Type C la s s C / Exc e lle nt C la s s A -B C la s s C / VI C la s s A / Go o d

S e c t io n/ P a g e N o . 11/ 3 0 11/ 19 12 / 2 7 11/ 15

D a ta D a te N o v . 2 0 2 0 N o v . 2 0 2 0 A ug . 2 0 2 0 N o v . 2 0 2 0

Bas e Co s t P er SF $ 206.00 $ 112.00 $ 510.00 $ 283.00

Adjus t fo r Lack o f F inis hed Flo o ring $ 0.00 $ 0.00 ($ 20.00) ($ 20.00)

Adjus t fo r Sprinkle r Sys tem $ 4.00 $ 2.00 $ 4.25 $ 2.00

A djus te d B a s e C o s t P e r S F $ 2 10 .0 0 $ 114 .0 0 $ 4 9 4 .2 5 $ 2 6 5 .0 0

Adjus tments :

Area Multiplie r (Avg.) 1.000 1.000 1.000 1.000

Sto ry Height Multiplie r 1.000 0.973 1.000 1.000

Building Height Multiplie r 1.000 1.000 1.000 1.060

Current Multiplie r 1.11 1.11 1.10 1.11

Lo cal Multiplie r 0.91 0.91 0.91 0.91

A djus te d B a s e C o s t $ 2 12 .0 0 $ 112 .0 0 $ 4 9 5 .0 0 $ 2 8 4 .0 0

SF o f Building Area 9,294 187,036 33,920 517,695

To ta l B a s e C o s t - P e r C o m po ne nt $ 1,9 7 0 ,3 2 8 $ 2 0 ,9 4 8 ,0 3 2 $ 16 ,7 9 0 ,4 0 0 $ 14 7 ,0 2 5 ,3 8 0

To ta l B a s e C o s t - A ll B uild ing s $ 18 6 ,7 3 4 ,14 0

Add:

$ 2,800,000

Ro o fto p P o o ls & Built-Up Ro o f Decks (P entho us es , Villas & Amenity Bldg.) $ 2,700,000

Exterio r Co mmo n Area Decks $ 1,000,000

Villa Garages $ 250,000

Hurricane P ro tec tio n/Impact Windo ws $ 12,100,000

To ta l D ire c t C o s ts - B uild ing S truc ture s $ 2 0 5 ,5 8 4 ,14 0

To ta l S ite Impro vements

Villa Unit P a tio s $ 150,000

Gro und Level Swimming P o o ls - High Ris e $ 200,000

Gro und Level Swimming P o o ls - Villa Units & Amenity Building $ 500,000

Tennis Co urts & P avilio n $ 400,000

Intraco as ta l Do cks & Seawall $ 5,000,000

P aved Driveways & Exterio r P arking $ 2,000,000

Beach Acces s P a thway $ 250,000

Tro pica l Lands caping $ 2,000,000

Lands caping Irriga tio n Sys tem $ 400,000

To ta l S ite Im pro v e m e nts $ 10 ,9 0 0 ,0 0 0

To ta l P ers o na l P ro perty

Res identia l Unit & Amenity Building Appliances $ 1,225,000

Lo bby, Recrea tio n/Gym, P o o l, Office & Maintenance $ 500,000

To ta l P e rs o na l P ro pe rty $ 1,7 2 5 ,0 0 0

To ta l D ire c t C o s ts $ 2 18 ,2 0 9 ,14 0

Additio na l Indirec t Co s ts

Taxes During Co ns truc tio n $ 1,250,000

Impact/Tap Fees $ 3,500,000

Marke ting $ 5,000,000

A ddit io na l Indire c t C o s t To ta l $ 9 ,7 5 0 ,0 0 0

Financ ing Co s ts

Inte res t Res erve $ 25,000,000

Financ ing Fees $ 2,500,000

F ina nc ing C o s t To ta l $ 2 7 ,5 0 0 ,0 0 0

To ta l D ire c t & Indire c t C o s t Via M a rs ha ll $ 2 5 5 ,4 5 9 ,14 0

R o unde d $ 2 5 5 ,4 6 0 ,0 0 0

P e r Unit $ 2 ,111,2 3 3

High-Ris e Unit Balco nies


202121 REPORT


Low-Rise Scenario

The costs from Marshall are also primarily used to estimate the building and site costs

for the appraised subject considering the improvements that may occur in this Development

Scenario. The average retail price per unit in the Low-Rise Scenario is estimated to be

$1,731,936, thus the highest-quality luxury multifamily residential (low-rise) building costs

were used in this analysis. The gross building area for the building improvements could be

calculated from the subject’s site size and the zoning restrictions that are in place for this

property. It includes the living areas for the dwelling units plus common areas that would

include a clubroom, fitness center, and other common amenities for residential as well as space

for lobbies, common corridors, etc. However, the square footage of the garage that would

accompanying this low-rise development is unknown; therefore, these costs were provided as a

lump sum figure based on those from the High-Rise Scenario but considering a garage with 376

spaces (2 per dwelling unit) rather than 232 spaces.

The cost of unit patios or balconies was added to that total, along with the cost of

hurricane protection elements. Elevator costs were also added as Marshall’s Section 12 base

costs for low-rise multifamily residential buildings did not include the cost of elevators.

Site costs were similar to those for the development in the High-Rise Scenario, although

there would likely be only one or two swimming pools with pool decks (one on each Parcel) in

the Low-Rise Scenario. The seawall costs would be the same under both Development

Scenarios. Personal property costs include a high-end kitchen appliance package for the

dwelling units and the property’s common clubroom, along with furniture and equipment for

reduced lobby areas and the number of pools requiring pool furniture.

Additional indirect costs were also included including taxes, marketing, impact fees

and financing costs. This provides for cumulative building and site costs for the property

under the Low-Rise Scenario of $157,660,000 (rounded), as presented below: (rounded):


202121 REPORT


Gro s s B uild ing A re a to Lo w-R is e R e s ide nt ia l (S F ) 5 3 8 ,2 6 3

Gro s s B uild ing A re a o f Hig h-R is e Ga ra g e (S F ) N / A

N um be r o f Lo w-R is e Units 18 8

N o . o f Ga ra g e P a rking S pa c e s (2 pe r Unit ) 3 7 6

C o m po ne nt Ga ra g e ; Luxury M F R

C la s s / Type Lum p S um C la s s C / Exc e lle nt

S e c t io n/ P a g e N o . B a s e d o n 12 / 16

D a ta D a te Hig h-R is e C o s t A ug . 2 0 2 0

Bas e Co s t P er SF $ 149.00

Adjus t fo r Lack o f F inis hed Flo o ring ($ 20.00)

Adjus t fo r Sprinkle r Sys tem $ 2.00

A djus te d B a s e C o s t P e r S F $ 13 1.0 0

Adjus tments :

Area Multiplie r (Avg.) 1.000

Sto ry Height Multiplie r 1.000

Building Height Multiplie r 1.000

Current Multiplie r 1.10

Lo cal Multiplie r 0.91

A djus te d B a s e C o s t $ 13 1.0 0

SF o f Building Area 538,263

To ta l B a s e C o s t - P e r C o m po ne nt $ 3 0 ,0 0 0 ,0 0 0 $ 7 0 ,5 12 ,4 5 3

To ta l B a s e C o s t - A ll B uild ing s $ 10 0 ,5 12 ,4 5 3

Add:

$ 4,700,000

Eleva to rs $ 200,000

Hurricane P ro tec tio n/Impact Windo ws $ 15,000,000

To ta l D ire c t C o s ts - B uild ing S truc ture $ 12 0 ,4 12 ,4 5 3

To ta l S ite Impro vements

Co mmo n Swimming P o o l & P o o l Deck $ 100,000

Intraco as ta l Do cks & Seawall $ 5,000,000

P aved Driveways & Exterio r P arking $ 2,000,000

Beach Acces s P a thway $ 250,000

Tro pica l Lands caping $ 2,000,000

Lands caping Irriga tio n Sys tem $ 400,000

To ta l S ite Im pro v e m e nts $ 9 ,7 5 0 ,0 0 0

To ta l P ers o na l P ro perty

Res identia l Unit & Amenity Building Appliances $ 1,900,000

Lo bby, Recrea tio n/Gym, P o o l, Office & Maintenance $ 350,000

To ta l P e rs o na l P ro pe rty $ 2 ,2 5 0 ,0 0 0

To ta l D ire c t C o s ts $ 13 2 ,4 12 ,4 5 3

Additio na l Indirec t Co s ts

Taxes During Co ns truc tio n $ 1,250,000

Impact/Tap Fees $ 3,500,000

Marke ting $ 4,000,000

A ddit io na l Indire c t C o s t To ta l $ 8 ,7 5 0 ,0 0 0

Financ ing Co s ts

Inte res t Res erve $ 15,000,000

Financ ing Fees $ 1,500,000

F ina nc ing C o s t To ta l $ 16 ,5 0 0 ,0 0 0

To ta l D ire c t & Indire c t C o s t Via M a rs ha ll $ 15 7 ,6 6 2 ,4 5 3

R o unde d $ 15 7 ,6 6 0 ,0 0 0

P e r Unit $ 1,3 0 2 ,9 9 5

Unit P a tio s & Balco nies


202121 REPORT


POTENTIAL PROFIT ANALYSIS

A net present (market) value, also known as the Prospective Market Value for each of

the two Development Scenarios, was estimated if each development were completed as of the

current valuation date of August 8, 2021. Development costs under each Scenario were

primarily provided by the Marshall Valuation Service, an authoritative guide for developing

such costs for buildings and other improvements. Other ancillary costs were obtained from

market sources, and the developers’ cost of the site was also obtained. These resulting costs

can be compared to the estimated Prospective Market Value (if completed) under each

Development Scenario; the difference exhibits that potential entrepreneurial profit to a developer

under each Development Scenario, and is illustrated in the table below:

The entrepreneurial profit, as a percentage of total development costs, is estimated to be

37% in the High-Rise Scenario, and 47% in the Low-Rise Scenario. This provides for ample

financially feasibility for development of the subject under either Scenario. However, a greater

total amount of profit may be realized under the High-Rise Scenario; this entrepreneurial profit

estimate is $16,960,000 greater than that estimated in the Low-Rise Scenario.




Land Cost $30,000,000 $30,000,000





A D D E N D A

EXHIBIT A

Exhibit A

Subject Property Photographs

~PHOTOGRAPHS OF SUBJECT~

202121

Multifamily Residential Site, 1174-1185 Hillsboro Mile, Hillsboro Beach, FL

Facing Northwest at Western Parcel A of the Subject from State Road A1A

Facing Southwest at Western Parcel A of the Subject from State Road A1A


202121


Facing Northeast at Eastern Parcel B of the Subject from State Road A1A

Facing Southeast at Eastern Parcel B of the Subject from State Road A1A


202121


View of the Center Interior of Eastern Parcel B Toward the Coastal Construction Line

EXHIBIT B

Exhibit B

Broward County Regional Analysis

BROWARD COUNTY REGIONAL ANALYSIS OVERVIEW

Overview

Broward County, on Florida's southeastern coast, encompasses 1,197 square miles with 23

miles of Atlantic Ocean beachfront and 300 miles of navigable waterways. The county includes 31

incorporated municipalities, of which Fort Lauderdale is the largest, followed by Pembroke Pines,

Hollywood and Pompano Beach. Broward is bounded on the west by Florida’s Everglades

(occupying 2/3 of the county) and the Atlantic Ocean to the east. It is part of the tri-county South

Florida region which includes Palm Beach County to the north and Miami-Dade County to the

south, with a total combined regional population exceeding 6.2 million as of 2019.

The following regional analysis provides much of the data occurring during the past decade

until the onset of the Coronavirus Pandemic in Broward County in March 2020. In some areas of

the underlying economy, the adverse effects of the Pandemic on social, medical and economic

conditions are known and reported by third-party sources. Otherwise, a broader description of the

Pandemic and its effects are presented below:

Transportation

Four interstate highways along with Florida’s Turnpike are integrated into the local street

network of Broward County. The County is dissected north/south by Interstate 95 (I-95) and

Florida's Turnpike. Other major north-south thoroughfares include A1A, Federal Highway (US 1),

State Road 7 (SR 7/US 441), and University Drive (State Road 817). In addition, Interstate 75 (I-

75) provides a link from its interchange with Interstate 595 (I-595) and the Sawgrass Expressway

into Miami-Dade County and access across the peninsula to the west coast of Florida. The

Sawgrass Expressway, a 23-mile toll road, traverses the western edge of Broward County from the

I-75/I-595 interchange northward to Coral Springs and then eastward to Deerfield Beach east of

Florida’s Turnpike. In addition, I-595 provides east/west corridor access from I-75 and the

Sawgrass Expressway on the west to Port Everglades and Fort Lauderdale/Hollywood International

Airport and US 1 to the east.

The Tri-Rail commuter rail system links Miami-Dade, Broward and Palm Beach Counties.

Stations are located as far north as Okeechobee Boulevard (in Palm Beach County) and extend to

Miami International Airport. Florida East Coast Industries started the Brightline, a high-speed rail

service along its rail right-of-way with connections that will eventually carry passengers between

Miami and Orlando in just over three hours. The route and stations are now operating between the

downtown areas Miami and West Palm Beach, with a stop in downtown Fort Lauderdale. New

stations were recently announced for Boca Raton, Port Miami and Aventura, while Disney recently

negotiated a further expansion of this rail line to its Central Florida theme parks. Brightline shut

down operations in 2020 due to the Coronavirus Pandemic, but continues to work on new stations

and expansion indicating its intent to return in the Fall of 2021 as economic activity is anticipated to

return to normal levels.

The Seaboard Coastline and Florida East Coast Railroads provide freight service in the

County. Greyhound and Trailways provide intra- and intercity bus service for passenger and freight

traffic. The Broward County Transit Authority provides public bus service throughout the county

and has recently introduced limited stop services along the busy US 1 and US 441 routes.

The Fort Lauderdale/Hollywood International Airport (FLL) was the 18th busiest airport in

the U.S. in passenger traffic in 2019. That year, there were more than 350 daily departures to 84

U.S. cities and 33 countries. In 2019, FLL generated over 255,000 direct and indirect jobs and had

an annual economic impact of $37.5 billion. Passenger traffic growth at FLL was strong through

2019, as noted in the following table:

With the onset of the Coronavirus Pandemic in March 2020 in Broward County, these

numbers tumbled to just over 100,000 passengers handled at FLL in April of that year. With more

Americans getting vaccinated in the first months of 2021, it is expected that passenger numbers will

slowly recover at FLL. Although passenger totals for the first four months of 2021 remain lower

than the same period in 2020, that period in 2020 included the months of January and February or

before the Pandemic began to adversely affect these figures.

International Total

Passengers % of Passengers %

Period (000s) Total (000s) Change

2014 4,660 18.9% 24,648

2015 5,500 20.4% 26,941 9.3%

2016 6,055 20.7% 29,205 8.4%

2017 7,183 22.1% 32,511 11.3%

2018 8,608 23.9% 35,963 10.6%

2019 8,844 24.1% 36,748 2.2%

2020 3,122 18.9% 16,484 -55.1%

YTD Apr. 2019 973 7.4% 13,107

YTD Apr. 2020 1,940 22.6% 8,570 -34.6%

YTD Apr. 2021 3,131 39.7% 7,885 -8.0%

Located just west of Federal Highway (US 1) and south of I-575, the airport is in the center

of a unique multi-modal transportation complex. The combination of two railroads on either side,

the Airport, a deep-water seaport (the Port of Everglades, just two miles north and east from the

airport), and the highway system network (including I-95 and I-595 linking to Florida’s Turnpike)

provide easy access to Miami, West Palm Beach and other destinations in South and Central

Florida.

Port Everglades, the largest seaport on Florida's lower east coast (2,190 acres including 448

acres of submerged land), is located at the adjoining city limits of Fort Lauderdale, Hollywood, and

Dania Beach. Port Everglades generated more than $32 billion worth of economic activity in 2019,

and generated more than 230,000 jobs statewide. The port generated the highest revenues of any

seaport in Florida at more than $170 million, up from just over $153 million in fiscal year 2015.

The seaport handled nearly 6.8 million TEUs (20-foot equivalent units, the standard measurement

for containers) in fiscal year 2019 and while the number of TEUs handled rose from about that

figure in fiscal year 2015, the Pandemic adversely affected the total TEUs handled in 2020,

dropping that number to just over 5.7 million for fiscal year 2020.

Port Everglade’s cruise port handled nearly 3.9 million passengers in fiscal year 2019, up

from 3.78 million in fiscal year 2015. However, this total plummeted by zero passengers by April

2020 due to the onset of the Coronavirus Pandemic in Broward County the previous month. Since

then and through September 2020, there were only 1,644 passengers handled in July 2020. For all

of fiscal year 2020, almost 2.54 million passengers were noted at this cruiseport facility.

Port Everglades has a $1.6 billion expansion underway that are expected to be completed by

2025. This includes a $471 million cargo berth expansion, deepening the port’s navigation channels

from 42 to 48-50 feet, addition a cruise port parking garage, two new logistical centers with more

than 300,000 square feet, and petroleum slip improvements.

Population

Data pertaining to population growth in Broward County, the State of Florida and the United

States are summarized in the following table.

Year Broward County Florida

2000 1,623,106 15,982,813

2010 1,748,146 18,804,564

2019 Est. 1,952,778 21,477,737

According to the U.S. Census Bureau, Broward County’s population grew by 11.7% from

2010 to 2019, which is slower than the statewide growth rate of 14.2% during this period but still

quite healthy. Future growth is also limited by natural boundaries that include the Atlantic Ocean to

the east and the environmentally-protected Everglades to the west of U.S. Highway 27 and the

Sawgrass Expressway. Over the last decade, development growth in Broward County began to

reach its western-most boundary, creating a “barrier-to-entry” market for future development that

will continue to limit population growth.

Economic Fundamentals

The Broward County economy has historically depended on tourism, retirees and

construction. During the 1980s, the County began to develop a manufacturing base (non-

construction) which diversified the local economic structure. During the last three decades,

Broward County’s employment has shifted significantly toward services of businesses and residents

while also meeting the increasing demand for education and health services. Manufacturing has

followed the national and statewide trend of declining employment while the population-driven

construction industry continued to show significant long term strength. The largest employment

gains in Broward County’s private sectors from 2000-2010 were in the professional and business

services sector. As of 2019, the largest employment sectors in Broward County were office and

Administrative Support, Sales, Food Preparation and Serving, Transportation and Material Making,

Healthcare, and Business and Financial Services.

Source: Florida Research & Economic Information Database Application

Tourism continues to play a major role in Broward County’s economy, and-generated tax

revenues totaling $86.9 million in 2018, a 33.5% increase over the previous year. According to the

Greater Fort Lauderdale Convention and Visitors Bureau, hotel revenues were 1.3 billion that

year, with over 8.88 million overnight stays. The Greater Fort Lauderdale/Broward County

Convention Center, located adjacent to Port Everglades, is currently undergoing a $1 billion

expansion to 1.2 million square feet that will include a 350,000-square foot exhibit hall, a 65,000-

square foot ballroom, 50,000 square feet of meeting space, and an 800-room convention center

headquarter hotel under the Omni flag.

The regional hospitality market experienced a very strong February 2020 performance that

was enhanced by the staging of the Super Bowl in neighboring Miami-Dade County. However,

with the onset of the Coronavirus Pandemic in March 2020, the hotel/hospitality industry was

perhaps the hardest hit among all economic and employment sectors in Broward County. Total

employment in the county’s hospitality industry fell from nearly 100,000 in February 2020 to just

over half that total in May 2020. Since some re-openings have occurred, this figure has climbed but

still remains much lower at just over 68,000 employed in September 2020. Hotel occupancy in

September 2020 was down nearly 25% from the same period last year, with rates falling by more

than 9% and RevPAR (Revenues Per Available Room) down more than 30% during this period.

The Great Recession that occurred in 2008-2010, and its accompanying housing market

crash, hit the county very hard and unemployment rates hovered over 9%. Statistics since 2012

show significant improvement with rates dropping to 5.1% in 2015 and 3.0% by 2019. The decline

came despite an increase in job seekers as the long term unemployed rejoin the ranks. In Broward

County nearly 130,000 new positions were added in 2019.

With the outbreak of the Coronavirus in the U.S. in mid-March 2020, businesses closed and

unemployment soared upward on all levels (U.S., Florida and locally). These trends in the

unemployment rate are presented in the next table:

Date

Unemployment

Rate

Florida

Unemployment

Rate

Broward County

February 2020 2.8% 2.9%

May 2020 13.5% 15.2%

May 2021 4.9% 5.2%

Since unemployment peaked in the Spring of 2020, some businesses have been allowed

to re-open and hire employees back, while others found work elsewhere. This eased the

unemployment rate back into single digits near the end of 2020, but still above rates seen over

the past several years.

Broward County’s economy is concentrated in the service sectors proportionate to the

national economy. Employment projections indicate the most rapid growth is expected in the

services industry. Services and trade should continue to serve as the backbone of the Broward

County economy. Business firms find that Florida, in general, and Broward County, in

particular, offer a favorable business climate. Florida's corporate income tax rate is ranked one of

the lowest in the nation, and the state has no city or state personal income tax . The local tax

structure places the county in a position of competitive strength when compared with other markets

in the nation. Officials have the authority to provide many business incentives. Below is a list of

major private-sector employers in Broward County in 2019.

Rank Employer Employees Product/Service

1 Nova Southeastern University 6,234 Higher Education

2 First Service Residential 5,400 Real Estate Management

3 HEICO 4,532 Aviation Equipment

4 Spirit Airlines 3,790 Airline

5 American Express 3,500 Financial Services & Travel

6 AutoNation 3,000 Automotive Retailer

7 Mednax 2,636 Healthcare Services

8 UKG 1,800 Computer Software

9 The Castle Group 1,790 Real Estate

10 JM Family Enterprises 1,719 Automotive Retailer Source: Greater Fort Lauderdale Alliance

The largest number of public sector employees in the county can be found at the Broward

County Schools (34,218), Broward County government (12,787), and the Memorial Healthcare

System (11,200).

The median household income for Broward County for 2019 was estimated to be $48,240.

Conclusion

Broward County is at the center of a tri-county regional market whose population passed 6.2

million persons in 2019. Employment and income growth continued in this market after the

recovery from the effects of the Great Recession from 2008-2010, with rising visitation in this

popular tourist destination. This fueled demand for different types of real estate in this market

including residential, commercial, industrial and hospitality.

However, the outbreak of the Coronavirus Pandemic in March 2020 caused a severe retreat

in the previously-occurring economic activity in the region including Broward County. Businesses

were forced to close through May of that year, causing a sharp rise in unemployment. Most

business activity has been allowed to resume, providing for a reduction in unemployment but

hospitality businesses such as hotels, restaurants, air and cruise lines were especially hard hit.

While the county’s underlying economic fundamentals and infrastructure have a solid base, a full

recovery is not expected until the underlying adverse effects on the social, health and economic

caused by the Pandemic can be extensively resolved.

EXHIBIT C

Exhibit C

High-Rise Scenario Architectural Plans by ARQ

EXHIBIT C

Architectural Plans considered in this report are from Arquitectonica, a Miami-based

architectural firm, and are dated July 29, 2021. They include an ALTA site survey by

Schebke Shiskin dated dated July 14, 2021. Both were relied upon in the analysis of the

subject considering its High-Rise Scenario of development as outlined in this report. A

copy of these architectural plans and the survey are included in the appraiser’s workfile

for this report as their inclusion in the Addenda of this report was obstructed by the

presence of embedded Signatures in their accompanying PDF file format. The

appraiser has retained a copy of these architectural plans and their accompanying

survey in case the reader of this report requires them in order to understand the

context of the hypothetical High-Rise development contemplated in the analysis

contained herein.

EXHIBIT D

Exhibit D

Engagement Letter


July 29, 2021

Mr. Mac Serda, lCMA-CM Town Manager The Town of Hillsboro Beach, FL 1210 Hillsboro Mile Hillsboro Beach, Florida 33062

Dear Mr. Serda:

This letter will serve as my proposal to perform appraisal services and prepare an appraisal of the fee simple interest on the real property referenced as follows:

Description: Approximately 10.4 acres of land straddling State Road AlA, and located at 11 74-1184 Hillsboro Mile in Hillsboro Beach,

Broward County, Florida

Property Tax Folio Numbers (Broward County Property Appraiser): 48-43-08-13-0010 48-43-08-13-0020 48-43-08-13-0012 48-43-08-13-0021 48-43-08-13-0013 48-43-08-13-0022 48-43-08-13-0014 48-43-08-13-0023 48-43-08-13-0015 48-43-08-13-0024 48-43-08-13-0016 48-43-08-13-0030

[ will prepare a PDF copy of an appraisal report that sets forth the analysis, findings and conclusions of Hypothetical Market Value as of the current valuation date, under the valuation Scenarios set forth as fo !lows:

Scenario 1:

Scenario 2:

Hypothetical Market Value of a low-rise (two- to three-story) multifamily residential deve lopment to this property, at its highest and best use. This value assumes that deve lopment of these improvements is complete. Hypothetical Market Value of a high-rise (15 story) multifamily development, if complete. [f developed as a "for-sale" condominium project, this hypothetica l value will represent the net present value of the sellout of the individual residential condominium units.

2000 NORTH BA YSHORE DIUVE # 11 03, MIAM I, FL 33 137 •PHONE (305) 776-6 131

A TLAN11C BLUE CONSULTING, INC. REAL ESTATE ADVISORY & VALUATION SERVICES

Additional scope of work includes estimating the difference between Hypothetical Market Value and cost of the project described in each of the two valuation Scenarios above, including the costs of land, site and building improvement costs. This difference represents the anticipated profit for a speculative developer of the described project in each of these two valuation Scenarios.

Please carefully note that this valuation may not include an "as is" valuation of the property at its highest and best use, as the property is vacant land subject to zoning and other restrictions that currently may or may not allow for development under either hypothetical valuation Scenario stated above.

I understand that the intended use of the appraisal is for in-house decision making by you, the client, in negotiations with potential developers seeking development approvals for this property. The analysis will consider the physical aspects of the property and assess its competitive position in the market. l will employ the traditional valuation techniques considered appropriate to this valuation problem. The analyses and report will be descriptive in the presentation of data and analysis in order to provide the value estimates therein, and conform to the Uniform Standards of Professional Appraisal Practice (USPAP), the Supplemental Standards issued by the Appraisal Institute. [request that the following items (more may be required later) be made available for review at the earliest convenience:

l. The number of residential units and square footage of building area contemplated for development under both valuation Scenarios noted above;

2. Any preliminary site plans for development of the property under either scenario noted above; 3. A survey of the appraised property; 4. Any environmental studies conducted on the property.

I anticipate completion of the assignment within 30 days ofthe receipt of the materials requested above. The total fee will be $6,000 which will be due upon delivery of the written report. The fee for court testimony is based on $250 per hour, including testimony and preparation time. This proposal is submitted based on my current schedule of commitments. It may be necessary to alter the completion date unless the assignment is authorized in the near future. You may authorize this assignment by signing and returning a copy ofthis letter. I thank you for contacting me and I look forward to working with you.

Sincerely,

ATLANTIC BLUE CONSULTING, fNC.

~ J Guthrie (Jay) Mlinar, MAl, SRA President State-Certified General Appraiser RZ1916

Agreed and Accepted The Town of Hillsboro Beach

SigJtattrrL,h . MAf .. ............... . Name /;://,',...~ ;t1. 5=e)),4-

Title /1~c,W-

Date:

EXHIBIT E

Exhibit E

Appraiser’s Qualifications

QUALIFICATIONS

J GUTHRIE (JAY) MLINAR, MAI, SRA

Atlantic Blue Consulting, Inc.

Academic

B.B.A., Southern Methodist University, Dallas, Texas, 1983

Experience

2021-Present: President, Atlantic Blue Consulting, Inc.

2012-2020: Managing Director (since 2019), Blazejack & Co., Miami, FL

1995-2012: Appraiser, Clobus, McLemore & Duke, Inc., Fort Lauderdale, FL

1994-1995: Appraiser, Investors Research Associates, Miami, FL

1993-1994: Appraiser, Cushman & Wakefield, Miami, FL

1991-1993: Appraiser, Bach Thoreen McDermott, Inc., Houston, TX

1988-1991: Appraiser, Georgia Federal Bank, Atlanta, GA

1983-1988: Appraiser, Porcher, Bond, Wilk, Allison, Inc., Dallas TX

1982-1983: Salesperson, Helena Underwood Realtors, Dallas, TX

Mr. Mlinar has been active as a real estate appraiser/analyst on a full-time basis

since 1983. During this period, his real estate experience included highest and best

use and market rent analyses, market studies, consulting and evaluation of

professional and medical office buildings, hotels/motels, apartments, residential and

commercial condominiums, warehouses, vacant land, single-family homes, retail

stores, restaurants, shopping centers, mixed-use projects, golf courses, self-storage

facilities, full-service marinas and special purpose properties.

Since 1993, these assignments were primarily concentrated in South Florida, but

with extensive work also completed on properties located throughout the state and

across the U.S. During his career, Mr. Mlinar has completed appraisals, analyses

and consulting on properties located in 21 states, the U.S. Virgin Islands, and in

Uruguay. Since 2012, Mr. Mlinar most recently worked for Blazejack & Company,

initially as a consultant and was appointed Managing Director of the firm in 2019.

At the end of 2020, Thomas Blazejack retired, and handed the real estate advisory

and valuation functions of Blazejack & Company to Mr. Mlinar, who now provides

those services to their clients under his firm, Atlantic Blue Consulting, Inc.

Designations and Licenses

MAI Member, Appraisal Institute, currently certified

SRA Member, Appraisal Institute, currently certified

Florida State-Certified General Real Estate Appraiser RZ1916

Florida Licensed Real Estate Salesperson SL654868

appraisal of real property report 202121 prepared for

Documents