RFP_GRM220445_Development_Opportunity_-_1749_W._Silver_Springs_Boulevard_and_105_SW_19th_Avenue_-_Exhibit_C_-_Property_Appraisal.pdf

1107 E. Silver Springs Boulevard, Unit 9 Ocala, Florida 34470 Phone: (352) 433-2580 Fax: (352) 433-2581 Website: www.gibboneyappraisals.com

Nathan R. Gibboney, MAI State-Certified General Real Estate Appraiser #RZ2580

Real Estate Appraisers, Consultants & Market Analysts

Appraisal Report

Appraisal of:

19,602 SF

OF VACANT LAND

Ocala, Florida

Location of Subject Property:

Northeast Corner of W. Silver Springs Boulevard (SR 40) and SW 19th Avenue, Ocala, Marion County, Florida

Prepared for:

Gus Gianikas, CRA Manager City of Ocala Growth Management Department

201 SE 3rd Street, 2nd Floor Ocala, Florida 34471

Prepared by:

Gibboney & Associates

Nathan R. Gibboney, MAI State-Certified General Real Estate Appraiser

License No. RZ2580

Exhibit C - Property Appraisal Contract # GRM/220445

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1107 E. Silver Springs Boulevard, Unit 9 Ocala, Florida 34470 Phone: (352) 433-2580 Fax: (352) 433-2581

Website: www.gibboneyappraisals.com

Nathan R. Gibboney, MAI State-Certified General Real Estate Appraiser #RZ2580

Real Estate Appraisers, Consultants & Market Analysts

September 16, 2022

Gus Gianikas, CRA Manager City of Ocala Growth Management Department 201 SE 3rd Street, 2nd Floor Ocala, Florida 34471

Re: 19,602 SF (.45 AC) of Vacant Land; Northeast Corner of W. Silver Springs

Boulevard (SR 40) and SW 19th Avenue, Ocala, Marion County, Florida

Dear Mr. Gianikas:

As requested, I have prepared an appraisal report for the subject property that is identified as approximately 19,602 SF, or .45 acres, of vacant land located at the northeast corner of the intersection of W. Silver Springs Boulevard (SR 40) and SW 19th Avenue in Ocala, Marion County, Florida. The property is further identified as Parcel Nos. 2260-110-023 and 2260-110-026 and includes additional frontage along SW 1st Street.

This appraisal report includes summarized studies of relevant factual data necessary to arrive at the market value estimate of the fee simple interest of the subject property, as of the effective date of valuation indicated herein. The following report provides the legal description and summarized descriptions of the subject's market area (region and neighborhood), site, and any improvements, as well as all market analyses required for the conclusion of market value.

The subject property was most recently inspected and photographed on September 8, 2022, which corresponds with the effective date of valuation. The purpose of the inspection was to study the physical characteristics of the subject property and its interrelationship with surrounding economic influences. As well, attention has been given to other factors that may impact the market value of the subject property within its region and neighborhood.

This appraisal report and its contents were prepared according to appraisal standards and reporting guidelines provided by the Uniform Standards of Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the Appraisal Foundation, and the Appraisal Institute. The client is the City of Ocala. The intended use of this appraisal is to determine market value for internal decision-making purposes. The intended user of the appraisal is the City of Ocala. I have not provided any services regarding the subject property within the prior three years, as an appraiser or in any other capacity.

The conclusion of market value is not subject to any additional extraordinary assumptions or hypothetical conditions except as stated within the Assumptions and Limiting Conditions section of this appraisal report.

Exhibit C - Property Appraisal

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Gus Gianikas, CRA Manager City of Ocala Growth Management Department September 16, 2022 Page Three

Based upon the market analyses presented within this appraisal report, as well as my investigations and studies, it is my opinion that the market value estimate of the fee simple interest of the subject property, as of September 8, 2022, was:

ESTIMATE OF MARKET VALUE $90,000

As Is, As of September 8, 2022

The following report presents all of the relevant factual data that resulted in the estimate of market value for the subject property.

Respectfully submitted, Gibboney & Associates

State-Certified General Real Estate Appraiser License No. RZ2580

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TABLE OF CONTENTS

LOCATIONS MAPS

PHOTOGRAPHS

SUMMARY OF IMPORTANT FACTS AND CONCLUSIONS

SCOPE OF WORK

PURPOSE OF THE APPRAISAL

INTENDED USE OF APPRAISAL AND INTENDED USER

PROPERTY RIGHTS APPRAISED

APPRAISAL DATES

DEFINITION OF VALUE

IDENTIFICATION OF THE PROPERTY

LEGAL DESCRIPTION

PROPERTY OWNERSHIP

HISTORY OF THE PROPERTY

TAXES AND ASSESSMENTS

ZONING AND LAND USE PLANS

SITE DESCRIPTION AND ANALYSIS

MARKET ANALYSIS

HIGHEST AND BEST USE ANALYSIS

PROCESS OF ANALYSIS AND VALUATION

SALES COMPARISON APPROACH

MARKETING AND EXPOSURE TIME

CERTIFICATION

ASSUMPTIONS AND LIMITING CONDITIONS

QUALIFICATIONS OF THE APPRAISER

ADDENDA

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LOCATION MAPS

REGIONAL MAP

COUNTY MAP

SUBJECT

N

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LOCATION MAPS

NEIGHBORHOOD MAP

AERIAL MAP

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PHOTOGRAPHS

Date Taken: September 8, 2022

View of the subject site from W. Silver Springs Boulevard (SR 40) facing northeast.

View of the subject property from SW 1st Street facing south.

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View of W. Silver Springs Boulevard (SR 40) facing east. The subject is situated to the left of the photo.

View of W. Silver Springs Boulevard (SR 40) facing west. The subject is situated to the right of the photo.

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View of SW 19th Avenue facing north from SR 40. The subject is situated to the right of the photo.

View of SW 1st Street facing east from SW 19th Avenue. The subject is situated to the right of the photo.

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SUMMARY OF IMPORTANT FACTS AND CONCLUSIONS

Intended Use of Appraisal

Determine market value for internal decision-making purposes

Intended User

City of Ocala

Property Rights Appraised

Fee simple interest

Appraisal Dates

Date of Inspection: September 8, 2022

Effective Date of Value: September 8, 2022

Date of Report: September 16, 2022

Identification of the Property

19,602 SF (.45 acres) of vacant land located at the northeast corner of the intersection of W. Silver Springs Boulevard (SR 40) and SW 19th Avenue in Ocala, Marion County, Florida

Site Data

Size: 19,602 SF; .45 AC

Zoning: RO, Residential-Office

Future Land Use: Neighborhood

Characteristics: L-shaped site; grassy characteristics with minimal to moderate tree cover; fairly level elevations with a gradual downward slope to the northeast; corner lot configuration with paved road frontage along W.

Silver Springs Boulevard (SR 40), SW 19th Avenue, and SW 1st Street; situated level with all three road grades

Flood Zone: Zones X and A (FEMA Panel Nos. 12083C 0516 E and 12083C 0517

E; dated April 19, 2017)

Improvements: Asphalt parking area (1,800 SF)

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Highest and Best Use

Commercial development

Approach to Value

Sales Comparison Approach $90,000 19,602 SF @ $4.50/SF, rounded

Market Value Estimate

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SCOPE OF WORK

All appraisals begin by identifying the appraisal problem. Data concerning the subject property is determined from various sources including, but not limited to, the property owner, various governmental agencies, surveys and building plans, and engineering studies/reports. When possible, more than one source is utilized to confirm data, and within the report the source is identified. Should plans or a building sketch be available, the measurements are confirmed for accuracy. Land size is based on surveys, public records, and/or recorded plats. Descriptions of improvements are based on visual inspection and/or plans. The age of the improvements is based on public records or discussions with knowledgeable parties.

For each assignment, all approaches to value are considered. These include the Cost Approach, Sales Comparison Approach, and Income Approach. However, depending on the property being appraised not all approaches are applicable. Comparable sales and rentals are inspected by the appraiser and the sale prices and lease information are confirmed with a party to the transaction (buyer, seller, real estate Broker, or closing attorney) or through public records. Research of comparable sales and rentals include, but are not limited to, data sources such as Multiple Listing Service, Marion County Property Appraiser, CoStar, Loopnet, local Brokers, Realtors, and property managers, as well as peers within the real estate appraisal profession.

The scope of work for this appraisal assignment includes physical inspection of the subject property and the surrounding influences of the region and neighborhood. The highest and best use of the subject property, as vacant, must then be determined acknowledging legal permissibility, physical possibility, financial feasibility, and maximum productivity. Next, the market must be researched for comparable land sales for comparison to the subject. As a result, the market identified for analysis purposes and ultimate conclusion of value herein included the current and competitive open market using vacant commercial land sales similarly influenced as the subject property. The data is then analyzed as it relates to the subject property and an estimate of market value of the fee simple interest is concluded, as of the effective date of valuation, from the range of value indicators. Finally, an appraisal report is prepared that summarizes the analyses and conclusions of the appraiser.

Because the subject property is comprised of vacant land, only the Sales Comparison Approach to value will be included in this report.

The value conclusion presented herein excludes the value of personal property including furnishings, fixtures, and equipment (F, F & E), as well as business inventory. As well, the valuation process excludes goodwill of the business, intangible, and/or going concern value. The conclusion of value is limited strictly to real estate; that is, land and any improvements that are identified within this report.

The scope of work for this assignment has been described above and is considered acceptable for this appraisal assignment. The analyses, opinions, and conclusions of this

C - 12 appraisal report have been prepared in accordance with accepted appraisal practices and procedures provided by USPAP, FIRREA, and the Appraisal Institute.

PURPOSE OF THE APPRAISAL

The purpose of this appraisal is to estimate the market value of the fee simple interest of the subject property identified herein, as of the effective date of valuation.

INTENDED USE OF APPRAISAL AND INTENDED USER

The intended use of this appraisal is to determine market value for internal decision-making purposes. The intended user of the appraisal is the City of Ocala. I have not provided any services regarding the subject property within the prior three years, as an appraiser or in any other capacity.

PROPERTY RIGHTS APPRAISED

The value conclusion presented herein acknowledges the fee simple interest of the subject property.

Fee Simple Interest

Fee simple interest is defined as absolute ownership unencumbered by any other interest or estate. A person who owns all of the property rights is said to have fee simple title, subject only to the limitations of eminent domain, escheat, police power, and taxation.

APPRAISAL DATES

The effective dates of this appraisal are as follows.

Date of Inspection: September 8, 2022 Effective Date of Value: September 8, 2022 Date of Report: September 16, 2022

DEFINITION OF VALUE

The following definition was compiled from the Code of Federal Regulations, Title 12, Chapter I, Part 34.42[g] and The Dictionary of Real Estate Appraisal, Sixth Edition, published by the Appraisal Institute.

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Market Value

Market value is defined as the most probable price that a property should bring in a 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 passing of title from seller to buyer under conditions whereby:

· buyer and seller are typically motivated;

· both parties are well informed or well advised, and acting in what they consider their best interests;

· a reasonable time is allowed for exposure in the open market;

· payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and,

· the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.

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IDENTIFICATION OF THE PROPERTY

The subject property is identified as approximately 19,602 SF, or .45 acres, of vacant land located at the northeast corner of the intersection of W. Silver Springs Boulevard (SR 40) and SW 19th Avenue in Ocala, Marion County, Florida. The property is further identified as Parcel Nos. 2260-110-023 and 2260-110-026 and includes additional frontage along SW 1st Street.

LEGAL DESCRIPTION

The complete legal description of the subject property is located in the Addenda of this report.

PROPERTY OWNERSHIP

As of the effective date of valuation, fee simple ownership of the subject property is identified as:

City of Ocala 1805 NE 30th Avenue, Building 700 Ocala, Florida 34470-4882

HISTORY OF THE PROPERTY

Sales History

The most recent acquisition of the subject property occurred on February 6, 2020, as recorded in OR Book 7134, Pages 1383-1385 of the public records of Marion County, Florida. Ownership was transferred via a Warranty Deed from Greater Ocala Community Development Corporation (grantor) to the owner of record (grantee) for a verified purchase price of $31,000. The sale price was below market occurrences. There have been no other transfers of ownership associated with the subject property in the prior three years.

Rental Data

No lease information was provided to the appraiser.

TAXES AND ASSESSMENTS

The subject property is included in the 2022 Marion County Property Assessment Roll as Parcel Nos. 2260-110-023 and 2260-110-026. The total assessed value in 2021 was

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$40,369. However, because the property is owned by a municipality, the total taxable value was $0 and the 2021 combined real estate taxes and assessments were $0. According to information provided by the Marion County Tax Collector, there are no past due taxes from previous years.

ZONING AND LAND USE PLANS

According to the City of Ocala Land Development Regulations and Comprehensive Plan, the subject property includes the following classifications.

Zoning

RO, Residential-Office

The Residential-Office (RO) district is intended primarily for professional and business office uses that are not incompatible with adjacent residential zones. This district allows one- and two-family dwellings and professional and business offices. Overnight parking of business vehicles is restricted to automobiles and trucks of ¾-ton or less.

Lot and building standards include a maximum building height of 35 feet. The minimum lot width is 100 feet and the minimum lot size is 12,500 SF. Minimum setback requirements are 25 feet for the front and street side yards, 10 feet for the interior side yard, and 25 feet for the rear yard. The maximum lot coverage by all buildings is 30%.

Future Land Use

According to the City of Ocala Comprehensive Plan, the subject property is located within the Neighborhood future land use classification. The intent of the Neighborhood category is to identify and reserve predominantly residential and ancillary uses. Existing street pattern, tree canopy cover, character, and residential occupancy will be considered when designating areas with the Neighborhood category. The form of buildings and development may be regulated by a Corridor Overlay. Residential is the primary use.

Single-family residential uses are allowed, based on the Land Development Code, up to the maximum density permitted by the Comprehensive Plan. Multi-family residential uses will be reviewed through the development process to determine compatibility, with specific approval criteria being further defined in the Land Development Code. There is no minimum density and intensity in this future land use category. However, the maximum density before any incentives is five dwelling units per gross acre for single-family residential uses and 12 dwelling units per gross acre for multi-family residential development. The maximum intensity, or floor area ratio (FAR), before any incentives for non-residential development is .25.

Based on the current zoning and future land use classifications, the conclusion of highest and best use for some form of commercial development is permissible.

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ZONING MAP

FUTURE LAND USE MAP

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SITE DESCRIPTION AND ANALYSIS

According to information provided by the Marion County Property Appraiser's Office, the subject property includes approximately 19,602 SF, or .45 acres. It is located at the northeast corner of the intersection of W. Silver Springs Boulevard (SR 40) and SW 19th Avenue with additional frontage along SW 1st Street. The L-shaped site includes grassy characteristics with minimal to moderate tree cover, fairly level elevations, and a gradual downward slope to the northeast. It has a corner lot configuration with paved road frontage along SR 40, SW 19th Avenue, and SW 1st Street. The property is situated level with all three road grades. An asphalt parking area (1,800 SF) is situated in the southeast portion of the site and provides minimal contributory value.

Adjacent uses include single-family residences and a duplex to the north, single-family residences to the south and east, and Compound Express Carwash to the west. SR 40 is a four-lane paved state highway with concrete, grassy, and landscaped median, center turn-lanes, concrete curbs and gutters, concrete sidewalks, overhead electric service, and streetlights. SW 19th Avenue and SW 1st Street are two-lane paved interior streets with overhead electric service, streetlights, and drainage swales. The property is accessible from the eastbound and westbound lanes of traffic via a median cut.

Based on information provided by the Florida Department of Transportation (FDOT), the annual average daily traffic (AADT) along SR 40 (NW 30th Avenue to W. Broadway Street) in 2021 was a total of 23,000 trips. Water, sewer, and electric services are provided to the subject site by the City of Ocala.

According to FEMA Flood Insurance Rate Map Panel Nos. 12083C 0516 E and 12083C 0517 E, dated April 19, 2017, the majority of the subject site is located in Zone X, an area determined to be outside the 0.2% annual flood plain. The northeast portion of the property is situated in Zone A, a special flood hazard area subject to flooding by the 1% annual chance flood in which the base flood elevation has not been determined.

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AERIAL MAP

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FLOOD INSURANCE RATE MAP

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MARKET ANALYSIS

As was previously discussed, the subject property is identified as approximately 19,602 SF, or .45 acres, of vacant land located at the northeast corner of the intersection of W.

Silver Springs Boulevard (SR 40) and SW 19th Avenue in Ocala, Marion County, Florida.

The property is further identified as Parcel Nos. 2260-110-023 and 2260-110-026 and includes additional frontage along SW 1st Street. Please refer to the Site Description and Analysis section of this report for descriptions of the subject site and any existing improvements.

Based on my comparison of the subject with other vacant sites in the market area that include commercial development potential, the physical characteristics are typical of similar properties. The L-shaped site includes grassy characteristics with minimal to moderate tree cover, fairly level elevations, and a gradual downward slope to the northeast.

It has a corner lot configuration with paved road frontage along SR 40, SW 19th Avenue, and SW 1st Street and is situated level with all three road grades. According to my analysis of other vacant commercial parcels, the physical characteristics of the subject property are typical of similar properties. As a result, this analysis indicates the subject is comparable to other vacant properties with commercial development potential.

As previously discussed in the Zoning and Land Use Plans section of this report, the subject is zoned RO, Residential-Office with a Neighborhood future land use classification. A review of the City of Ocala Future Land Use Maps shows the subject's location in relationship with surrounding land uses. The zoning and future land use patterns are consistent with planning policies, and adjacent land uses in the area are complementary.

Please refer to the Zoning and Land Use Plans section for more detailed discussion of the public regulations governing the subject property.

The general neighborhood that has the greatest impact upon the highest and best use of the subject is identified as the land area located along the SR 40 corridor between US Highway 27/301/441 (Pine Avenue) and I-75. The subject neighborhood extends about three miles with a variety of uses including commercial, industrial, residential, and governmental. SR 40 is a four-lane paved state highway that provides the major east/west access in the neighborhood. It extends west to US Highway 41 in west Marion County and east to its terminus at A1A in Volusia County. Other major four- and six-lane thoroughfares in the neighborhood include NW 10th Street (US Highway 27), Pine Avenue, SW 17th Street (SR 464), SW College Road (SR 200), W. Martin Luther King, Jr. Boulevard, and W. 27th Avenue. The neighborhood also includes a network of two-lane paved City streets that service the residential sector.

According to information provided by CoStar, the 2022 population estimate within three miles of the subject property was 39,380 persons, which represents a 10.60% increase over 2010 levels. This is expected to increase to 43,720 persons in 2027. The average household size is 2.30 persons and 43.67% of the homes are owner-occupied. The median age within a three-mile radius of the subject is 38.90 years and the unemployment rate of 3.43% is between the Ocala/Marion County and State averages of 3.5% and 2.7%, C - 21 respectively (United States Department of Labor, Bureau of Labor Statistics, July 2022).

The average household income in the area is $54,235, while the median household income is $37,532. The median home value within three miles of the subject property is $134,130 and the median year built is 1981. Lastly, a majority of the homes in the immediate area (41.06%) are valued under $100,000, while 26.20% of the homes are valued between $100,000 and $200,000.

Commercial uses in the subject neighborhood are generally situated along SR 40, US Highway 27, Pine Avenue, and SR 200. The properties include restaurants, auto sales and service centers, office buildings, retail properties, and convenience stores with fuel sales.

The commercial properties fronting SR 40 were noted as Donavon's Unisex Beauty Salon, Lookin' Good Beauty Supply, Quick Fix Phone Repair, Metro by T-Mobile, Chese Cleaners, All Stars Learning Center, Quality Discount Meats, Big Apple, Kwik Stop, Sunoco, Wawa, RaceTrac, Circle K-Mobil, Amoco, Advanced Discount Auto Parts, Family Dollar, Dollar General, Mattress Warehouse, Bargain Barn, Goodwill Outlet, Tom Atside's Restaurant Equipment & Sales, Zaxby's, Waffle House, McDonald's, Taco Bell, Popeye's, Wendy's, K & S Seafood, Economy Inn, and Studio 6 Extended Stay. Other commercial uses in the area were noted along US Highway 27, Pine Avenue, and SR 200, which continues to lead Ocala in terms of expansion of retail services.

The subject neighborhood is also heavily influenced by industrial uses due primarily to the proximity of the I-75 interchanges at SR 40 and US Highway 27. In addition to favorable distribution routes available to the subject neighborhood, other amenities include rail access, a full complement of City utilities, and the Ocala International Airport. Local officials with the Ocala-Marion County Transportation Planning Organization are currently discussing massive overhauls at two I-75 interchanges (SR 40 and US Highway 27). The purpose would be to increase the flow of vehicles on and off the interstate by adding new turn-lanes, extending existing turn-lanes, and periodically resetting the timing of traffic signals.

Ocala's best known and most historically successful industrial park (Ocala Industrial Park) is located between US Highway 27/301/441 and SR 200. The Ocala Industrial Park was developed in the 1960's and was a re-plat of the Jim Taylor Airport, which was the only airport facility in Ocala at that time. When the Ocala Industrial Park was developed, the subject neighborhood was considered rural and removed from the commercial and residential districts of Ocala and represented a good location for industrial development.

The interior of the Ocala Industrial Park is almost exclusively improved with industrial facilities, which demonstrates the historical popularity of the park for industrial use.

The other industrial parks east of I-75 are generally situated along and just removed from the road frontage of NW 27th Avenue. These subdivisions include Shady Road Industrial Park, Going's Corner, Galloway and Sands Industrial Subdivision, Bryan's (Bison) Industrial Park, Central Park, and South Forty Industrial Park. This area includes the Hale Products-Class 1, Outlaw Snax, Cheney Brothers, and Raney's Truck Parts manufacturing and distribution facilities.

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A site commonly known as the Magna property is located in the northeast quadrant of the I-75/US Highway 27 interchange. City and County officials believe the Magna property could add more than 9,000 new jobs to the community over the next two decades. It includes about 490 acres owned by Ocala 489, LLC that fronts northbound I-75 at US Highway 27 and another 244 surrounding acres that could be consolidated for a mixed-use commerce park. The project included the widening of NW 35th Street to four lanes and the extension of a road from the junction of NW 27th Avenue and NW 35th Street west and south to US Highway 27 just east of I-75. It will eventually connect to a proposed interchange at NW 49th Street that will include the extension of NW 49th Street from NW 44th Avenue to NW 35th Avenue. The design is currently underway and the findings and recommendations of the PD&E study will be refined and updated during the design process. The development includes the 383,161 SF FedEx Ground package distribution hub, a 444,000 SF AutoZone distribution hub that serves 290 stores throughout Florida and Puerto Rico, a 600,000 SF distribution facility for Chewy.com, and the 617,046 SF Florida Crossroads Logistics Center (Amazon). A 23-acre parcel was recently acquired by Peak Development and is proposed for development with a 400,000 SF warehouse.

As previously stated, the residential properties (both single- and multi-family uses) are located to the north and south of SR 40. As well, the governmental facilities in the area include Howard Middle School, Madison Street Elementary School, Dr. N. H. Jones Elementary School, and the Marion County Jail. Other governmental properties in the neighborhood include the State of Florida Department of Transportation facility and the State of Florida Department of Juvenile Justice Detention Center.

Marketing activity in the neighborhood has historically been limited due largely to the focus of development along the SR 200 corridor (about one mile south of SR 40), which has been extremely popular for many years. The exception has been the aforementioned recent development near the I-75 interchanges. This includes Wawa, RaceTrac, Popeye's, Waffle House, and RaceWash Express (under construction) along SR 40, as well as Rural King, 7-Eleven, Circle K, and RaceTrac along US Highway 27. UF Health has plans for a neighborhood hospital with emergency department services proximate to the I-75/US Highway 27interchange. Although the neighborhood includes the necessary infrastructure, as well as excellent accessibility, this trend of limited development is expected to continue.

Based on my studies, the demand for commercial and industrial space has not out-paced the current supply. As a result, the average vacancy rate for the subject neighborhood remains between 5% and 10%. However, as vacancy rates have remained fairly steady, rental rates in the area have gradually increased. This information is supported by discussions with local Brokers, Realtors, and property managers who indicated sale prices and rental rates have continued to increase in this portion of Ocala/Marion County. The market participants interviewed also indicated vacant properties generally spend no more than six months on the market if they are listed at market levels. This is supported by the three most recent land sales studied (Land Sales 3-5) that sold after between 20 and 152 days on the market. Although end-users represent the majority of buyers, there have also been a number of purchases for investment purposes and there seems to be investors searching for attractive opportunities. The limited number of available properties has

C - 23 resulted in higher land prices and increased values and shorter marketing periods for existing properties. Furthermore, as sale prices and rental rates for improved properties increase and vacancy levels remain low, the costs to acquire land and develop are likely to become feasible and construction in the near future is expected to increase.

That being said, the United States of America continues to recover from a national health pandemic caused by COVID-19 (coronavirus). In the short-term, financial markets and the global economy have experienced significant volatility and turmoil. The Federal Reserve responded to the pandemic with significant reductions to interest rates in an effort to offset market uncertainty. Although the full impact to the real estate market is not yet fully understood, currently, there appears to be continued demand for mortgage refinancing due to historically low interest rates that may be a short-term phenomenon. In an effort to avoid face-to-face contact, banks initially reduced access to their lobbies. However, these policies have been relaxed and increased transaction volumes have been the result.

With respect to Florida, the number of new cases peaked in July 2020 and then decreased throughout August 2020 to the middle of October 2020. The number of cases peaked again in January 2021 and most recently in mid-August 2021. With the emergence of the Omicron variant in early December 2021 and the BA.5 subvariant in July 2022, cases trended upward significantly, while the number of deaths has remained low. As of the effective date of valuation, there was a seven-day average of 4,121 new cases per day in Florida. Although occasional spikes are anticipated, there is optimism any current market disruptions could be short-term. Vaccines have largely been delivered to healthcare personnel and long-term care facility residents and are widely available to the general public. My analysis relies on the best available market data and the overall assumption is the market will continue to stabilize and revert to prior conditions as the public health risk is contained.

In conclusion, the location of the subject along W. Silver Springs Boulevard (SR 40) is appropriate for a mixture of commercial and light industrial properties. Land uses in the subject neighborhood have historically been defined as the aforementioned property types along the major thoroughfares with residential uses to the north and south of SR 40. As a result, commercial and light industrial concerns within the neighborhood are supported by the large residential base of west Ocala. Although this area has proven to be successful with these types of properties, there has been limited development along the corridor with the exception of properties proximate to the I-75 interchange, Pine Avenue, and SR 200.

However, the area provides a good location for additional commercial and light industrial properties with ample infrastructure and a large residential base that provide the foundation for development.

HIGHEST AND BEST USE ANALYSIS

The basis of an appropriate conclusion of final value is the identification of the most profitable and competitive use to which a property can be put. This is accomplished through an analysis of the property's highest and best use.

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The Appraisal of Real Estate, Fourteenth Edition, published by the Appraisal Institute, defines highest and best use as:

The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum productivity.

Highest and best use analysis is a three-step process. The first step involves the highest and best use of a site as though vacant. The determination must be made to leave the site vacant or to improve it. If the conclusion is to improve the site, the second step is to determine the ideal improvement. The final step is a comparison between the ideal improvement and the existing improvement. At this point, the determination must be made to maintain the property in its present form or to modify the improvements to conform more closely with the ideal.

AS VACANT

Acknowledging the existing zoning (RO, Residential-Office) and future land use (Neighborhood) designations, development of the subject site is intended for professional and business office uses that are not incompatible with adjacent residential zones. This district allows one- and two-family dwellings and professional and business offices. Due to the smaller size of the site, some form of commercial use that caters to the residential base and benefits from the frontage along a well-travelled commercial corridor is legally permissible and physically possible. Based on my physical inspection of the immediate neighborhood, the area is largely comprised of these property types and the financial feasibility for development in the form of a commercial use is well stated. Such a use should also result in maximum productivity for the site with ample size for a building and required site improvements and greenspace. Therefore, use of the subject for commercial development purposes represents the highest and best use of the subject site, as vacant.

PROCESS OF ANALYSIS AND VALUATION

Traditionally, there are three approaches utilized in the valuation of real property. These include the Cost Approach, Sales Comparison Approach, and Income Capitalization Approach.

The Cost Approach is based on the principle of substitution, which states that no rational person would pay more for a property than the amount for which he can obtain, by purchase of a site and construction of improvements, without undue delay, a property of equal desirability and utility. The basic steps of the Cost Approach are to estimate site value, as vacant, estimate the reproduction cost new of the basic improvements and minor structures (excluding any that were included as part of the site value), and then estimate, in dollar amounts, the accrued depreciation caused by the physical deterioration, functional deficiencies or superadequacies, or any adverse external influences. The next step is to

C - 25 deduct the accrued depreciation from the improvement's estimated reproduction cost new to arrive at a present depreciated cost estimate. Then, by adding the site value estimate, the result is to arrive at an indicated value for the property via the Cost Approach.

The Sales Comparison Approach is based on the principal of substitution, which indicates that an informed purchaser would pay no more for a property than the cost of acquiring an equally desirable substitute property with the same or similar utility. This approach is applicable when an active market provides sufficient quantities of reliable data that can be verified from authoritative sources. The Sales Comparison Approach is reliable in an active market or if an estimate of value is related to properties for which there are comparable sales available. This approach to value is also pertinent when sales data can be verified with the principals to the transaction. Heavy emphasis is placed on this approach to value in an active market.

In the Income Capitalization Approach, we are concerned with the present value of any future benefits of property ownership. Future benefits are generally indicated by the amount of net income the property will produce during its remaining useful life. After comparison of interest yields and characteristics of risk for investments of similar type and class of properties, this net income is then capitalized into an estimate of value. The value indicated by the Income Capitalization Approach is generally the most indicative value indication for properties that are held for income production or for investment purposes.

After obtaining value estimates by the Cost, Sales Comparison, and Income Capitalization Approaches, the results are reconciled into a final value conclusion. This reconciliation process is a weighing of the strengths and weaknesses of each approach in order to reconcile the independent valuation estimates into a single, comprehensive estimate of market value.

For purposes of this appraisal report, only the Sales Comparison Approach to value will be included herein.

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SALES COMPARISON APPROACH

The Sales Comparison Approach of this appraisal will compare sales of similarly influenced properties with the subject. The reliability of this approach rests in the validity of the sales presented in terms of sale price, location, date of sale, physical characteristics, and so forth. This is accomplished by the verification process in which parties to the transactions are interviewed to verify information concerning the sales.

This approach is based on the Principle of Substitution, which holds that buyers and sellers go through a process similar to the comparison process herein when selecting a property based upon personal preferences, tastes, opinions and desires. Adjustments are made to the sales when differences are found after comparison to the subject.

The procedures of the Sales Comparison Approach include the investigation of the market for comparable sales based upon the best verification available. These sales are then compared to the subject and adjustments are applied (as needed) to account for differences noted. Examination and analysis of the sales and the resulting adjusted sale prices provide the best reflection of value for the subject property via the Sales Comparison Approach.

Due to the conclusion of highest and best use, as vacant, sales of vacant commercial properties located along commercial corridors in west Ocala are compared to the subject resulting in an appropriate conclusion of value for the subject site. As a result of the current zoning and future land use classifications for the subject, the land sales studied herein represent properties with commercial development potential.

Because no two properties are identical, adjustments are applied as an equalizer to account for differences between the sales and the subject. In lieu of specific adjustments, the bracketing process will be employed. This process "brackets" the subject between the sales with superior (-) and inferior (+) characteristics with the indication of value for the subject emphasizing those sales with similar features. This will be demonstrated in the following analysis, which is presented in a table format.

The land sales presented in the following table are located in the subject's market area and other areas of similar economic influence. As a result, the sales studied are considered to be the most comparable to the subject and will be used to provide the estimate of market value for the subject property via the Sales Comparison Approach, as of the effective date of valuation.

Based on market evidence, land sales with commercial development potential are most commonly valued on a price per square foot basis. All of the comparable land sales have been inspected and analyzed on the basis of conditions of sale, market conditions (time), location, size, physical characteristics, road frontage (access), and development density (zoning). These adjustments will be applied to the land sales presented in the following table. The comparable land sales location map and presentation of the land sales will follow the table.

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COMPARABLE LAND SALES

Subject: 19,602 SF

Land Sale

Sale Date

Size

(SF)

C of S

Time

Loc.

Size

Phys.

Char.

Access

Zoning

Adj. Sale Price/SF

1 05/21 21,780 = + = = + = - >$3.90

2 09/21 7,841 = = = - = = = <$7.01

3 10/21 32,669 = = = + = = - <$10.25

4 02/22 12,632 = = = = = + - >$2.57

5 04/22 91,040 = = = + = + - >$1.92

LAND SALES LOCATION MAP

Range: $1.92/SF to $10.25/SF Mean: $5.13/SF Median: $3.90/SF

LAND SALE 5

LAND SALE 4

LAND SALE 1

LAND SALE 3

LAND SALE 2

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COUNTY: Marion

RECORDING: 7466/1709

LOCATION: Northwest corner of the junction of NW 10th Street (US

Highway 27) and NW 24th Avenue, Ocala

SALE DATE: 05/14/2021

SALE PRICE: $85,000 $3.90/SF

FINANCING: Seller ($65,000)

PROPERTY RIGHTS: Fee simple

CONDITIONS OF SALE: Arm's length

GRANTOR: Dhaka Properties, LLC

GRANTEE: Jahmerican Bakery, LLC

LEGAL DESCRIPTION: Lengthy legal lying in Section 12-15-21; Marion County, Florida

HIGHEST & BEST USE: Commercial development

SITE SIZE: 21,780 SF; .50 AC

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SITE DESCRIPTION: Triangular-shaped site; grassy characteristics with no trees;

fairly level elevations; corner lot configuration with paved road frontage along NW 10th Street (US Highway 27), NW 24th Avenue, and NW Old Blitchton Road; situated level with all three road grades; according to the FDOT, the AADT along US Highway 27 (NW 27th Avenue to Martin Luther King, Jr. Boulevard) in 2020 was a total of 22,500 trips

ZONING: B-5, Wholesale Business

FUTURE LAND USE: Employment Center

FLOOD ZONE: Zone X (FEMA Panel No. 12083C 0508 E; 04/19/2017)

IMPROVEMENTS: The property includes asphalt and concrete paving in the west portion of the site that provided minimal, if any, contributory value

ANALYSIS: The property was listed for $85,000 prior to the sale and sold after 606 days on the market; based on a study of other commercial land sales in the market, the purchase price was aligned with market occurrences

VERIFIED WITH: Lance Schenker, Realtor (Bill Rodgers Realty); 08/05/2021

VERIFIED BY: Nathan R. Gibboney, MAI

PARCEL NO: 22172-000-00

C - 30

RECORDING: 7566/1393

LOCATION: Northwest corner of the intersection of W. Silver Springs

Boulevard (SR 40) and SW 24th Avenue, Ocala

SALE DATE: 09/09/2021

SALE PRICE: $55,000 $7.01/SF

FINANCING: Seller ($38,500)

GRANTOR: GTG (Glory to God), Inc.

GRANTEE: Raymond Luis Correa Ayala

LEGAL DESCRIPTION: Lots 2 and 4, Block 210, West End Ocala; Section 13-15-21;

Marion County, Florida

SITE SIZE: 7,841 SF; .18 AC

C - 31

SITE DESCRIPTION: Rectangular site; grassy characteristics with minimal tree cover; highest elevations to the east with a gradual downward slope to the southwest; corner lot configuration with paved road frontage along W. Silver Springs Boulevard (SR 40) and SW 24th Avenue; situated level with both road grades; according to the FDOT, the AADT along SR 40 (NW 30th Avenue to W. Broadway Street) in 2020 was a total of 23,000 trips

ZONING: RO, Residential-Office

FUTURE LAND USE: Low Intensity

FLOOD ZONE: Zone X (FEMA Panel No. 12083C 0516 E; 04/19/2017)

IMPROVEMENTS: None

ANALYSIS: The property was listed for $55,000 prior to the sale and sold after 1,354 days on the market; the verifying party indicated the buyer plans to develop the property and will be the end-user; based on a study of other commercial land sales in the market, the purchase price was aligned with market occurrences

VERIFIED WITH: Lorenzo Ramunno, Realtor (Busch Realty); 08/15/2022

PARCEL NO: 2260-210-002

C - 32

RECORDING: 7607/1349

LOCATION: Southwest corner of the intersection of W. Silver Springs

Boulevard (SR 40) and SW Martin Luther King, Jr. Avenue, Ocala

SALE DATE: 10/19/2021

SALE PRICE: $335,000 $10.25/SF

FINANCING: Seller ($167,500)

GRANTOR: Aladin Suleiman

GRANTEE: Rock Hospitality Partners 22, LLC

LEGAL DESCRIPTION: Lots 1-9, Block 91, Rheinauer's Addition to Marti City;

Section 13-15-21; Marion County, Florida

SITE SIZE: 32,669 SF; .75 AC

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SITE DESCRIPTION: L-shaped site; grassy characteristics with few trees; highest elevations to the east with a gradual downward slope to the northwest; corner lot configuration with paved road frontage along W. Silver Springs Boulevard (SR 40), SW Martin Luther King, Jr. Avenue, and SW Fort King Street; situated level with all three road grades; according to the FDOT, the AADT along SR 40 (NW 30th Avenue to W. Broadway Street) in 2020 was a total of 23,000 trips, while the AADT along SW Martin Luther King, Jr. Avenue (SR 200 and SR

40) in 2020 was a total of 11,300 trips

ZONING: B-2, Community Business (Parcel No. 22528-000-00) B-1, Neighborhood Business (22529-000-00 and 22530- 000-00) R-2, Two-Family Residential (22529-001-00 and 22531- 000-00)

FUTURE LAND USE: Medium Intensity/Special District

FLOOD ZONE: Zone X (FEMA Panel No. 12083C 0517 E; 04/19/2017)

ANALYSIS: The property was listed for $369,000 prior to the sale and sold after 152 days on the market; the buyer subsequently acquired additional parcels to the west and intends to develop a portion of the total site with a dine-in restaurant;

based on a study of other commercial land sales in the market, the purchase price was aligned with market occurrences

VERIFIED WITH: Chris Healy, Realtor (Glen Miller Realty); 08/15/2022

PARCEL NO: 22528-000-00; 22529-000-00; 22529-001-00; 22530-000-

00; 22531-000-00

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RECORDING: 7695/1279

LOCATION: North side of W. Silver Springs Boulevard (SR 40) between

SW 24th Avenue and SW 26th Avenue, Ocala

SALE DATE: 02/07/2022

SALE PRICE: $32,500 $2.57/SF

FINANCING: Cash to seller

GRANTOR: The Estate of Gwendolyn B. Sims

GRANTEE: Kimball & Chazel James

LEGAL DESCRIPTION: Lengthy legal lying in Section 13-15-21; Marion County, Florida

SITE SIZE: 12,632 SF; .29 AC

C - 35

SITE DESCRIPTION: Rectangular site; grassy characteristics with moderate tree cover; fairly level elevations; interior lot configuration with paved road frontage along W. Silver Springs Boulevard (SR 40); situated level with road grade; according to the FDOT, the AADT along SR 40 (NW 30th Avenue to W. Broadway Street) in 2021 was a total of 23,000 trips

ZONING: B-4, General Business

FLOOD ZONE: Zone X (FEMA Panel No. 12083C 0516 E; 04/19/2017)

ANALYSIS: The property was listed for $35,000 prior to the sale and sold after 151 days on the market; based on a study of other aligned with market occurrences

VERIFIED WITH: Nicholas Josey, Realtor (Homerun Realty); 08/15/2022

PARCEL NO: 22705-001-00

C - 36

RECORDING: 7755/1707

LOCATION: South side of NW 10th Street (US Highway 27) just west of

NW Martin Luther King, Jr. Avenue, Ocala

SALE DATE: 04/15/2022

SALE PRICE: $175,000 $1.92/SF

FINANCING: Cash to seller

GRANTOR: Betty Jean Conchiglio, Trustee

GRANTEE: Jason Lyons

LEGAL DESCRIPTION: Lengthy legal lying in the West ½ of Lot 9, Agnew's Subdivision; Section 12-15-22; Marion County, Florida

SITE SIZE: 91,040 SF; 2.09 AC

C - 37

SITE DESCRIPTION: Rectangular site; grassy characteristics with few trees;

highest elevations to the north with a gradual downward slope to the southeast; interior lot configuration with paved road frontage along US Highway 27 and NW 8th Place;

situated level with both road grades; according to the FDOT, the AADT along US Highway 27 (NW 27th Avenue to NW Martin Luther King, Jr. Avenue) in 2021 was a total of 23,500 trips

ZONING: B-4, General Business

FLOOD ZONE: Zone X (FEMA Panel No. 12083C 0509 E; 04/19/2017)

IMPROVEMENTS: The property includes chainlink perimeter fencing that provided minimal contributory value

ANALYSIS: The property was listed for $250,000 prior to the sale and sold after 20 days on the market; the verifying party indicated, although the sale was not distressed, the asking price was below market occurrences and the seller accepted the first offer submitted; the buyer purchased the property for speculative investment purposes and it is currently listed for sale at $400,000, or $4.39/SF; based on a study of other somewhat below market occurrences

VERIFIED WITH: David Williams, Realtor (Showcase Properties of Central Florida); 08/15/2022

PARCEL NO: 22293-000-00

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Conclusion

The land sales presented herein include an appropriate sale price range for conclusion of value for the subject site. These five sales provided a range from $1.92/SF to $10.25/SF with a statistical mean of $5.13/SF and a statistical median of $3.90/SF. Based on the bracketing process as noted in the comparable land sales table, an indication of value above $3.90/SF (highest indicator of Land Sales 1, 4, and 5) and below $7.01/SF (lowest indicator of Land Sales 2 and 3) is appropriate for the subject.

In addition, I have studied two listings of vacant commercial properties in the neighborhood that provided an asking price range from $3.33/SF to $5.57/SF with an average asking price of $4.45/SF. It should be noted these properties ranged in size from 14,375 SF to 21,033 SF. Additionally, the average time on market has been almost 12 months, which may suggest asking prices above market occurrences. That being said, a conclusion near the average asking price is made.

Therefore, due to the smaller size of the subject site (economies of scale) and corner lot configuration, which is somewhat offset by the inferior zoning classification that limits the intensity of commercial development, a conclusion between the statistical indicators is made. As a result, I have concluded the market value estimate of the fee simple interest of the subject property, as of September 8, 2022, at $4.50/SF, or $90,000.

MARKETING AND EXPOSURE TIME

According to discussions with area Brokers and real estate agents, properties similar to the…