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South Bend Redevelopment Commission Regular Meeting —June 26, 2014 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (3) continued... were Hughes & Company and Valbridge Property Advisers, both well known, national golf course appraisal companies. The appraisals have been received, and as an update, the values arrived at are: V albridge - $1,560,000 Hughes- $1,750,000 Therefore, the fair market value as determined by averaging the two appraisals, is $1,655,000. The Department of Community Investment will continue to weigh options for the course, and will report back to the Commission when options arise. Mr. Varner asked whether these evaluations represent fee simple ownership. Mr. Relos responded that they do. Mr. Varner asked whether the appraisals break out what portion of the value is for land and what for the business. Mr. Zeeb responded that they both valued the course multiple ways. The highest and best use is still is a golf course. The values are inclusive of capital investment that you need too make in a golf course. Mr. Varner asked whether the valuations consider the fact that food services are constrained. Mr. Zeeb responded that the appraisers were informed of that. Mr. Downes said he had read the appraisals and noted that they valued the revenue stream. Then they used (eight or nine) comparable sales in the region that had sold in the last two years. He found it interesting that both appraisals said that the cost approach (the cost to build the course) would not be valid. He asked if anyone remembered what it had cost to construct Blackthorn Golf Course, because it was a unique property in that it required a lot less earth movement than most courses. Mr. Varner thought it was about $3.5M. Mr. Downes said that was very inexpensive at the time. However, this valuation is reflective of the declining golf market and the overbuilding of golf courses. Mr. Downes said it was hard for him to believe that the golf course isn't worth more money. Mr. Downes asked what the next step is. Mr. Relos replied that staff will try to consider options and determine a strategy for the golf course. (4) Resolution No. 3217 approving and authorizing the execution of an Addendum to the Master Agency Agreement (Ignition Park Multi - Tenant Campus)