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Definitions <br /> <br />Market Value <br />The most probable price which a property should bring in a competitive and open market under all <br />conditions requisite to a fair sale, the buyer and seller, each acting prudently and knowledgeably and <br />assuming the price is not affected by undue stimulus, hnplicit in this definition is the consummation <br />of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: <br /> <br /> a. Buyer and seller are typically motivated; <br /> b. Both parties are well informed or well advised, and acting in what they consider their own <br /> best interests; <br /> c. A reasonable time is allowed for exposure in the open market; <br /> d. Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements <br /> comparable thereto; and <br /> e. The price represents the normal consideration for the property sold unaffected by special or <br /> creative financing or sales concessions granted by anyone associated with the sale. 1 <br /> <br />Fee Simple <br />An absolute fee; a fee without limitations to any particular class of heirs or restrictions, but subject <br />to the limitations of eminent domain, escheat; police power, and taxation. An inheritable estate. 2 <br /> <br />Leased Fee <br />An ownership interest held by a landlord with the right of use and occupancy conveyed by lease to <br />others; usually consists of the right to receive rent and the right of repossession at the termination <br />of the lease. 3 <br /> <br />Going Concern Value <br />The value created by a proven property operation; considered as a separate entity to be valued with <br />a specific business establishment. 4 <br /> <br />Business Value <br />A value enhancement that results from items of intangible personal property such as marketing, and <br />management skill, an assembled workforce, working capitol, trade names, franchises, patents, <br />trademarks, contracts, leases, and operating agreements. 5 <br /> <br />1 Department of Treasury, Office of the Comptroller of the Currency, 12 CFR Part 34.42. <br />2 American Institute of Real Estate Appraisers, 1st ed. The Dictionary of Real Estate Appraisal <br />Chicago, Illinois: AIREA, 1984) p. 123. <br />3 Ibid, p. 179 <br />4 Ibid, p. 160 <br />5 Ibid, p. 44 <br /> <br /> PAT MURPHY & ASSOCIATES 6 <br /> <br /> <br />