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- - --- -,--- - -- ------------- DAHLEN & DWYER, INC. EXPLANATION OF ADJUSTMENTS The subject site is a rectangular shaped parcel containing a total of 13/510 SF. Zoning is R 1 or Single Family. The parcel is guided in the If Comprehensive Plan" as HR or High Density Residential. The definition of market value as stated in this report reflects cash or cash equivalent financing. All of the comparable sales involved cash terms and therefore required no adjustment for financing. An analysis of the multi-family residential land market in the immediate and general areas of the subject indicates depreciation of 4% in 1992 after which time, in 1993 and 1994 the market began to stabilize with no appreciation/depreciation. From 1995 through 1997 there was average annual appreciation of 5% and in 1998 and 1999 appreciation has been estimated at 7.5% annually. Appreciation year-to- date in 2000 has been 30/0. The economy in the St. Paul/Minneapolis Metropolitan Area is very strong with more lenders entering the marketplace and a strong demand for new development in several market sectors. Adjustments for location are based on the appraiser's judgement after considering such factors as access, visibility, traffic counts, proximity to freewaysl proximity to amenitiesl etc. Adjustments for size have been made on the basis that a smaller parcel will sell for a higher value/SF than a larger parcel. Adjustments for utility are made on the basis that a parcel which is very irregular in shape .or is long and narrow has below average functional utility and less demand in the marketplace than a parcel which is more rectangular in shape. All of the properties analyzed had either similar topographies or similar corrected topographies to that of. the subject. All parcels were mostly level and open. All utilities were readily available to the comparable sales as they are to the subject. 35