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Attachment 1 <br />File:Scope of Work <br />INTEREST APPRAISED <br />Regarding the subject items that have the physical characteristicsof real estate, the <br />interest being appraised is the leaseholdinterest, or the leaseholdestate. The term <br />leasehold is defined below: <br />LeaseholdEstate – The rightheld by the lessee to use and occupyreal <br />4 <br />estate fora stated term and under conditions specified in the lease. <br />Again, the subject property is appraised under the extraordinary assumption that the <br />5 <br />tenant, TDM Salons LLC, would have continued to occupy the space at 2727 <br />Lexington Avenue North, Roseville, MN until the subject tenant improvements and <br />trade fixtures reached the ends of their useful lives. <br />METHODOLOGY <br />All three of the traditional approach to value were considered. However, the individual <br />items are appraised as they are currently installed/attached to the underlying land <br />and building. Thus, any comparable salesor rental data would, in all likelihood, also <br />include the underlying land and building improvements. Therefore, the cost approach <br />is the most pertinent and reliable indicator of fair market value when appraising the <br />subject tenant improvements and trade fixtures. <br />The methodology used in developing the cost approach is explained in a latter section <br />of this report. <br />4 <br />th <br />Appraisal Institute, The Dictionary of Real Estate Appraisal, 7ed. (Chicago: Appraisal <br />Institute, 2022), Page 105. <br />5 <br /> Known as Salon 27 at the 2727 Lexington Avenue North address. <br />Dodd Advisory & Valuation 6 <br />Qbhf!216!pg!385 <br /> <br />