ANT BITE -- The BMC HypoAppraisal

The long awaited BMC "appraisal"—sort of---has been released by the City. Initially, upon reading the newspapers last week,Aspenites were comforted by the assurance that the value was only $1.45 million less than the $16.8 million paid in December, 2007. But upon further examination of the appraisal, and discussions with real estate professionals, the City is once again being challenged with the outrageous spin they put on the so called, “appraisal.” (Reminds us of the bogus press releases issued after the Burlingame audits.)

Turns out the “appraisal” was a very nonstandard valuation based on “Extraordinary Assumptions” and “Hypothetical conditions”---not what a reasonable buyer would pay!! And one any bank would laugh you out of the room for presenting.

John McBride, one of the most respected developers and businessmen in the valley, who knows this property like the back of his hand, called the public’s attention to the bogus appraisal in a guest column this week. (His columnis both linked and printed in full below.) And from there, the rocks are being uncovered.

We are not ready to write the Ant article on the issue yet, but given the attention it is getting and the blog entries we have received, we want to make as much information publicly available as possible.

Here’s a link to the Aspen Times article:

http://www.aspentimes.com/article/20090313/NEWS/903139970&parentprofile=search

And the City’s Press Release:

http://www.aspenpitkin.com/apps/news/news_item_detail.cfm?NewsItemID=1042

John McBride’s Column “Fantasy Economics” : (also reprinted in the comments below)

http://www.aspendailynews.com/section/columnist/133284

Mick Ireland’s Rebuttal to McBride:

http://www.aspendailynews.com/section/letter-editor/133319

A copy of the “appraisal”: (large file takes VERY LONG TIME to open):

http://www.aspenvotes.org/storage/HypoAppraisal.pdf

Fair Warning At the Time of Purchase:

http://www.aspentimes.com/article/20071129/NEWS/71128041&parentprofile=search

City Documents at Time of Council approval. (Explanation of $450,000+ per unit subisdy!)

http://www.aspenpitkin.com/pdfs/depts/38/cc.res.097-07.pdf 

See the comments below posted initially under issue #28 of The Red Ant “Land Banking Needs a Bailout.” We stand by our conclusions!

Stay tuned.We know that there is much more to learn. The Ant has been asking for a copy of the appaisal every few weeks since late summer, and the City always had some excuse as to why it was not complete. But the long awaitedreport was even more creative than we could have imagined!

Feel free to leave a comment below.

Comments

[Elizabeth]

In both Scott’s and Mick’s reply they keep reminding us that the City paid WAY more than FAIR MARKET VALUE for the property at the time of the purchase, --which is John McBride’s point. Most would agree that :
-it could be a good place for more affordable housing (if our fund balance ever recovers from the damaging blows dealt by this Council.)
-And that the government has the power to make the property more valuable in ways that it would not likely do for other buyers.
-And that it may SOMEDAY be very valuable as such a property, if developed according to the hypothetical assumptions.
.
However, the debate is whether the City paid far more than a willing 3rd party buyer would pay for the same property. It sounds to me that everyone----the appraiser, McBride, Mick and Scott are all in agreement that yes, in fact, the City paid far more than the property was worth in December, 2007.