Category: Advertising Billboard

Tennis and Racquet Sport Clubs

It all started in England in 1873.  That was the year lawn tennis was introduced by Major Walter Clopton Wingfield.  In fact, the game of tennis may be traced back to the days of ancient Greeks.  Tennis was brought to the United States and organized in 1881.  In recent decades, the bulging demand and the construction of thousands of tennis courts from public agencies, private clubs, resort operations, and residential developments have occurred.   The different types of tennis courts are outdoor clubs, indoor clubs, indoor/outdoor clubs, resorts, residential tennis facilities, in addition to racquetball, squash, paddle tennis, and platform tennis. 

Before the appraisal is undertaken of a new facility, the appraiser must do some careful research.  Breakeven points are rising as expenses increase the sale.  The measurement of demand is traditionally made in terms of players per tennis court.  For instance, for an appraisal that reports a level of approximately 120 players per court, the figure is based on the total number of existing future tennis players in the area and the total number of courts currently available within an area defined by a 15-minute driving time.  Other appraisers estimate the potential number of players in an area by computing a percent of the number of persons and families with incomes of a certain level.  There does not appear to be any loyalty to clubs, so convenience is an important factor.  The final component of the tennis facility market analysis is a survey of existing competitive tennis facilities and plans for proposed tennis courts serving a particular area.  The appraiser must perform independent research to determine the level of demand in any specific location and the supply of facilities representing the demand. 

Part of the site consideration includes location, size, shape, access, and zoning.  Some of the physical characteristics of a facility that must be considered include design, building type, tennis court layout, tennis court construction, lighting, heating and ventilation, and special equipment. 

Financing of a tennis club has been one of the major impediments to construction of enough courts to meet demand adequately in the United States.  There are many reasons why racquetball courts and tennis courts are not financed.  They include: (1) the property is too specialized; (2) uncertain long-term appeal; (3) difficult to judge management expertise; (4) lack of long-term financing; (5) no prolonged experience to draw from; (6) concern about overbuilding; (7) lack of financial strength of principals; and (8) investors are not interested in this type of property.

The Income Approach is the reliable approach to use when appraising tennis and racquet clubs and can inform the client of how to capitalize estimated future earnings.  The process is to project gross revenue from all sources and deduct from them the estimated annual operating expenses of all types.  The resulting net income may be converted to application of a capitalization rate, and may include both the direct capitalization analysis and the yield capitalization analysis.  The Sales Comparison and Cost approaches are often used too.  The approaches are then reconciled into a single value.  Be careful that any intangible assets and furniture, fixtures, and equipment are not included in the appraisal of real property. 

Only two typical situations involve appraisals of clubs: (1) the club operates in leased quarters, and (2) the club owns the real estate and other assets.  Leased quarters can be a multiple tenancy or in a freestanding building.  An analysis of contributions of intangible factors to the overall value follow the same methodologies in all cases.  As a simplification, the business value may be estimated as the difference between the Income Approach and the Cost Approach. 





Appraisal Review

In virtually every trade and profession, certain persons review, criticize, critique, inspect, examine, cross-check, retest, question, judge, or comment on the work of others.  The essence of appraisal review is to investigate, analyze, and verify the logic, procedures, and methodologies used in appraisal reports to insure that the preparation is competent and thorough, and results in a reasonable estimate, which instills confidence in the reliability of the appraisal report for the client. 

There are various types of appraisal reviews:

A technical review is performed by an appraiser in accordance with Standard 3 of USPAP. 

An administrative review is recognized as a compliance review, usually performed by a client or user and may not necessarily be performed by an appraiser, nor is it bound by Standard 3 of USPAP.  It may just be a preliminary review as part of a technical review process later on. 

The reviewer may suggest several courses of action.  For example:

  •  Additional market data be obtained
  •  Specific pages be corrected for compliance
  •  Interviews be scheduled with people familiar with the property
  • Opinions be obtained from experts in related disciplines

When a field review is needed, the review appraiser conducts a field inspection.  Suggested criteria to measure reviewer performance include:

  • Technical ability
  • Timing
  • Quality of review
  • Conclusion

The appraisal review includes various processes:

  • Real estate to be appraised
  • Property rights involved
  • Use of the appraisal
  • Definition of value
  • Date of value estimate
  • Scope of the appraisal
  • Other limiting conditions

Furthermore, general data consists of information on social, economic, governmental, and environmental factors that affect value.  Also, highest and best use is concluded, taking into consideration what is legally permissible, physically possible, and financially feasible.  Then the three traditional approaches of value are analyzed for reasonableness and accuracy. 

The common reporting deficiencies in an appraisal report include:

  • Poorly written report which is not convincing to the client or reviewer
  • Lacks organization that limits comprehension by the reader
  • Lacks a favorable impression of the appraiser
  • Avoids the main issues and/or inconsistencies within the report
  • Lack of analysis
  • Lack of guidance throughout the report
  • Discrepancies between data analyses, which erodes confidence in its conclusions
  • Reasoning is not straightforward and reasonable
  • Incomplete information of a sale or comp
  • Lack of reconciliation of different value

Finally, the reviewer’s role is to determine if an appraisal report (1) meets acceptable standards in the criteria of the client and users of the report; (2) conforms to the Uniform Standards of Professional Appraisal Practice (USPAP); (3) complies with governmental regulatory requirements; and (4) concludes with a reasonable and reliable market value estimate. 

The client generally wants the appraisals to:

  • Identify market trends
  • Clearly describe the property
  • Explain apparent legal obligations that go with the land, including    covenants, conditions, restrictions, easements, and zoning
  • Provide detailed sales, rental, and investment information regarding similar properties in the same market
  • Outline both property and market risk parameters
  • Provide valuable market trend information
  • Notify the client of any potential environmental hazards
  • Serve as a valuable management tool for portfolio planning and advising third-party clients



Advertising Billboard

Billboard2Large outdoor advertising structures typically found in high traffic areas such as alongside busy roads.  Billboards present large advertisements to passing pedestrians and drivers.  Typically showing large, ostensibly witty slogans, and distinctive visuals, billboards are highly visible in the top designated market areas.  Bulletins are the largest, most impactful standard-size billboards.  Located primarily on major highways, expressways or principal arterials, they command high-density consumer exposure (mostly to vehicular traffic).  Bulletins afford greatest visibility due not only to their size, but because they allow creative “customizing” through extensions and embellishments.  Posters are the other common form of billboard advertising, located chiefly in commercial and industrial areas on primary and secondary arterial roads.  Posters are a smaller format than bulletins and are viewed principally by residents and commuter traffic, with some pedestrian exposure.


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