CFA/CPA/CA Condo Wind Up Valuation Qs

[Tay Huang]

What is a fair valuation model for a 180 unit condominium located on a very large parcel of land (525,000 buildable sq ft), in a prime suburb, and specifically located in its highest demand neighborhood for new condominiums?

Using 17 comparable transactions from November 2020 to present day, which  a include a neighboring city with (ballpark) similar price correlations, the price per buildable square foot was $116.

I advocate that because the Pandemic was by definition a Black Swan event, and that particular market has proven to be resilient despite rate hikes, with condominiums gaining an excess of 13% year over year , that it would be more accurate to use in comparables only transactions that took place over the last year, leaving 7 of their original 17. Doing so changes the price per buildable square foot to $139. 

Three questions for CFAs or CPA/CAs with extensive suburban multi-family commercial real estate experience :

1) Which price per buildable square foot do you feel is more ethical?          

2) What would you include in the balance of your valuation?    

3) Have you noticed Deferred Maintenance being an issue that has a great deal of “opinion” built into the estimations?  

I presume this is where much of the incongruity lies. Owners, many of which are old, are being offered an incredibly low price for their homes.  
I look forward to your replies.

Cheers.