It can make it tough to get an appraisal to justify current list prices.

That may be why I heard that many ADUs are appraised around the building cost.

I wouldn't recommend subdividing them and putting utilities in. multifamily entitlement is much higher returns than subdivisions. just my advice but I have 10 years of experience in agency, appraisal, development, construction, from a national perspective but based out of columbus 

We scheduled the appraisal which was a full appraisal for May 6th.

Hi @Somesh MukherjeeFellow lender here - Not sure where you are in the process but as Matthew said - location is top priority, not just in terms of the tenant pool but depending on the loan program you're seeking (say DSCR), the comps in the area can also impact your appraisal and what rate and term you'll qualify for.

Also are appraisals always required I know that some companies used BPOs.

Even the appraisals were up.

They can only loan in certain states and their investors choose whether  to lend on a particular project after you wasted a lot of time and money for appraisals. 

No appraisal was performed.  

I check county records, tax records, current appraisal from the local municipality, and check for comps in the local are with respect to the properties condition.