Highest and Best Use – Full Development Potential

Goal:

Clients wanted to maximize the compensation received for the taking.

Success:

Upon inspecting the property, Joseph Suntum noted that the property was surrounded on three sides with townhome developments and the sole access to the clients’ property was through these townhome developments.  The backside of the property was bordered by a creek separating the property from a single-family neighborhood across the creek and a primary road. Joseph Suntum convinced the appraiser engaged by the State that the highest and best use of the property was for the owners to apply to have the property rezoned for townhome development and that there was a reasonable probability that such an application would be granted. Consequently, the State’s appraiser valued the property based on its reasonable probability of being rezoned to permit a more valuable use. The State offered the client $1,483,750 in compensation for the taking. Although the State’s appraiser appraised the property based on a higher value of use, the appraiser did not know the full development potential of the property and, consequently, could not accurately determine the full value of the property that was taken. Joseph Suntum engaged a land planner to prepare plans reflecting the full development of the property and the loss of development potential caused by the taking. The full difference in value between the before value of the property and the after value of the remainder could then be appraised. Upon proof of this difference in value the State agreed to pay $3,698,000 in just compensation to the clients.