|October 13, 2012|
Previously published on Fall 2012
Property in Woodbury comprising two parcels was purchased for a total of $2.55 million in November 2007; the purchase prices for both parcels were established in contracts entered into in late 2003 and 2004 - frothy times in the real estate market. Prior to the closing of the purchases, development approvals were obtained for more than 40,000 square feet of retail store space on the site but a specific application to create a Dunkin Donuts store was denied sometime after the October 1, 2008, Woodbury revaluation. The plaintiff’s property was initially valued at slightly more than $2.8 million. An appeal to the Woodbury Board of Assessment Appeals resulted in a reduction to slightly less than $2.4 million.
Both parties’ appraisers relied on the market approach. But that was the only common thread. With the plaintiff’s appraiser estimate of value at $710,000 and the Town’s appraiser essentially echoing the BAA-reduced market value, the court determined that “the most influential sale” for its purposes was in fact the November 2007 acquisition by the plaintiff of the parcels in question. The court based its conclusion on the fact that while the sale contracts pertain to raw vacant land, the plaintiff had been successful in obtaining development permits and financing prior to the revaluation date. As a result, the plaintiff had failed to meet his burden of proof. “(The plaintiff’s appraiser’s) opinion of value for the subject property of $710,000, when the plaintiff purchased the subject property for $2.55 million, less than one year from the date of revaluation, is not credible.”
Reading between the lines a bit, it appears that these properties were purchased just as the real estate market hit its peak and that by the time of the revaluation, slightly less than a year later, the ability to move forward with the development likely was affected by the horrible economic circumstances obtaining as of October 1, 2008. If this was the case, the court was not presented with sufficient evidence to reach that conclusion and the plaintiff was unfairly saddled with its purchase price as the basis for its assessment.
Eyre, LLC v. Town of Woodbury, Superior Court, Judicial District of New Britain, Docket No. CV-09-4027964, May 16, 2012.