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EASEMENTS ACQUIRED Temporary Easement The value of the Temporary Easement (TE) is calculated using the land rent method. Due to the temporary nature of the easement, a common valuation technique relates the easement term to a rental period. The fee value is related to an appropriate rental rate, typically 6 to 10% of fee value based on available ground lease data. For residential properties similar to the subject, an 8% rental rate is used. An annual rental amount is determined based on the TE area and rental rate, which is further extended to a total rental amount for the TE period. Since payment will be applied as a single upfront payment, as opposed to a series of annual payments, a present worth factor is considered, which will discount the total rent to a present value of the rent stream. Based on current treasury yield rates for a 5 to 7-year term, a reasonable discount rate of 1.50% is applied, and assumes no future increase in the land value over the rental period. The expiration date of the temporary easement is 12/01/2025, resulting in a total TE period of approximately 5.88 years as of the effective date of this valuation. The following table displays the factors and calculation of the TE value. Annual Rent Market Rent ($/Sq.Ft.) TE Area $4.90/S .Ft. 8% Extension 699 Sq.Ft. x $0.39 = $274.01 Total Rent Annual Rent I TE Term Extension $274.01 1 x 5.88 Years = $1,611 Present Value Factor Term Discount Rate Extension 5.88 Years 1.50% = 0.9162 Calculation of Damages Total Rent Present Value Factor Extension $1,611 x 1 0.9162 = $1,476 Estimate of Damages for Temporary Easement $1,476 IMPROVEMENTS ACQUIRED The acquisition of Parcel 229C from the subject property will include the removal of existing concrete driveway surface that is located within existing right of way. Although encroaching within the right of way, the established driveway location was based on the direct access to Oxford Avenue NW, a city street. The existing highway right of way was acquired back in 1941 and this driveway location had been perpetuated over the years to provide the most direct route to the property from Oxford Avenue. Therefore, based on the lengthy history of the improvement and original intent of it, the portion of the driveway to be removed is not considered to be an encroachment and is believed to be a compensable site improvement. Approximately 400 square feet of the subject's existing concrete pavement will be removed from the existing right of way. The replacement cost of the pavement is estimated from Marshall Valuation Service, a national replacement cost estimation guide. The replacement cost is estimated at $6.85/Sq.Ft., which extends to a replacement cost of the acquired concrete of $2,740. Based on the current condition of the concrete and the total life expectancy in relation to the age, the appraiser has estimated a physical depreciation estimate of 50%. Therefore, the as -is value of the acquired concrete surfacing is $1,370. There are no other building or site improvements to be acquired for this proposed acquisition. S.P. 7102-135RW C.S. 7102 (10=3) 902 Parcel 7102-902-229C Page 44