Opinion
December 15, 1969
In a condemnation proceeding, claimants upon Damage Parcel 15 appeal, as limitedly by their brief, from so much of a final decree of the Supreme Court, Kings County, entered December 3, 1968 after a nonjury trial, as awarded them $15,500. Decree reversed insofar as appealed from, on the law and the facts, with costs, and appellants' award increased to $17,000. In our opinion, the award of $15,500 for Damage Parcel 15 is inadequate in view of the expert testimony. Respondent's appraiser found the gross annual rental to be $3,000 and he estimated the expenses to be $1,209. Based on these figures the net annual rental is $1,791. Respondent's expert also deducted an additional $150 as a "reserve for contingencies", but this appears to be a largely overlapping deduction in view of a previous $100 deduction for a "replace reserve" and one which ought not to be made. Based on a net annual rental of $1,791 and using the land appraisal of respondent's expert who found the land to be valued at $4,125, it appears that the award was inadequate under the so-called "economic approach" to valuation (see Matter of City of Rochester [ Genesee Crossroads-Friedman], 30 A.D.2d 634; Shafer Bldg. Corp. v. State of New York, 29 A.D.2d 832). If we impute to the land income of $247.50, by using a 6% capitalization rate for the land, the building is valued at $12,862.50 based on a 12% capitalization rate on the remaining annual income of $1,543.50. Adding the value of the building ($12,862.50) to the value of the land ($4,125.00), the total value would be $16,987.50. Accordingly, based on the figures of respondent's own expert, the award of $15,500 is inadequate under this approach. An award of $17,000 is warranted on this record. Christ, Acting P.J., Rabin, Hopkins, Benjamin and Martuscello, JJ., concur.