Opinion
No. CV 04-4003386
March 24, 2006
MEMORANDUM OF DECISION
This is an eminent domain proceeding concerning a property known as 3 Tunxis Avenue, Bloomfield, Connecticut (herein sometimes "the property" and sometimes "the subject property"). On September 28, 2004, the Town of Bloomfield filed a Statement of Compensation and deposited $290,000 with the Clerk of the Superior Court for the Judicial District of Hartford at Hartford. The Statement of Compensation identified the owner of the subject property as Three Tunxis Avenue, LLC ("owner") and its address as c/o Naro Realty, 11 Tunxis Avenue, Bloomfield.
The owner filed an Appeal and Application for Review of Statement of Compensation on November 22, 2004. It claims to be aggrieved by the statement of compensation and seeks review of the assessment of damages because it is inadequate. On that same date, the owner filed a Motion for Payment of Deposit pursuant to General Statutes § 8-130. The motion was granted and the $290,000 on deposit with the clerk was paid to the owner. Thereafter, the owner filed a motion for hearing; the matter came before the undersigned to determine the value of the property as of October 13, 2004, the date of the taking. Both parties appeared by counsel and presented evidence including the testimony of their respective appraisers and their reports.
Connecticut General Statutes § 8-132 limits applicants for a review of the statement of compensation to persons who are aggrieved. Although the Statement of Compensation identifies the defendant as The Masonic Hall Association, it identifies the owner at the time of taking as Three Tunxis Avenue, LLC. There is no dispute that The Masonic Hall Association sold and transferred the subject property to Three Tunxis Avenue, LLC prior to the taking by the Town of Bloomfield. From the evidence, it is found that Three Tunxis Avenue, LLC was the owner of the property on the date of condemnation and is therefore aggrieved. Bossert Corporation v. Norwalk, 157 Conn. 279, 285 (1968).
The subject is located on the westerly side of Tunxis Avenue, AKA Route 189, in Bloomfield, Connecticut. The property is located in a business zone (Zone B) and consists of 0.29 acre (12,632 square feet). It is improved with a two-story frame structure, built around 1923, and has a gross building area of 4,442 square feet. The building has been utilized as a masonic hall-recreational type property and a church.
On September 3, 2004, approximately six weeks before the taking, the property was transferred by warrantee deed from The Masonic Hall Association, Inc. to 3 Tunxis Avenue, LLC, the owner condemnee, for the sum of $280,000. At that time and at the time of the taking on October 13, 2004, Robert Schwartz, a principal of the owner of the subject property, owned all or part of an adjoining parcel, a vacant gas station site, to the north of the subject property.
In arriving at opinions as to the fair market value of the subject property at the time of the taking, the plaintiff's appraiser, Christopher Italia ("Italia"), utilized the Comparable Sales Approach and the Income Capitalization Approach; the appraiser for the defendant, John Lo Monte ("Lo Monte") utilized the Comparable Sales Approach and the Cost Approach.
Lo Monte rejected, as do I, Italia's use of the income capitalization approach because there is no adequate rental data for the subject property, only evidence a tenant church was paying a "nominal rent." On the other hand, Italia rejected, as do I, consideration Lo Monte's use of the cost approach because the subject property does not fit Lo Monte's own criteria that "the property has to be at its highest and best use, and the improvements should be relatively new."
Both appraisers used the comparable sales approach, and that is the method the court considers most appropriate. Italia rendered an opinion that the fair market value of the property was $310,000 at the time of the taking. Lo Monte estimated the fair market value of the property at the time of taking to be $415,000. The significant difference in their opinions follows in large part from their selection of different comparable sales and their selection of different comparable sales follows from their choice of the highest and best use of the property.
Before the court can determine the value of the property at the time of the taking, it must resolve what use best describes the highest and best use of the property at the time of the taking for the purpose of determining the appropriate choice of comparable sales. Additionally, in light of the claim of the owner that the assemblage doctrine applies to the subject property because of the owner's plan to develop the property using the adjoining lot to provide additional parking spaces, the court must determine by how much the "assemblage" enhances the value of the property on the date of the taking.
Lo Monte opined that the "subject's current use as Fraternity Hall, flex-use property is not considered to be its maximally productive use, or that use that will generate the highest return to the land," but that it is the highest and best interim use "until such time that the property could be developed with other property of the owner, in proximity of the subject itself" and "assembled and, or for conversion and, or for demolition of existing structure and development as per zoning and market demand." He goes on to state, "To make such an analysis of the site is beyond the scope of this appraisal but for the purposes of this appraisal the (interim) use is considered to be its best and highest." Having chosen the Fraternity Hall, flex use property as the highest and best (interim) use, Lo Monte then states in his report that it is virtually impossible to find truly comparable sales within the subject's market area, so he utilized sales of flex-use commercial properties within the region and the subject's market area.
Italia testified that the subject property consists of a former Masonic Hall built in 1923 which was being used as a church with the potential to be converted into an office use with limited reconfiguration. Italia opines that the highest and best use is a single-story commercial development, and he reports on those comparable sales, including the sale of the subject premises to the owner.
After reviewing the evidence regarding comparable sales, including their locations, descriptions, photographs and the adjustments made, the court finds that the flex use of the property as a social hall/church is of a special and limited nature, that the property is a "a specialty property" and that the rationale of Italia for his choice of highest and best use and his choice of comparable sales is more appropriate and reliable than that of the plaintiff's expert.
That, however, does not end the inquiry because of the claim of the owner's principal, Robert Schwartz, that the assemblage doctrine is applicable to the subject property. The assemblage doctrine is applicable in the context of a condemnation case for valuation purposes. See Commissioner of Transportation v. Towpath Associates, 255 Conn. 529, 767 A.2d 1169 (2001). "The doctrine of assemblage applies when the highest and best use of separate parcels involves their integrated use with lands of another. Pursuant to this doctrine, such prospective use may be properly considered in fixing the value of the property if the joinder of the parcels is reasonably practicable. If available, this doctrine allows a property owner to introduce evidence showing that the fair market value of this real estate is enhanced by its probable assemblage with other parcels." Route 188, LLC v. Town of Middlebury, 93 Conn.App. 120, 126, 887 A.2d 958 (2006).
Robert Schwartz testified that at the time the subject property was purchased, the adjoining vacant lot which had contained a Mobil Station was available for additional parking and by virtue of the additional parking he planned to raze the building and develop a medical office building containing 6,600 square feet on the subject property. I find that it is reasonably probable that Schwartz had some such plans at some point prior to purchasing the subject property and that the ability to use the adjoining lot for additional parking might enhance the value of the subject property. Whether being able to use adjoining property for increased parking and/or whether enlargement of an existing use, rather than a change of use is what is envisioned by the assemblage doctrine is open to question. Assuming arguendo, however, that the assemblage doctrine does apply in this case, there is no basis on which this court can determine and find that the fair market value of this real estate is enhanced by its probable assemblage. Sees Route 188, LLC v. Town of Middlebury, supra. The defendant's appraiser seemed to consider assemblage in the future a possibility when he referred to the highest and best (future) use as "assembled and, or for conversion and, or for demolition of existing structure and development as per zoning and market demand." But he went on to state, "To make such an analysis of the site is beyond the scope of this appraisal." Moreover, based on the evidence it is also likely that the price of $280,000 paid by the owner to purchase the subject property included consideration that reflects an enhanced value for assemblage in light of the testimony of Schwartz that he had been "chasing that property" for three years, that no broker was involved in the sale and that a tenant would remain in possession for nine months.
The court, having given consideration to the evidence, in particular the comparable sales contained in the report of the plaintiff's appraiser, the arguments of counsel and the court's familiarity with the location, finds the value of the property at the time of the taking to be $310,000. Since the deposit of $290,000 has already been transferred to the owner of the subject property, Judgment may enter for the defendant for $20,000, the amount of the deficiency. See General Statutes § 8-130.