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1 <br /> I Market Value Appraisal: 4138 Vineyard Avenue, Pleasanton, California Page 36 <br /> development (PUD) for such a development project. Therefore, redevelopment of <br /> 1 the subject site, as vacant, with multi-family rental residences is considered likely to <br /> be deemed legally permissible. <br /> 1 The financial feasibility and maximum productivity factors consider which potential <br /> land uses could generate a positive cash flow to the property (financial feasibility), <br /> and subsequently, which would generate the greatest return (maximum productivity) <br /> to the land. <br /> In the current market, brokers report that the demand for developable residential <br /> land is depressed. The ready availability of improved residential properties at <br /> attractive prices is enticing buyers to the real estate market. Home sale prices are <br /> I impacted by the increased percentage of short sale and foreclosed, real estate owned <br /> (REO) properties in the market. Construction costs place downward pressure on <br /> prices of vacant land that must be purchased for development of new residences. <br /> • <br /> The combined land and construction cost must compete with the current sale prices <br /> of improved residential properties. Based on current market conditions and limited <br /> demand for vacant residential land, the development of a residential project may not <br /> 1 be financially feasible. A more prudent strategy in the current economic <br /> environment would be to retain the parcel as vacant until market conditions <br /> improve. <br /> In summary, the size of the subject site, its specific location, current planning and <br /> zoning regulations and market dynamics for residential properties in Pleasanton <br /> 1 suggest that interim holding of the land for future development of a multi- family <br /> residential development project would likely be the highest and best use, as if vacant. <br /> 1 B. As Improved <br /> The subject site is currently improved with a single family residence and a storage <br /> I barn. The residence reflects average quality and condition. The storage barn is in <br /> poor condition. The current use is legally non - conforming (given the below standard <br /> lot width and east side yard setback) and physically possible. The physical <br /> 1 characteristics of the subject improvements were discussed in detail in the <br /> improvements analysis. Both the layout and positioning of the improvements are <br /> considered functional for residential use. The storage barn is not considered to <br /> 1 <br /> contribute to the value of the subject. <br /> The maximally profitable use of the subject as improved should conform to <br /> 1 neighborhood trends and be consistent with existing land uses. Although several <br /> uses may generate sufficient revenue to satisfy the required rate of return on <br /> ' investment and provide a return on the land, the single use that produces the highest <br /> price or value is typically the highest and best use. As shown in the applicable <br /> valuation sections, single family residences that are similar to the subject have been <br /> 1 ENRIGHT & COMPANY, INC Real Estate Appraisal Consultation Services File: 11- 892 /Text <br />