Specialized Asset Types
Appraisals are often required by foreign governments in order to report the fair market value of their embassy and ambassador’s residences. These properties can be located in office buildings (office suites), stand-alone single-family residences, condominium complexes, or major corporate office complexes specially designed for the embassy (ie US Embassy Mexico City). This usually depends on the size of operations in the country, and how large the host country is.
LOGAN has worked with the United States, Canada, Denmark, Ireland and other nations in the appraisals of their foreign state department holdings. These valuations have been written in English and Spanish when needed and follow RICS guidelines and may be signed by an MAI designated appraiser.
Cost approach – due to special use and design of embassies and ambassador residences, the cost approach is more relevant.
Sales comp or market approach – sometimes difficult to find similar comparables – especially when the asset is a single-family home, as embassies usually own residences in in-fill locations where properties rarely trade. These ‘embassy zones’ usually have colonial or protected architectural homes, which do not trade very often. This approach is very common for condos and office properties.
Income capitalization – this approach may be applicable if there are similar embassy properties of other countries which are being rented. This approach can be used if the property is an office suite, building, or an income producing property.
DCF – could theoretically be applied, however, the property needs to have rent comparables available which are similar to the subject property. This approach is used when the property is an income producing property such as corporate office towers.
Residual – if an embassy property is a single-family home or stand-alone project without architectural restrictions for redevelopment, there could be hidden development potential in such property. Periodically, zoning laws change and allow for additional density to be develop qd, especially in infill locations. Sometimes, the highest and best use of these properties is re-development, whereas the land is valued, and the improvements do not contribute value.
Area where properties are located – often embassy properties are located in exclusive areas. Usually, these areas are located in the high demographic area of the capital or secondary city of a country. Further, in these infill areas, there is a scarcity of land and of single-family homes which could be used as an embassy.
Construction quality – often embassies are located in colonial and architecturally protected buildings that have ornate facades. The buildings are visually pleasing and command high values.
| Colombia | Mexico | Peru | CR-CA | |
|---|---|---|---|---|
| 1 | Bogota, 26 Ave | DF, Polanco | Lima, Miraflores | San Jose, Escazu |
| 2 | Bogota, Chico | DF, Santa Fe | Lima, San Isidro | Panama City |
| 3 | – | – | – | Guatemala City |
Leadership Team
ARGUS Developer helps set standard for complex modelling in latin america
LOGAN Valuation is an institutional real estate valuation and consulting firm serving Latin America, with offices in Colombia, Peru and Mexico.
BASE PG – Office Market Study Colombia
Project Leaders: Diego Rodriguez Rueda, MRICS; Jessica Suarez Needs Market information for use with investors, banks, and for management.
