08-15-2025 - Appraisal- 925 Industrial Way Ellensburg WA 98926

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COST APPROACH The cost new is usually estimated by comparing construction costs of similar structures that have recently been built with data that is published in national cost factor books. This information is then applied to the subject with adjustments made for the individual components of the structure. Depreciation is then subtracted from the estimated replacement cost to arrive at a depreciated cost. The source for estimating the replacement costs of the subject is the Marshall Valuation Service. Depreciation There are three types of depreciation that need to be addressed. The first is physical depreciation, which is the actual wear and tear on the structure including mechanical, electrical, plumbing, etc. This can be measured either by the actual cost to remedy the physical deficiency, including an allowance for the roof, plumbing and basic structure, or by the market. If two buildings have sold, one in need of the same repairs as the subject and one in new condition, the difference in sales prices are recognized as physical depreciation, after the land values have been accounted for. Another method of estimating accrued depreciation is the Age-Life method,which expresses a ratio between the effective age of the improvements and total remaining economic life. The Age-Life Method will be used to estimate depreciation for the subject. The second type of depreciation is functional obsolescence that is in two forms, curable and incurable. This is measured either by the cost to cure the functional problem; by capitalizing the reduced net income caused by the functional problem; or by comparing the sales of two structures, one that is similar to the subject and one that has no functional problems. No functional obsolescence is recognized for the subject. The third type of depreciation is economic or locational obsolescence. This is measured by capitalizing the amount of net revenues that CANNOT be collected due to the location of the building as compared to competing properties. No economic obsolescence is recognized for the subject. Prior to calculating the Cost Approach to value, the land value will be estimated and subsequently be added to the depreciated replacement cost for the subject. Because of limited industrial land sales in the City of Ellensburg, the market was expanded to Yakima, WA which is 34 miles south of Ellensburg. The following are land sales which were used to estimate the value of the land for the subject. 47 DAVIS APPRAISAL COMPANY