Saturday, May 16, 2009

The value of a "right-of-way" in Cheshire

In response to the Herald piece on the Council granting an easement for Richmond Glen (by Josh Morgan), I just got a call from a resident. He read the comment:

"Republican Councilor Tim White had hoped a fiscal impact analysis would have been done on the proposal and wanted to know the fair market value of the piece of land. White said the value of the land should be known before giving it up for $10."

The resident couldn't help himself from calling me. He had to share his personal story with me.

He said back in the late '60s that he sold a piece of property. However, when he sold the property the lawyer forgot to include a right-of-way (ROW) in the contract. So the buyer later returned to him to buy a ROW. Though it surprised the seller that a ROW was distinct from owning the land, he ultimately got paid for the ROW in a separate transaction.

The payment for the ROW in the late '60s?

$2,000.

Yup. I'm sure the value of the Richmond Glen right-of-way - a ROW that increased the sales value of the property by $12,000,000* - was properly placed at a grand whopping $10.

November can't come soon enough.

Tim White

* $12,000,000 = $500,000 x 24
24 = 41 units less 17 units
41 units is the number of units that can now be built with the easement
17 units is the number of units that could be built without the easement

29 comments:

Anonymous said...

Keep beating the dead horse idiot

Anonymous said...

Tim,

In my 30 plus years as a personal equities trader I can tell you that "things" double on an average of every ten years or less. Taking this into consideration and using my formula and the $2000 from your story, it would go something like this:

*1960 to today = 50 years or 5 (doubles)

$2,000 x 2 = $4,000 in 1970.
$4,000 x 2 = $8,000 in 1980.
$8,000 x 2 = $16,000 in 1990.
$16,000 x 2 = $32,000 in 2000.
$32,000 x 2 = $64,000 in 2010.

So, if the ROW is of equal s/f that means on average the equity value of the land would be more or less equal to $70,000.

As for your last blogger, I wonder if he/she weighs as much as a horse?

mjr

Robert DeVylder Jr. said...

MJR's formula puts the ROW value right where Brodach paid for it. I agree with his theory but also agree with the first poster and it is a done deal so maybe we could move on.

tim white said...

it is a done deal so maybe we could move onI disagree. Actions (and votes) have consequences.

As for the value of $2,000... I have no idea if the two easements are of equal value. My point was that easements have long had value greater than $10.

Robert DeVylder Jr. said...

But the value is not $10.00. Brodach is also giving the town $70,000+ for repairs to Weise Rd in exchange for the ROW. Why is that point being missed? Also, if the right of way in your story was for a residential house, it could have been an equal 500' long but probably was not as wide. If it was for a development, the width could be the same. Either way, Brodach is paying a more than reasonable rate for a 1/2 acre lot in Cheshire.

Anonymous said...

Tim,

Keep your focus on November, I know you won't give up the good fight. This battle is over but it will not be forgotten. You are the watchdog of frivolous spending of tax payer money in this town. Unfortunately, you are outnumbered.

I mean, you should not roll over and play dead, please don't misunderstand me..I think you should continue to be the eyes and ears of the to often financial (give-away,) spending of Cheshire's tax dollars, but when the vote is cast and it goes in favor of wasteful spending and higher taxes during a recession, Cheshire's homeowners are not stupid..we will NOT forget which council members voted for or against common sense decisions.

As a side note..and I do respect Robert for who he is, but as a real estate agent for four years now, I can show you many 1/2 acre lots in Cheshire that went for $125k and up depending on location and other amenities.

I also believe that to make these Brodach properties marketable, they would need to spend the money on making repairs to Weise Road anyway. Leaving the road in its present condition would make for a poor first impression and in RE, first impressions count. Most people make up their minds to buy a property within 10 seconds of their first impression.


mjr

Anonymous said...

"But the value is not $10.00. Brodach is also giving the town $70,000+ for repairs to Weise Rd in exchange for the ROW."

The problem is, Weise Rd. was just repaired. We have not received the $70K.
Will they have to dig it up again to put the road in?
What is our benefit?

Robert DeVylder Jr. said...

Im sure that the payment will be made once the land is in Brodach's name and the closing is complete. Even if they have to dig the road up, they are responsible for the cost to repair any damage they cause. The road has to be returned in the same state they found it.

Anonymous said...

But what is the $70K for? To repair the road of are they paying for the easement that way?

I thought the $70k was the cost to repair Weise Rd., which was just re-paved.
I don't get it.

Robert DeVylder Jr. said...

THE $70,000 IS TO REIMBURSE THE TOWN FOR REPAIRING THE ROAD! ONCE THE REPAIRS ARE MADE AND THE TOWN SIGNS OVER OWNERSHIP OF HE ROW, BRODACH WILL WRITE A CHECK FOR $70,000

tim white said...

The $70k is unrelated to the easement. I understand that if the 17 unit (no easement required) development happened, the road would have needed to be improved... as it was improved regardless.

Anyway, my point was about getting a fair market value and performing a fiscal impact analysis.

Those two concerns remain unaddressed and I don't see any logical (and consistent) reasoning for it offered by the Council majority.

Anonymous said...

"BRODACH WILL WRITE A CHECK FOR $70,000"

The town's work is done. Where is the money? When will we get the money? You evidently must know.

Anonymous said...

The road doesn't need fixing, it was just paved. They are just going to dig up what was just paved and make it sound like they are helping the town...
Total B.S.!

Anonymous said...

how much clearer can Rob make it?

Anonymous said...

I guess he needs to make it a lot clearer for any of us to believe this is a benefit to our town.

It sounds like they are going to have to dig up parts of that road and then repair them.

Explain the benefit.

Anonymous said...

so what if they dig up the road? the road upgrade is complete and adding half million dollar homes to the area will increase property value. if this is a settled issue, why is it still being discussed? let it go!

Anonymous said...

9:01
You don't get it....
$10 to the town to allow them to build 24 more units which could eventually put a strain on our sewer system is not a fair deal for this town.
Why did the Dems, just a year ago. try to "extort" money from AT&T for a similar easement, but when the smarter people on the TC suggested getting a fair value they called it extortion?

I find it hard to believe that these homes will increase the property value for the surrounding homes.
There are people who are trying to make it sound like the $70K is a benefit to the town, when it isn't. They are just fixing what they messed up.

Anonymous said...
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Anonymous said...

10:47
Showing your lack of class here won't get you far. Obviously you must have some financial interest in this deal or you wouldn't be so arrogant. Talk to the people who live in the Buckland area, see if they are in favor of this.

Again, this is about the $10 easement. Where is the benefit to the town? We give up a piece of property to allow the developer to build an additional 24 units. Who is benefiting? Who will pay when the sewer hook ups come? Not the developer.
I wonder if $70K is even enough for the road repairs....what did it cost to widen the road totally?

Please try to respond without the vulgarities, you appear to be childish.

Anonymous said...

open a newspaper idiot. the neighbors met with the developer and are ok with it as long as work trucks do not drive on their road. the 70,000 wont cover the entire cost of the job but it is close. the 10 dollar easment was more symbolic than financial. the town cannot give that land away as stated by the town attorney during a council meeting.

Anonymous said...

Okay, so now you are looking like a real genius.
Your command of the English language is amazing.
What a class act you are...

Almost covers the cost?? What is almost?

The $10 easement was "symbolic". Why did it have to be symbolic? By the town allowing this easement, we are giving the builder the opportunity to make a boat load of money. Since when should the town be so generous to a developer??
Especially in an economy where we are doing major cuts to the budget. Makes no sense.

Lets really see if the neighbors are okay with this when they lose their cul de sac and start seeing a lot more traffic going through this quiet neighborhood.

Still wondering about when these home owners decide to hook up to the sewer system, who will cover the cost of the added waste going to our already overtaxed system.

Anonymous said...

I wonder if the 5 Dums on the council will get a nice reward. They certainly deserve it.

Anonymous said...
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Anonymous said...

Class Act!

Keep showing your intelligence...

I bet you can be one of those Dems on the TC with that attitude and vocabulary.

Anonymous said...

DeVylder is wrong...as usual.
The $70,000 was agreed to in 2005 for road work because of sightline and safety issues. It had NOTHING to do with the easement.
Brodach got it for $10.
The Councilmen who voted for this were useful idiots.

Anonymous said...

You are all overlooking something that is right before you.
Wiese has been rebuilt....except for the bridge going over Honeypot Brook. The town's own PW department was cited by the Wetlands commission for not following proper procedures....this is over a year ago.
Take a hard look at the capacity of the culvert. Now imagine 41 houses immediately upstream. 41 roofs, driveways and roadways pouring water into this culvert.
You don't have to be a civil engineer to realize this is going to be a problem.
So...is the bridge not done because the chief wizard in the PW department knows that this has to be dug up and replaced with something bigger? Hmmmm. Who pays for that?
These are the unseen costs of development that no one pays attention to until projects get built, the developers ride off into the sunset with their money and the taxpayers are left holding the bag.
One other example....ever travel down Cheshire Street when it is raining hard? Ever notice all the water spilling down the new road (up near intersection with East Johnson Ave.) for the Calcagni/Matt/Paul/Brodach/Whoever McMansion development? Notice the inadequate drains? The need for the town to repair damage along Cheshire Street? Who pays for this?
You do.
Have a good day.

Anonymous said...

Then why are they holding up on paying for it?
If it was agreed on in 2005 and the road work was complete last fall, why are they holding up the payment?

Does anyone know how much that road work cost in total?

I have to believe $70K is a drop in the bucket for the amount of work they did.

Anonymous said...

they were only going to pay if they got the easement. Check is probably in the mail

Anonymous said...

Check is probably in the mail

HA, HA, HA......

Tim: Could you ask the TM if he got the check and if not what he is doing to get it.