Authored by Robert E. Bainbridge.
Published by the Appraisal
Chicago, IL. 2012.
316 Pages. Illustrated.
The most authoritative
on the appraisal of
and gas stations.
"...an indispensable resource."
Alan E. Hummel, SRA
2003 President of the
|A 5-Star Rating on Amazon.com
5-Star Rating on AMAZON.COM
“Great book, informative!”
“I have this book
and use it often when appraising C-Stores. Well written, informative and provides a lot of useful information…”
NEW FOR 2012! The Second Edition of Convenience Stores and
Retail Fuel Properties: Essential Appraisal Issues includes updated operating metrics from the most recent State
of the Industry reports published by NACS: The Association of Convenience and Fuel Retailing. New chapters explain
the fundamentals of economic theory as applied to convenience retail real estate, eminent domain issues, and highest
and best use decisions for convenience store sites.
The new edition
also includes one of the appraisal industry’s first prototypes of a commercial property AVM (Automated Valuation Model).
The AVM design is drawn from the valuation principals covered in the earlier chapters.
APPRAISAL OF CONVENIENCE
Using the latest digital technology, links are provided to helpful on-line resources, including video instruction,
interviews with experts, practical field examples, and worksheets that illustrate and augment the concepts discussed in the
APPRAISAL OF GAS STATIONS
APPRAISAL OF GAS STATIONS
FROM THE APPRAISAL INSTITUTE:
The convenience industry is a complex and
fascinating retail channel that has responded to the economic challenges of the last decade by embracing new ideas. The second
edition of Convenience Stores and Retail Fuel Properties: Essential Appraisal Issues will help appraisers of convenience stores keep up with
these changes and understand how to value convenience properties. This
new edition demonstrates market analysis using statistical data and information on important recent developments in the convenience
industry, such as:
Newly added chapters discuss the fundamentals of economic theory as applied to convenience retail real estate
domain issues highest
and best use essentials for convenience store sites
an added bonus, the book presents a prototype of a working commercial property automated valuation
model. Links to helpful online digital content, including interviews with experts and practical field examples, are also provided
to illustrate the concepts discussed.
rules for appraising convenience stores simply do not apply today. Order this text and learn the new market realities.
From the Introduction to
Convenience Stores and Retail Fuel Properties: Essential Appraisal Issues
Today’s convenience store
occupies a unique place in the retail landscape. With over 146,000 convenience stores across the USA, more than 117,000
sell motor fuel. Eighty percent of all motor fuel sold in the United States is sold through the convenience retail channel.
This business model of motor fuel sales combined with a limited selection of high-turnover merchandise is the subject of this
book. Convenience stores are special-built properties that are designed to make money in only one way. They are
not easily adapted to other uses. The fundamental determinant of value for a convenience store property is its ability
to generate earnings.
This book is written to help the reader understand the market forces
and design features that create and influence the property value of convenience stores. Chapters 1 through 9 are essential
preliminary background to understanding the factors that create value. Chapter 10 applies this knowledge through the
three approaches to valuation. Simply stated, the value of a convenience store is a product of the characteristics of
the trade area within which the store operates in addition to the physical features of the site and improvements.
Chapter 1 discusses the convenience industry. Current trends in motor fuel retailing and in-store sales are
presented along with sources of data that the appraiser should be familiar. The long-term trends in the industry establish
the 5 to 10-year price-movement for the real estate. So, it is important for the appraiser to know where the convenience
industry is today and where it is going.
Fundamentals of economic theory
applied to retail real estate are presented in Chapter 2. Understanding the interaction of supply and demand in perfectly
competitive markets is presented for a basis of discussion on how economic profit is created for the business
All convenience stores operate within a specific trade area. Whether that
trade area is over-supplied or under-supplied has a profound influence on value. The supply and demand characteristics
of the trade area determine the short-term movement of property value over the next two to five years. A trade area
analysis is one of the weakest area in most appraisal reports. Chapter 3 shows the appraiser how to delineate the trade
area, measure supply and demand, and discusses important sources of data and analytical tools.
Chapter 4 helps the appraiser to analyze the site. Today’s standards for convenience store sites are
discussed, including examples of site development criteria from major retailers and oil companies. Related to site access
and visibility, the specialized topic of eminent domain issues as they relate to convenience retail properties are explored
in Chapter 5. Examples of the economic impact of access degradation for convenience retail real estate are included
in Chapter 5.
Store building assessment is addressed in Chapter 6, and the Fuel
Service and Equipment are treated as separate topics in Chapter 7 and Chapter 8. Industry average cost trends over the
last ten years are provided in each of these chapters.
Highest and Best Use considerations
for convenience stores are covered in Chapter 9. Acquisition and redevelopment decisions are presented as well as the
effects of increasing land values on the highest and best use of a convenience store are presented.
10 addresses the valuation of convenience stores. All three approaches are discussed. However, in accordance with
Guidance Note 12 of the International Valuation Standards the most emphasis is placed on the capitalized earnings
approach as it applies to the total assets of the business. Because it is a component part of these assets, the
value of the real estate dependent on earnings capacity. This is the fundamental premise of the value of a convenience
Looking ahead, Automated Valuation Models (AVMs) for commercial property are one of the
most promising developments in the appraisal profession today. AVMs will play an increasingly important role in
the future of commercial property valuation as more abundant and better quality market data becomes widely available.
Chapter 11 presents a prototype AVM for convenience stores based on the valuaion premises discussed in this book. Comments
on model design and measures of explanatory and predictive capability are included in Chapter 11, along with a discussion
of some of problems commonly encountered and suggestions for further research.
In Appendix A, the reader will find releveant material on the North American
Industry Classification System (NAICS) codes for retail real estate, which are useful for accessing demographic data sources
such as Site To Do Business. Other appendices cover the International Valuation Standards, the International
Financial Reporting Standards, FIRREA, and USPAP.
For a practical application of the valuation principles discussed in
Chapters 1 through 10, the Appraisal Institute offers an online seminar, "Appraising Convenience Stores", which
includes a case study covering the topics presented in this book. The seven-hour seminar is available through
the Appraisal Institute at http://www.appraisalinstitute.org/.