Most appropriate use evaluation of approximate 70 acres tract at NE quadrant of interstate 465 and US 31 by Riachard R Nichols Associates, INc. Immo
mow
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6320 NORTH RUCKER ROAD, SUITE D
INDIANAPOLIS, INDIANA 46220
(317) 257-6255
Mr. Samuel Gillespie July 23, 1987
Trammell Crow Company
8650 Commerce Park Place, Suite L
Indianapolis, Indiana 46268
RE: Most Appropriate Use Evaluation of an approximate 70
acre tract situated at the Northeast Quadrant of Inter-
state 465 and North Meridian Street (U.S.31) in
Carmel-Clay Township, Hamilton County, Indiana
—
Per your request, Richard E. Nichols Associates, Inc. has conducted an in-
spection and analysis of the referenced property for the purpose of
rendering our opinion as to the most appropriate (best) use of the subject
site. Most appropriate use is defined as:
MOST APPROPRIATE USE. In planning and zoning, the land use that
is in the best interest of the community as a whole and will pro-
- mote the greatest good for the greatest number; may or may not be
the highest and best use; may be a present use or a future use.*
Implied within this definition is recognition of the contribution of that
specific use to community environment or to community development goals in
addition to financial feasibility.
*Source: The Dictionary of Real Estate Appraisal, Copyright by the American
Institute of Real Estate Appraisers of the NATIONAL ASSOCIATION OF REAL-
TORS, an Illinois Not For Profit Corporation, 1984, Page 206.
APPRAISING • BROKERAGE • REAL ESTATE • COUNSELING • DEVELOPMENT
In accordance with the foregoing definition, our analysis includes consid-
eration of the referenced property's:
1. physical characteristics,
2. surrounding land uses,
3. demographics,
4. construction activity,
5. general economic profiles of both the Carmel community and
the greater Indianapolis metropolitan area,
6. compatibility of potential development with surrounding
properties.
These uses have been analyzed in the context of the property's "image" lo-
cation at the I-465/North Meridian Street interchange on the southwest side
of the prestigious Carmel-Clay Township suburban area of Indianapolis.
Many of the potential uses do not appear to reflect an appropriate "image"
use for this location, while others do not appear feasible due to the
site's physical constraints including extensive frontage along abutting,
elevated Interstate 465, 120-foot high light standards brightly
illuminating the southwesterly portion of the property, poorly drained
Brookston soil types comprising the majority of the land, as well as the
established single family residential housing adjoining the subject proper-
ty to the north. Potential development alternatives including single fami-
- ly; multi-family; light industrial; and commercial uses including shopping
centers, hotels/motels, commercial retail/service and office development
have been evaluated. Three types of property uses are concluded to be ap-
propriate for the subject site:
1. "Garden" Style High Quality Multi-Family Development.
2. Mid- to High-Rise "Luxury" Hotel Development.
3. Mid- to High-Rise Class "A" Office Development.
The large site size precludes feasible development of the entire property
with a mid- to high-rise luxury hotel/motel development, thus, only a small
portion of the site is believed reasonably developed with such a use. In
evaluating low-rise multi-family development versus mid- to high-rise of-
fice development of the remainder of the property, high quality office and
potential hotel/motel development is believed to be in accord with current
and projected future land use trends along the Meridian corridor and such
development is believed to represent a far superior "image" use than would
garden style apartment developments at this prime location. Furthermore,
office development would enhance the community tax base and provide a su-
perior return to ownership to a greater degree than would a multi-family
apartment project.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT I-465 & MERIDIAN STREET PAGE 2 '9 I,
HAMILTON COUNTY, INDIANA I
The conclusion of office and potential hotel/motel development of the site
to be the most appropriate use of the property would necessitate a revision
of current zoning. The most appropriate zoning classification is believed
reflected by the B-6 zoning district classification which appears appropri-
ate considering the subject site's location adjoining U.S. 31 and Inter-
state 465, its resulting high commercial potential, and its accessibility
not only from U.S.31 but also from College Avenue and Pennsylvania Street.
The most appropriate use of the subject site is concluded to be a Class A
mid- to high-rise office development which might potentially incorporate a
"luxury" hotel/motel. Factors considered in the determination of the most
appropriate use of the subject site are summarized in the following analy-
sis.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT I-465 & MERIDIAN STREET PAGE 3
HAMILTON COUNTY, INDIANA
I
QUALIFICATIONS
OF
RICHARD E. NICHOLS
MAI, SREA, ASA, SR/WA
EDUCATIONAL BACKGROUND
- M.S. Degree, Purdue University
- B.S. Degree, University of Illinois
- Real Estate Appraisal Examinations Nos. 1, 2, 3, 12, 14, and 16; American
Institute of Real Estate Appraisers
-
Appraisal Principles and Techniques, Apartment Appraisal Course, Special
Application of Statistical Analysis; Society of Real Estate Appraisers
- Rural Appraisal Course; American Society of Farm Managers and Rural
Appraisers
111
- Real Estate Principles and Real Estate Law; Indiana University,
Indianapolis Campus
Basic Commercial and Investment Course, Commercial and Investment Course
I, Investment Property Exchange and Taxation Course I; National Institute
of Real Estate Brokers
Courses 226 and 228, Lincoln Institute of Land Policy.
- Federal Home Loan Bank Board Seminars sponsored by Society of Real Estate
Appraisers; Memorandum R-41b (1985) and Memorandum R-41c (1986)
PROFESSIONAL EXPERIENCE
PI
- Appraiser Trainee, Staff Appraiser, Review Appraiser, Assistant Chief
Appraiser for the Indiana State Highway Commission.
- Independent Fee Appraiser since 1965.
f• - Representative clients have included individuals, attorneys, corporations,
banks, lending institutions, mortgage bankers, Illinois, Indiana, Michigan
Highway Departments, Urban Renewal agencies, redevelopment and public
housing authorities, U. S. Army Corps of Engineers, National Park Service,
Indiana Attorney General, Indiana Department of Natural Resources.
Pr - Types of properties appraised include residential, commercial, industrial,
rural and special purpose.
- Court testimony on numerous occasions in fourteen Counties in Indiana,
twenty in Illinois, fourteen in Wisconsin and Federal Court in Indiana.
- Have participated in real estate development, brokerage, syndication,
counseling and property management.
TEACHING EXPERIENCE
- Appraisal of Real Estate, Indiana University Extension; Real Estate
Investment, Indiana-Purdue, Indianapolis Campus; Indiana Real Estate
Salesmen's Course, Indiana University; Course 101, 201 and Narrative
Report Writing Seminars, Society of Real Estate Appraisers; Instructor of
Farm Appraisal Course at Purdue University in West Lafayette; Qualified
Instructor, Memorandum R-41c; plus participation in various professional
seminars.
MEMBER
- American Institute of Real Estate Appraisers (MAI); Senior Real Estate
Analyst Appraiser (SREA), Society of Real Estate Appraisers; Senior Member
American Society of Appraisers (ASA); Senior Member American Right-of-Way
Association (SR/WA); Member, Real Estate Counseling Group of America,
Inc.; Associate Member of Indiana Society of Farm Managers and Rural
o w Appraisers; Member, Metropolitan Indianapolis Board of REALTORS and
Indiana Association of REALTORS, The REALTORS Association of the National
Association of Brokers, The Urban Land Institute and member Rotary Club
International.
- Licensed Real Estate Broker in Indiana and Illinois.
OFFICES AND COMMITTEES
- Past President Indiana Chapter 27 American Institute of Real Estate
Appraisers, Past Member National Certification and Professional
Recognition Committee, AIREA.
- Past President Central Indiana Chapter 5 Society of Real Estate
Appraisers, past Chairman National Education Committee, past Governor
District 24 and member Executive Committee, past Vice President for
Education Sector, past Vice President for Administration Sector, past
President-Elect, past President of the International Society of Real
Estate Appraisers, and member of the Public Affairs Committee.
- Past Director, Indiana Chapter American Society of Appraisers.
- Past Treasurer, Metropolitan Indianapolis Board of REALTORS.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT I-465 & MERIDIAN STREET PAGE 4 � ''
HAMILTON COUNTY, INDIANA I
COMMUNITY ANALYSIS
The subject property is located on the southwest side of the city of
Carmel, in the southwestern quarter of Clay Township, Hamilton County,
'- Indiana. Hamilton County is the northernmost county included in the eight
counties comprising the Indianapolis Metropolitan Statistical Area (MSA).
The city of Carmel is located immediately north of 1-465 (the
circumferential freeway serving the city of Indianapolis) and is addition-
ally served by U.S. 31, a major north/south highway extending across the
state; State Highway 431, a north/south highway; and State Highway 234,
which extends through Carmel in an east/west direction.
The past two decades reflect a tremendous influx of higher-income families
into the southern portion of Hamilton County, most notably in or near the
city of Carmel. This influx is reflected in both population figures and
mean income rates of growth. The following table is an analysis of popula-
tion growth within the Indianapolis MSA by county and further indicates a
breakdown of the Clay Township and City of Carmel civil units within south-
ern Hamilton County.
-- POPULATION GROWTH--INDIANAPOLIS MSA BY COUNTY
--1960 through 1980--
Census Years 1960 1970 % Change 1980 % Change
(1960-70) (1970-80)
Total MSA 944,475 1,111,173 17.6% 1,166,929 5.0%
Counties:
Marion 697,567 792,299 13.6 765,233 - 3.4
Boone 27,543 30,870 12.1 36,446 18.1
Hancock 20,665 35,096 69.8 43,939 25.2
Hendricks 40,896 53,974 32.0 69,804 29.3
Johnson 43,704 61,138 39.9 77,240 26.3
Morgan 33,874 44,176 30.4 51,999 17.7
Shelby 34,093 37,797 10.9 39,887 5.5
HAMILTON 40,132 54,532 35.9 82,382 51.1
CLAY TOWNSHIP 10,215 19,518 91.1 32,795 68.0
_ (Includes Carmel)
CITY OF CARMEL 1,442 6,578 356.2 18,272 177.8
(Source: U.S. Bureau of Census)
Hamilton County has clearly sustained the largest rate of growth between
1970 and 1980 and one of the highest rates of growth during the 1960's.
The extraordinary growth of Hamilton County has occurred primarily in Clay
Township, which is the southwesternmost township and the location of the
city of Carmel. Carmel's growth is directly attributable to its location
as a suburban community at the northern edge of Indianapolis and community
leaders' efforts to maintain high quality services. The movement to this
area has been heightened by the excellent reputation of its school systems
and high quality residential subdivisions and has been facilitated by an
excellent street and highway system connecting Carmel with the Indianapolis
metropolitan area.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT I-465 & MERIDIAN STREET PAGE 5 414
HAMILTON COUNTY, INDIANA
Further insight into the affluence of Hamilton County's population is pro-
vided by analysis of average household effective buying incomes as dis-
played on the following chart:
AVERAGE HOUSEHOLD EFFECTIVE BUYING INCOMES
HAMILTON COUNTY, MARION COUNTY AND INDIANAPOLIS MSA
--12/31/85 AND 12/31/90--
AS COMPARED WITH THE UNITED STATES AND THE STATE OF INDIANA
12/31/85 12/31/90 Z Change
Hamilton County $37,985 $52,948 +63.1%
Marion County 32,344 50,049 +52.2
Indianapolis MSA 32,561 48,701 +52.7
Indiana 29,681 43,086 +47.4
United States 31,674 44,592 +49.5
SOURCE: Sales & Marketing Management's "Survey of Buying Power,
Part II," October 1986
As shown by the foregoing chart, Hamilton County evidences the highest av-
- erage household effective buying incomes within the Indianapolis MSA and is
decidedly superior in comparison to state and national averages. Estimates
through 1990 indicate that Hamilton County will retain its comparative po-
sition in the near future.
As the city of Carmel and the surrounding area continue to increase rapidly
in population, and as a large complement of high-income families moves into
this area, many commercial ventures have been locally established. U.S.
Highway 31 forms the major north-south traffic artery and property fronting
on U.S. 31 has been planned as a "commercial corridor," conducive to com-
mercial development, particularly high-rise office use. The intersection
of U.S. 31 with 116th Street has become, in recent years, the site of a
substantial amount of both general office buildings as well as corporate
headquarter office development. Corporations establishing headquarters in
this area desire an "image" location gained through proximity to the city
of Indianapolis in the prestigious Carmel area. These include
Hewlett-Packard, Delta Faucet, and Indiana Farmer's Mutual Insurance Compa-
ny, all situated on U.S. 31 between 106th Street and 116th Street. General
office developments along U.S. 31 include the Meridian Mark Office Complex
at the northeast corner of 116th Street, the Meridian on the Green Office
Complex at the southeast corner of 103rd Street, Fidelity Bank Plaza at the
-- southwest corner of 116th Street, Penn Mark Plaza at the southeast corner
of 116th, and the currently developing Meridian Technology Center (which
also includes industrial uses) at 116th and Pennsylvania Streets. Addi-
tionally, the northwest quadrant of 1-465 and U.S. 31 has been recently
rezoned for mixed use commercial development and all indications suggest
the Meridian Corridor will continue to develop with high quality commercial
uses.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 6
HAMILTON COUNTY, INDIANA I '
SITE CHARACTERISTICS
The subject site is situated at the northeast corner of the intersection of
North Meridian Street (U.S. 31) and Interstate 465 on the southwest side of
the rapidly growing community of Carmel. Containing about 70 gross acres,
the site is irregular in shape but has approximately 3,200 feet of frontage
along Interstate 465, 500 feet of frontage on North Meridian Street, as
well as approximately 900 feet of frontage on College Avenue. Although
Interstate 465 is a limited access multi-lane divided highway, access char-
acteristics provided by both Meridian Street (a four-lane divided highway)
as well as College Avenue (a four-lane undivided major north-south tho-
- roughfare) are good. Additionally, Pennsylvania Street, a secondary
north-south traffic facility in this area, is presently being extended to
the far northwest portion of the subject site.
According to available topographic maps, the site has a generally level to
gently rolling topography ranging from approximately 830 to 845 feet above
sea level. Presently, the tract is predominantly heavily wooded with ma-
- ture trees generally reflecting heights above 20 feet. Examination of the
Federal Emergency Management Agency's Flood Hazard Maps indicates no por-
tion of the property to be situated within a designated 100-year flood
plain; however, the site is bisected in a northwest-southeast direction by
an intermittent drainageway. According to the Soil Survey of Hamilton
County, Indiana, prepared by the United States Department of Agricul-
ture--Soil Conservation Service, soil types comprising the subject site
consist of approximately 30% Crosby silt loam and 70% Brookston silty clay
loam. These soil types are ubiquitous within both Hamilton and Marion
Counties and present no substantial obstacle to urban development with
proper site engineering; however, Brookston silty clay loam is a naturally
poorly drained soil and does generally require significant site preparation
to alleviate drainage problems.
SURROUNDING LAND USE
Surrounding development presently consists of an automobile dealership
north of the subject on U.S. 31 and single family residential uses to the
north and east (across College Avenue) from the subject. The residential
_ developments are generally comprised of single family dwellings constructed
during the 1950's and 1960's. Examination of recent listings and sales of
properties in this area indicates values generally ranging between $60,000
and $90,000.
The site is bound to the west by Meridian Street (U.S. 31) which is the
original north-south highway serving the state of Indiana, and serves as
the base line from which all east and west street numbers originate in the
Indianapolis metropolitan area. Meridian Street is perhaps the best known
and most prestigious traffic artery in the Indianapolis metropolitan area
as this thoroughfare was originally developed in Marion County with some of
the largest and most luxurious residences which were occupied by the most
prominent citizens during the early formative years of the city of
Indianapolis.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 7 '� t
HAMILTON COUNTY, INDIANA I I
Across Meridian Street from the subject is currently vacant land which has
been recently rezoned for mixed use commercial development inclusive of
multi-story office and hotel proposed uses. South of the subject is Inter-
state 465, the circumferential highway serving the city of Indianapolis.
This extremely heavily traveled thoroughfare is generally level with, or
elevated approximately 5 to 10 feet above, the subject site but rises to
elevations of up to 35 feet above the subject at the interchange with
Meridian Street and is also 15 to 20 feet above the subject at the College
Avenue overpass. Across Interstate 465 from the subject property is pre-
dominantly vacant land which is reportedly being considered for development
with commercial office and retail structures by a major local developer.
The interchange of I-465 and North Meridian Street serves as the main arte-
rial intersection of the North Meridian commercial corridor and is brightly
illuminated by 120-foot high light standards. According to the Indiana De-
partment of Highways, the most recent traffic counts (1984 for Marion Coun-
ty and 1985 for Hamilton County) for these major traffic arteries abutting
the subject property are as follows:
Average Annual
Daily Traffic Count
Meridian Street
96th Street to Interstate 465 31,300
Interstate 465 to 116th Street 30,600
Interstate 465
U.S.421 to Meridian Street 57,450
Meridian Street to U.S.431 57,030
The traffic volumes of these highways are undoubtedly increasing as a re-
... sult of the population growth of Carmel and Hamilton County and particular-
ly the commercial development along the Meridian Corridor. Although rumors
have been generated as to revision of the current interchange configuration
_ to help alleviate traffic congestion, such does not appear probable in the
near future.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT I-465 & MERIDIAN STREET PAGE 8
HAMILTON COUNTY, INDIANA I '
SUMMARY OF PHYSICAL AND LOCATIONAL ATTRIBUTES
The physical and locational characteristics of the subject property are
summarized as follows:
1. General Location: Excellent--Carmel and Clay Township are regarded
as having one of the finest school systems and contain some of the
highest quality residential subdivisions and commercial office devel-
opment within the Indianapolis metropolitan statistical area.
2. Specific Location: Excellent--interchange of North Meridian Street
and Interstate 465 is one of the most readily recognized locations
within the Indianapolis MSA, serving as the arterial focal point of
the North Meridian commercial corridor.
3. General Site Characteristics: Good overall site size of approximate-
ly 70 acres. Configuration irregular with overall east-west depth to
north-south width ratio estimated at approximately 5:1. Topography
generally level to gently rolling and tract is predominantly wooded.
Access characteristics very good with potential access from North
Meridian Street, Pennsylvania Street, and College Avenue.
4. Specific Site Constraints: Interstate 465 forms south boundary of
subject site and abutting highway grade is up to 35 feet above sub-
ject's ground elevation. Southwest portion of site is brightly
illuminated by 120-foot high lighting standards at 1-465 and Meridian
Street interchange. While the ample exposure of the property would
typically be positive for commercial development; traffic noise and
lack of privacy, combined with portions of the adjoining highway be-
ing elevated are not conducive to residential use. Furthermore,
poorly drained Brookston soils comprise approximately 70% of site and
will require extensive development planning and engineering to alle-
- viate potential drainage problems.
PROBABLE USE ANALYSIS
While the commercially developing nature of the Meridian corridor immedi-
ately suggests similar commercial utilization of the subject site, alterna-
-
tive uses must necessarily be considered. In order to establish reasonable
potential uses for the subject site, land uses at all other Interstate 465
interchanges have been identified as summarized on the following table:
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 9 � I,
_ HAMILTON COUNTY, INDIANA I
INTERCHANGE NORTHEAST QUADRANT SOUTHEAST QUADRANT SOUTHWEST QUADRANT NORTHWEST QUADRANT
1-465 6 Meridian Street Subject Property Vacant (Proposed Vacant (Proposed Church/Vacant (Proposed
Commercial Development) Commercial Development) Commercial Development)
1-465 & Keystone Avenue Commercial Retail/Service Keystone at the Crossing Church/Vacant Commercial Retail/Service
Commercial Development
I-465 & Allisonville Road Shopping Center Shopping Center Motel/Restaurants Commercial Retail/Apts.
1-465 & 1-69 Condo./Lt. Industrial Office Development Apts./Lt.Industrial Lt. Industrial/Offices
I-465 & East 56th Street Apartments Apartments Apartments Apartments
I-465 & Pendleton Pike Motel/Commercial Motel Single-Family Single-Family
Service
I-465 & I-70 Single-Family Single-Family Motels/Restaurants Industrial
I-465 & Brookville Road Single-Family Agricultural Vacant (Floodway) Single-Family/
Commercial
1-465 & I-74 Industrial Agricultural Agricultural Agricultural
I-465 & I-65 Apartments Apartments Single-Family Apartments
I-465 & Emerson Avenue Motels/Commercial Motel/Restaurants Motel/Restaurants Single-Family
Service
1-465 & East Street Mini-Warehouse Motels/Commercial Restaurant, Motels/ Shopping Center
Service Single Family
I-465 & State Road 37 Truck Stop/Motel Industrial Vacant/Industrial Truck Stop
1-465 & 1-70 Park Fletcher Single-Family/Vacant Single-Family Airport
Industrial Development
I-465 & Kentucky Ave. (SR 67) Single-Family Single-Family Commercial Service Industrial
I-465 6 Washington Street Apts./Commercial Commercial Service/ Commercial Service/ Shopping Center
Service Single-Family Single-Family
1-465 & Airport Expressway Park Fletcher Park Fletcher Motels Airport
Industrial Development Commercial Development
I-465 & 10th Street Single-Family Hospital Office Single-Family
1-465 6 Rockville Road Apts./Shopping Center Single-Family Apts./Restaurant Single-Family
1-465 & 38th Street Shopping Center/ Motel/Restaurant Vacant (Proposed Commercial
Commercial Commercial Development)
I-465 & I-74 Motel/Apartments Motel/Apartments Office/Motel Vacant
1-465 6 1-65 Single-Family Single-Family/Vacant Eagle Creek Park Eagle Creek Park
I-465 & 71st Street Retail Service/ Office/Commercial Vacant (Proposed Agricultural
Commercial Commercial Development)
1-465 & 86th Street Commercial Service Park 100 Commercial/ Single-Family Single-Family
Industrial (Undeveloped) (Undeveloped)
I-465 & Michigan Road Motels Motel/Restaurant Motels Vacant/Lt. Industrial
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 10 £`
A:
HAMILTON COUNTY, INDIANA
Analysis of the existing land uses at other Interstate 465 interchange lo-
-
cations in Indianapolis indicates a variety of residential, commercial, and
industrial developments. Each of these potential uses of the subject site
are discussed in relation to the subject property's physical and locational
attributes as follows:
Single Family Development
The single family developments identified as being situated at various
Interstate 465 interchanges virtually all consist of relatively high densi-
ty "tract" style developments containing dwellings which were generally
constructed during the 1950's and 1960's and which reflect minimum standard
construction quality and materials. These developments are generally occu-
pied by low to middle income "blue collar" residents and the developments
are generally devoid of aesthetic amenities such as ponds/lakes and/or un-
_
developed wooded or open "green" areas. Important to note is that all of
these developments were in place at the time of construction of Interstate
465 and that no single family residential development at an interchange lo-
cation is known to have occurred since the completion of this
circumferential beltway.
_ Recognizing that the predominant portion of the subject site (all of the
land east of a point 600 feet east of Meridian Street) is currently zoned
S-2 Residence District (Low Density Single Family Development) and that the
site was, in fact, platted into small single family lots, residential de-
-- velopment of the subject site must necessarily be considered. However, the
type of residential development reflected at other Interstate 465 inter-
change locations would not appear to be an appropriate use of the subject
site given the property's prestigious location at an extremely
well-recognized intersection of two of the most prominent roadways serving
the northerly portion of the Indianapolis metropolitan area. It is doubt-
ful that the community of Carmel, which is well known for high quality res-
" idential development, would be desirous of minimum standard residential
construction at this heavily traveled intersection.
Similarly, while mobile home development appears physically feasible, such
developments do not convey a high quality community image. The financial
feasibility of mobile homes or moderate cost single family dwelling devel-
opments also appears questionable as neither Carmel nor the northern por-
n on of Indianapolis contain a substantial number of "blue collar" employ-
ment opportunities which might be expected to be attracted to such a devel-
opment. Furthermore, the poorly drained Brookston soil types comprising
the majority of the site are projected to necessitate substantial develop-
ment planning and engineering inclusive of one or more retention ponds to
insure adequate surface and internal drainage. Combining the probable site
engineering which would be required with the extremely high land values
created by the strong level of developer demand for land in the Carmel com-
munity substantially reduces the economic viability of relatively low cost
single family dwelling or mobile home park housing in this location. Fi-
- pally, it is doubtful that surrounding residential development would be
amenable to such utilization of the subject site as housing of inferior
quality could lower residential property values of existing, nearby resi-
dential properties.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 11 40 ,
HAMILTON COUNTY, INDIANA '
As high density, low to moderate priced housing does not appear to be a
reasonable or desirable use of the site, alternative single family residen-
tial development potential use is considered.
Although high quality, low density development should be acceptable to both
the community-at-large and the adjoining residential development in partic-
ular; the presence of Interstate 465 is believed to negate the possibility
_ of successful development. High quality "luxury" residential dwellings are
not typically situated along the interstate system serving Indianapolis and
certainly not at any of the interchange locations of Interstate 465. Such
developments require privacy and exclusivity and the subject site's large
and narrow configuration with 3,200 feet of frontage along an elevated
interstate highway precludes successful creation of these necessary ameni-
ties. While more median priced subdivisions are found to be sporadically
located adjoining the interstate, such developments typically do not re-
_
flect a substantial amount of frontage along the interstate, nor is the
interstate generally elevated to any significant degree at these locations,
thus, through utilization of earth mounds, trees, and privacy fencing, the
detrimental impact of the heavily traveled adjoining highway is generally
minimized. Such would not be economically feasible as regards the subject
site due to the extensive amount of highway road frontage. Furthermore,
Interstate 465 is elevated approximately 20 to 35 feet above the subject at
the east and west ends of the property and 120-foot high light standards
are located at the I-465/U.S. 31 interchange. As such, it would appear un-
likely that median or high priced single family dwellings would be saleable
at this location and, therefore, such is not considered to represent a
probable or financially feasible use.
_ Multi-Family Development
Various interchange locations of the Interstate 465 "beltway" reflect mul-
ti-family development. With the exception of one condominium community
situated at the intersection of Interstates 69 and 465, the remainder of
these multi-family developments consist of apartment projects. The condo-
minium development is of modular construction and has had an extremely
troubled operational history since its inception, the majority of units be-
ing rented when lack of demand for ownership became apparent. As noted
within the discussion of potential single family development, the highly
recognized interchange location and the subject site's ample exposure along
Interstate 465, as well as the existing single family residential base to
the north and northeast, would not indicate a low to moderate quality mul-
ti-family condominium usage to be acceptable from a community or adjoining
land owner viewpoint. Also as noted within the discussion of potential
single family use, median to high priced condominium development would not
appear probable due to the elevated nature of the interstate highway and
the extreme high volume of traffic and resulting vehicular noise which
would generally be perceived as adverse to middle to high income property
owners.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 12 41 I'
HAMILTON COUNTY, INDIANA '
Multi-family apartment development upon the subject site does appear viable
as several of the apartment projects identified at other Interstate 465 in-
terchange locations have been developed since the interstate's construction
and are apparently economically viable. However, lower quality mul-
- ti-family apartments do not appear appropriate due to the site's ample ex-
posure/visibility and the property's I-465/U.S. 31 "image" location as re-
gards the Carmel community. Lower quality multi-family apartments would
also not appear cohesive with the existing adjoining single family develop-
- ment. Although mid-quality multi-family apartment construction would also
not appear appropriate due to the "image" location and might also be found
objectionable by adjoining single family owners, high quality "luxury"
apartment construction might well be considered to reflect an appropriate
image for the community. Such should not be highly objectionable to ad-
joining single family ownerships, assuming proper site planning and engin-
eering which would logically include the northerly property line of the
site being left relatively densely wooded to provide a buffer from the ad-
joining single family residences. High quality, adults only apartments
have been successfully developed in the northwest quadrant of 1-465 and
Allisonville Road indicating higher income, non-family renters do not find
proximity of interstate highways to be as objectionable as do higher income
family renters or property owners. However, important to note is that no
truly viable high-rise apartments have been developed in suburban locations
in the Indianapolis metropolitan area and, therefore, a luxury multi-family
apartment project on the subject site would most likely consist of a two-
or three-story "garden" style development. Density of such developments in
the Indianapolis MSA generally range between 10 and 15 units per gross acre
and unit sizes typically average 800 to 900 square feet. Although such de-
velopment would not truly take advantage of the site's highly visible loca-
tion and would therefore not maximize the community's positive image to
traffic on the abutting highways, such is believed to be a feasible use of
the site, although the long, relatively narrow axis of the site parallel
with the interstate renders amenity creation difficult.
Industrial Development
A wide variety of industrial uses are identified at various Interstate 465
interchange locations around Indianapolis. Although the subject site's
characteristics appear readily conducive for industrial use, industrial de-
velopment is not considered compatible with the perceived "image" location
'- of the subject property, nor is industrial development believed harmonious
with the adjoining single family residential dwellings. Although high
quality quasi-commercial/industrial type uses such as "Type I" of-
_ rice/warehouse structures might be considered visually acceptable and rea-
sonably compatible with appropriate site perimeter screening, such uses
typically generate a substantial volume of truck traffic which is believed
detrimental to the character of the surrounding area. As such, industrial
use is not believed to reflect an appropriate use from a community stand-
point.
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 13
HAMILTON COUNTY, INDIANA I '
Commercial Development
The majority of the Interstate 465 interchange locations within the
Indianapolis MSA have been developed with commercial uses including office
developments, shopping centers, and general retail/service uses inclusive
of motels, restaurants, free standing retail establishments, etc. Commer-
cial development would directly benefit from the site's abundant Interstate
465 exposure, however, shopping center and general service/retail type de-
velopments are typically one-story in height in suburban locations in
Indianapolis. Therefore, such uses do not generally provide high visibili-
ty identity without utilization of highly elevated, lighted signage. Ele-
vated lighted signage is not typically perceived as reflecting high quality
development as such identification signs are generally associated with
"truck stop" type developments and/or gasoline service stations, fast food
— restaurants, and transient roadside motel type uses; none of which are be-
lieved to reflect an appropriate "image" for this location. Furthermore,
although retail development could be reasonably effectively screened from
adjoining residential land uses through incorporation of an undeveloped
buffer strip along the north property line of the subject site, elevated
lighted signage might be considered objectionable to surrounding residences
and retail development tends to generate the highest traffic volume of any
type of potential use. Considering the site's configuration, such could
create extreme traffic congestion at the three identified access points.
Motel development is observed at many of the Interstate 465 interchanges.
Although the majority of these facilities tend to be low rise "budget" or
"economy" type facilities, and such are not envisioned as being appropriate
at the subject location, the marketplace does exhibit successful mid- to
high-rise "luxury" hotel/motel interchange developments and such would be
compatible with the perceived "image" location of the subject property.
However, such developments typically require site areas of less than 10
acres and the subject's site area of 70 acres would therefore require ac-
- companying development in addition to "luxury" hotel/motel construction.
The most probable co-existive use is considered to be mid- to high-rise
"Class A" office development. Good quality multi-story office buildings
would be highly visible from Interstate 465 and should provide a positive
community image to the interstate traveler. Mid- to high-rise office de-
velopment would also certainly be in conformity with current and future
planned development along the Meridian corridor. Finally, multi-story of-
fice construction would also allow for substantial portions of the site to
remain naturally wooded or as "green" open areas, as well as a wide, wooded
buffer strip along the north property line in order to buffer the adjoining
single family residences to the north form potential development. There-
fore, no measurable surrounding property value diminution is projected to
result. Incorporation of a wooded buffer strip along the north property
line should reasonably segregate the different property uses both physical-
ly and visually. Furthermore, it is noted that values and marketability of
single family property values in the Northern Heights development on 116th
Street just east of U.S. 31 have reportedly not suffered despite the sub-
stantial mid- and high-rise office development at the U.S. 31/116th Street
intersection.
MOST APPROPRIATE USE EVALUATION PAGE 14 't
NE QUADRANT I-465 & MERIDIAN STREET 'I '
HAMILTON COUNTY, INDIANA
MOST APPROPRIATE USE ALTERNATIVES/TRAFFIC ANALYSIS
After analyzing potential development alternatives including single family;
multi-family; light industrial; and commercial uses including shopping cen-
_ ters, hotels/motels, commercial retail/service and office development;
three types of property use are concluded to be appropriate for the subject
site. These three perceived appropriate uses are enumerated as follows:
1. "Garden" Style High Quality Multi-Family Development.
2. Mid- to High-Rise "Luxury" Hotel Development.
3. Mid- to High-Rise Class "A" Office Development.
While mid- to high-rise luxury hotel/motel development is perceived to be
appropriate, the site size of approximately 70 acres precludes feasible de-
velopment of the entire property with such a use, thus, only a small por-
-
tion of the site (most likely the actual interchange location of 1-465 and
U.S. 31) is believed reasonably developed with such a use.
In evaluating low-rise multi-family development versus mid- to high-rise
office development of the remainder of the subject property, consideration
is given to the amount of traffic which would be generated by such uses.
According to the Institute of Transportation Engineers Information Report--
"Trip Generation" Third Edition, 1982--low-rise apartments generate an av-
erage daily trip rate (weighted average of the number of trips entering
plus all trips leaving) of 6.6 trips per unit.
Assuming a typical development density of 10 to 15 units per gross acre,
say 12.5 units per gross acre, indicates 875 potential units. At an aver-
age daily trip rate of 6.6 per unit, the resulting daily vehicular trips is
computed at 5,775. Comparatively, general office use is indicated to gen-
erate 12.3 trips per 1,000 square feet of gross leasable area. An office
development of similar size as the hypothetical multi-family development
(assuming 850 square foot average multi-family unit size) would result in a
total project size of 743,750 square feet. Application of an average daily
rate of 12.3 trips per 1,000 square feet of gross leasable area results in
9,148 projected daily trips. In order for the comparison to have validity,
it must be recognized that traffic volume for apartment usage extends
throughout the week while traffic volume for office usage is virtually all
concentrated during a five day week. Application of the apartment daily
-- rate to a seven day week results in a weekly volume of 40,425 in comparison
to a five day week volume for office usage of 45,740. Although office de-
velopment is indicated to generate a somewhat higher volume of traffic than
would a luxury multi-family apartment project, adjoining residential owners
r-
might find concentrated traffic during the work week to be preferable to
increased traffic on weekends when owners would typically be desirous of
quiet enjoyment of their properties.
I
I
PR MOST APPROPRIATE USE EVALUATION PAGE 15
NE QUADRANT 1-465 & MERIDIAN STREET fI ''
HAMILTON COUNTY, INDIANA
1
MOST APPROPRIATE USE CONCLUSION
The most appropriate use of the subject site is believed to be represented
by a Class A mid- to high-rise office development which might potentially
incorporate a "luxury" hotel/motel. High quality office and potential ho-
tel/motel development is believed to be in accord with current and project-
ed future land use trends along the Meridian corridor and such development
is believed to represent a far superior "image" use than would garden style
apartment developments at this prime location. Furthermore, office devel-
opment would provide a greater return to ownership and also enhance the
community's tax base to a much greater degree than would a multi-family
apartment project. Recognizing that most appropriate use as previously de-
fined includes consideration of the contribution a specific use will have
to community environment or community development goals, office and possi-
ble hotel/motel use is believed to most appropriately reflect the most ap-
propriate use of the subject property.
The conclusion of office and potential hotel/motel development of the site
to be the most appropriate use of the property would necessitate the prop-
erty's current zoning be revised. It is believed an appropriate zoning
classification for the subject site would be reflected by the B-6 zoning
_ district classification as defined within the Zoning and Subdivision Con-
trol Ordinance: City of Carmel, Indiana; Ordinance No. 2-160; January 21,
1980. The B-6 zoning district is established "to provide a location for
light commercial and office uses adjacent to limited access highways. The
intent is to permit these uses to develop in an area of high commercial po-
tential utilizing access roads and existing secondary streets and roads
buffering surrounding residential uses."
The B-6 classification appears appropriate for the subject property consid-
ering its location adjoining U.S.31 and Interstate 465, its resulting high
commercial potential, and its accessibility not only from U.S.31 but also
'- from College Avenue and Pennsylvania Street.
`� Thank you for this opportunity to be of service. Should you have any ques-
tions or require additional information pursuant to this analysis, please
so advise.
Sincerely,
RICHARD E. NICHOLS ASSOCIATES, INC.
itr
fwd ` W
Richard E. Nichols
MAI, SREA, ASA, SR/WA
REN:ss
Our Ref. #8781
I
PI
t
MOST APPROPRIATE USE EVALUATION
NE QUADRANT 1-465 & MERIDIAN STREET PAGE 16
HAMILTON COUNTY, INDIANA
CERTIFICATION
I, Richard E. Nichols, certify that, to the best of my knowledge and be-
lief. . .
the statements of fact contained in this letter analysis are true and
correct.
-- - the reported analyses, opinions, and conclusions are limited only y
the reported assumptions and limiting conditions, and are my person-
al, unbiased professional analyses, opinions, and conclusions.
I have no present or prospective interest in the property that is the
subject of this letter analysis, and I have no personal interest or
bias with respect to the parties involved.
- my compensation is not contingent on .an action or event resulting
from the analyses, opinions, or conclusions in, or the use of, this
letter analysis.
- my analyses, opinions, and conclusions were developed, and this let-
ter analysis has been prepared, in conformity with the requirements
-' of the Code of Professional Ethics and the Standards of Professional
Practice of the American Institute of Real Estate Appraisers.
The use of this letter analysis is subject to the requirements of the
American Institute of Real Estate Appraisers relating to review by
its duly authorized representatives.
I am currently certified under the voluntary continuing education
program of the American Institute of Real Estate Appraisers. I am
also currently certified under the Society of Real Estate Appraisers
Continuing Education Program through December 15, 1990.
- I have made a personal inspection of the property that is the subject
of this letter analysis.
- Randy L. Weyland, SRPA, provided professional assistance to the un-
dersigned in developing this letter analysis.
I
4d4
Richard E. Nicho s
MAI, SREA, ASA, SR/WA
11 .
MOT APROPIATE ON
NES
QUADPRANTR1-465U&EMERIDIANISTREET PAGE 17
HAMILTON COUNTY, INDIANA I '
A
4.14 110111 &R,EA
SR1►
S#0 1111111ir
The international Society of Real Estate Appraisers
has authorized
RICHARD E. NICHOLS
to include the Senior Real Estate Analyst (SREA)
designation in his/her professional credentials through
December 15, 1990
Senior Real Estate Analysts (SREA) are pro- Certification procedures require a compre-
fessional members of the Society of Real Es- hensive oral examination by an examination
tate Appraisers who have extensive technical board of the Admissions Committee, inspec-
- training, long and varied experience, who tion of office operations, review of appraisal
have earned the respect of the community and analysis reports and a thorough investi-
and their peers for their expert knowledge, gation of the applicant's competence and
outstanding ability, professional leadership integrity. This investigation includes contact
— and integrity. with other SREA members, professional-ap-
praisers, clients, attorneys, judges, and per-
SREA members have demonstrated in prac- sons in the community.The SREA designation
tice that they are competent to appraise all is awarded for five years only.
types of real estate interests and ownerships
in accordance with accepted definitions of A member wishing to renew the SREA desig-
market value, and to extend appraisal analy- nation must apply for recertification at the end
sis beyond current market value to provide a of the five (5) year period. Upon application
basis for decision-making to clients response- for recertification, applicant is expected to
ble for committing funds or assets in the sale, show evidence of integrity, continued techni-
financing, purchase, lease, trade, renovation, cal training, experience, and professional
development, demolition or division of real leadership commensurate with current SREA
property. The analyst's experience encom- Admissions standards.
passes the most difficult appraisal problems.
CERTIFIED SREA 12/15/75 This authorization has been prepared for
CERTIFIED
12/15/80 inclusion in the certification section of the
12/15/85 appraisal/analysis report. Any questions re-
CERTIFIED garding this member's status should be di-
CERTIFIED rected to Headquarters office of the Society
of Real Estate Appraisers, 645 North Michi-
CERTIFIED gan,Chicago, Illinois 60611;(312)346-7422.
SAM POW SW nnw.
MOST APPROPRIATE USE EVALUATION 1
NE QUADRANT I-465 & MERIDIAN STREET PAGE 18 , ',
HAMILTON COUNTY, INDIANA