Good morning.

This is Clark County Board of Equalization hearing for February 9th, 2026.

County Clerk has informed us that the meeting has been posted and properly noticed.

At this time, can we please call the roll?

Terry Farr.

Present.

Luca Dommel.

Here.

Glenn Anderson.

Here.

Paul Chafee's absent today.

Heidi Madam Bauer.

Thank you.

That motion passes.

Before we start, the microphone is open for any public comment.

Seeing none, I will close the microphone.

We need to swear in the petitioners, anyone who intends to testify in behalf of the petitioners and members of the assessor's office, please stand and face the clowning clerk to be sworn in.

Do you solemnly swear that the testimony you're about to give during the course of this hearing is the truth, the whole truth, and nothing but the truth.

So help you go out.

Or they may raise or lower the value of the property that was used as the comparable property.

Under NRS 361.357, if a taxpayer believes the full cash value of their property is less than the assessed taxable value for the fiscal tax year being appealed, the board may review the assessor's determination.

If the board finds that the full cash value on the January 1st, prior to the fiscal year being appealed, is less than the taxable value, the board may correct the land value or fix a percentage of obsolescence that is to be deducted from the improvement value to ensure the total taxable value corresponds as closely as possible to its full cash value.

Under NRS 361.355, if a taxpayer believes their property is overvalued by reason of another property being undervalued or not assessed, the board may examine any evidence submitted and then make a determination.

If the board finds the property complained of is undervalued or not assessed, they may increase the taxable value or place the property on the tax roll at its taxable value.

A public officer must disclose potential conflicts in public to the chair and other members of the board.

If a public officer has a personal financial or private commitment that could reasonably affect their decision on an issue, they must publicly disclose this information to the chair and board before taking any action.

Additionally, the public officer must not vote on promote or participate in deliberations on an issue.

If a reasonable person would believe their judgment could be influenced by a gift or loan, a significant financial interest or a personal or private obligation to another party.

Thank you.

You will find that starting on page seven of the masterbook.

That motion passes.

Yes, Chairman Farrell, we do.

We have five notices of appearance today or seven.

Seven notice of appearances today.

I believe they're all the same issue.

Um just to um refresh the board's memory.

Um notice of appearances have to do with um either an untimely filing or someone who filed inappropriately, they didn't have the proper owner's signature to a file and appeal.

Um, I believe um Stephanie is going to present those cases today.

We've included the statutes and all of the case information to reference and she's gonna reference those for you.

So we're gonna turn it over to Stephanie Jones.

Thank you, Stephanie Jones with the Clark County Assessor's Office.

Um the notice of appearance cases, um, we can begin um with case 931.

Each of these cases are the same agent and have the same exact issues, so I can go through case 931 and then incorporate my testimony on the rest of it if that's okay.

Okay, I got it.

Okay, if you can go to page um two 2126, which is their appeal form.

I'm just gonna guide you through this a little bit.

Um you can see in part A, the owner is SFR fund five, I'm sorry, six borrower LLC.

Um if you scroll down a little bit to part C, it asks for the relationship of petitioner to the owner and nothing is checked there.

Um let's go down to the next page 2127.

You can see under the certification certification part G, there's no owner signature on the appeal form.

Um, down under Part H, which is the authorization of the agent, you can see that this is filled out.

Mercy Galindo and Mercy Galindo has signed the petition.

Um I can have you go to page 2136.

If a person files the appeal in a timely manner without the written authorization required by subsection one, the person may provide without written authorization within 48 hours after the last day allowed for filing the appeal.

This year that deadline was January 15th, which fell on a Thursday, so they had until the 17th to provide a letter of authorization.

We did not receive a letter of authorization.

On the 20th of January, we did send a letter to them letting them know that we did not, that this was an untimely filing.

Just for the board's information, we send out an email blast.

Yeah, you can see that on 2131.

This agent did receive that, letting them know the rules and when they would have to file the letter of authorization.

Also the instructions sent with the petition, which was sent to them on the 13th.

Let's them know the deadline for filing an aid agent authorization.

Again, that would have been the 17th of January.

And we did not receive this on time.

So we recommend the board does not take jurisdiction.

Based on the information provided in the testimony contained here in a motion that we deny jurisdiction over this case.

Please cast your votes.

That motion passes.

Okay, approve.

Um so I can read the cases 932, 933, 934, 935, 936, and 917.

Very good.

Did you want to introduce them or go through them or just you'd like for me to go through them?

I can.

It's the same issue.

Um so I can incorporate my testimony in all of those six cases.

Just to cover us is what I'm saying.

So the the testimony from case 931 is incorporated into cases 932, 933, 934, 935, 936, and 917.

Is that correct?

That is correct.

Thank you.

Based on the information provided, testimony contained herein.

I motion that we deny jurisdiction on cases 932, 933, 934, 935, 936, and 917.

Please cast your votes.

And that motion passes.

Um, your next item, um, item number nine request to add role property land or improvement value to the secured role pursuant to NRS 361.769 for prior tax shares not assessed.

This has to do with um items that were established escaping taxation where we did not have buildings or the land valued properly on the record.

Um, I will say we do have three of those for today's hearing.

However, one of them we are actually going to ask you to remove from the agenda for today.

We are going to renotice them.

We were having issues.

Uh, we've sent certified letters, two different certified letters, and they've both been returned.

We've not been able to get a hold of the property owner, so we're gonna try to make some other efforts to do that.

If we cannot, we will still come forward with it at another hearing at a later date.

Um, but that would be case 1136 puppy playhouse Craig Holdings LLC.

We're we're not gonna have you vote on that today.

We're just gonna have that excluded from the hearing today.

Um, but we can move forward with the other two, um, which I believe is case five uh 741 and case 598.

Both of those are that scenario.

So cases 741 and 598, we're just looking to uh add uh land or improvement value to the role based on the SS recommendation.

It's not an we are gonna go over those cases.

We'd like to go over those values with you and have you vote on us adding them to the role because it is not going to be for just one year in this instance, it's going to be for uh several years because they've been missing in what the statute permits us to do that up to three years, um, current plus three years.

And so I believe Jamie Jacobs has case um 741 and she can present that evidence, and then Stephanie has case uh 598, and she could present that evidence and you can vote on it accordingly.

Okay, so we're just calling case 741 right now.

Yes.

Okay, 741.

Thank you, Mr.

Chair Jamie Jacobs for the clerk on the assessment department.

This case 741 begins uh on page 19 of the addendum book.

And this petition is filed under NRS 361.769.

Uh the uh improvements were not placed on the roll when they were built.

So a portion of the improvements on this parcel.

Well, I can actually first direct you to page 23 that shows you the different values.

Um portion of the improvements on this parcel owned by Satteray Properties Group LLC has not been on the tax roll since 2022 slash 2023.

After an aerial discovery of the property in the fall of 2025, it was determined that the buildings and associated site improvements were constructed on this parcel but never added to the property tax role.

The property owners were notified of an improvement value that did not include the building and additional site improvements, and they were not taxed appropriately.

Since the building was in existence, our office has requested these values be placed on the tax roll for the fiscal years indicated above.

The building is a 3,260 square foot duplex residential structure with an attached garage located on the parcel at address 2127 Ellis Street, North Las Vegas.

The construction of the property of the duplex started in 2020.

I'll have you jump to page 39 of the addendum.

And so what initially when I initially petitioned the board for these values, I was just using replacement cost new, less depreciation, of course, they're fairly new, uh, plus the market value for the land.

And then while I was preparing the case, I went through and did a comparable sales analysis on the property for the various years to see if the improvements the cost approach was uh good indication of value, and based on the market, it looks like it was high.

So on page that I just referred you to page 39.

So I pulled some sales in the area of duplexes, and it's in an older neighborhood, so a couple of issues with the property.

It's a large duplex, meaning it's a three-bedroom, two-bath duplex on each side, which is not really typical for the area.

A lot of times you find either a one or two bedroom duplex and certainly not an attached garage because the garage, each unit has its own garage that has access inside the garage.

And so that's kind of what I'm feeling is like it's a little bit overbuilt for the area and and suffers from some functional obsolescence because of that, as well as having that garage.

Um, so at the bottom of the grid, I I put three uh current listings at the time.

Actually, two of them are under contract, and this is kind of looking outside of it, so I didn't put any weight on it, but I just wanted to show something in the area that was new that had sold, and were duplexes.

And so you can see there the first the this uh number seven, eight, and nine uh were listed for 530, and I just closed on Friday on the 6th, February 6th of this year, and they did close at their their list price of 530,000, uh number seven and and eight.

Number nine is still listed, and and it's not on not under contract.

So that kind of gives me an indication.

Okay, 530 is for a there's definitely a smaller duplex, you know, about half the size, you know, brand new in the area.

These are a couple miles away, and so it that kind of gives me an indication of maybe you know what a new one would be.

Again, these are smaller, so I do would make an adjustments for for size and that kind of thing, and the and the attached garage, good contributory value.

But basically, I put the weight on the older ones that are in the area.

There was one 1981, first comp there, and so the median is around I conclude to a value of 575,000, and then I subtracted the land to come up with a percentage of obsolescence that I could apply the improvements, and so that's kind of like the the most recent date we're looking for to add, and then on page 27 is the first year of 2022-2023 that we're asking.

So it kind of let's kind of set the range of where the prices are here.

And so these comparables again, older.

There was one built in 2003, kind of give an immediate indication of around 509,000.

So again, subtract the land value to come up with a percentage difference between what our cost approach is and what these market value for the improvements would be, and then the two years in between, and I kind of average median or averaged it out to about 15% functional obsolescence to apply to the cost approach, and I did that for each year, and the I included the property record cards.

So on page 42 on the right hand column below the basic improvements because this is kind of a summary of the cost, and you can see under multiple adjustments the 15%.

And you can see under multiple adjustments the 15%.

So I did apply the 15% to the main structure as well as the site improvements.

Get that applied as well.

So I did that for all three years, and that's how I established what the taxable values would be.

And you can again find that on page 23.

So the different the four years current that was billed plus three back.

And so for the 2223 tax year, we're requesting that the board add the approving value for a taxable value of 384,461.

For the 2324 tax year, the improvements being added at a taxable value of 407,148.

The 2425 tax year, the improvement value, taxable value to be added, 435,000.

And then the final one, 2526 for the uh taxable value of the approvements to be added, 453,551.

And I can answer any questions you'd like.

I'm guessing the property owner is not here since nobody has stepped up.

Yeah, so we did send out certified letters, and that is on page 44, showing the uh receipt of our certified letter.

And I did receive a call from Odell, who uh is a personal assistant to the owner, and to kind of because she was wondering what was all about, and the owner was as well.

So I explained the process what we were doing, and she was gonna basically pass along my information to the owner if that way if they had any questions, they could call me and and I never did receive a call.

Members of the board, any discussion based on the information provided and testimony contained herein on case 741.

I motion that we accept the assessor's recommendation.

Please cast your votes.

That motion passes.

Uh next one's 598.

Thank you.

Um, Stephanie Jones for the Clark County Assessor's Office.

Uh, case 598 begins on page 1842.

Um, this is escaping taxation for fiscal years 2024-2025 and 2025-2026.

Uh, the subject is a 12.59 acre vacant land parcel located near I-11 and Sky Canyon.

Aerial photos of the subject can be found on page 1849.

Uh, the this parcel was created on uh September 18th, 2023 uh by a final map of Axel at Stun So Sunstone Phase 1, a subdivision map.

The parcel is zoned TD for traditional development, allowing mixed use, including residential.

The parcel was erroneously valued as a common element at zero value for 2425 and 2526.

Uh the assessor's office recommends taxable values for both years at 5,791,400, which is 460,000 per acre.

Uh the petitioner was sent a letter that they received that was delivered on uh February 5th, and the notice of this hearing was delivered to them on the 29th of January.

And I don't believe the petitioners here, but that was my next question.

Um the subject was created on September 18th of 23 at page 1855 shows the parcel on the final map indicating it as a large lot one.

The legal description of this parcel is Axel at Sunstone Phase 1, Platbook 171, page 35 lot LL1.

This parcel does not qualify as a common element parcel per NRS 36123 and should have been valued at market value for both years.

Um there are land grids in the case um page 1868 and 1877.

I'm sorry, 1868 and 1869.

Um the land grid um provides support for our land valuation for both years at 5,791,400 or 460,000 an acre.

Members of the board, any questions based on the information provided and testimony contained here in my motion that we accept the assessor's recommendation on case 598.

Please cast your votes.

That motion passes.

We are not hearing 1136.

Correct.

That is correct.

Very good.

Nothing else on number nine for our agenda.

That is correct.

Great.

Number 10, we're reviewing procedural rules relative to presenting appeals.

This hearing is recorded and part of the public record.

It is difficult to transcribe the hearings with concurrent multiple voices.

Please do not speak if another party has the floor.

If you have the floor, please speak clearly into the microphone.

Please note that we do not discuss property taxes in these hearings.

Your net property taxes may not be affected by the outcome of your case.

The procedural rules relative to presenting appeals are as follows.

When we call your case, please come up to the microphone, state your name and address into the record, uh into the microphone for the record.

The assessor will briefly describe the property to the board.

You will then present evidence for your case.

The assessor's office staff will provide their evidence to support the assessor's opinion of the taxable value.

You may then respond to the assessor's case, but you were limited to the rebuttal of evidence presented by the assessor.

Please keep comments limited specifically to your case.

Please do not address the assessor staff.

The board will ask questions of the petitioner or the assessor staff.

The board will discuss the testimony and information provided and move forward with the decision.

If you or the assessor's office are unhappy with the board's decision, both parties have the right to appeal with the state board of equalization.

Appeal forms are in the hallway outside the doors to the chamber.

Do we have any administrative business?

Chairman uh Mary Ann Winer, for the record, there is no additional administrative business at this time.

Excellent.

Thank you.

All right, let's get started.

Case 65.

Benito Tuscan LLC.

Please state your name and address into the microphone.

Jim Seusa, Deacon CNA McDonald, law firm.

2525 East Broadway Boulevard, suite 200, Tucson, Arizona, 85716.

Katie.

AD Rapanello of Latitude Property Management, 1050 East Flamingo Road, suite 253, Las Vegas, 89119.

Thank you.

Excuse me, Melody Garfield for the assessor's office.

The case begins on page 665 in the master book.

If you want to see photographs of the property, I put the co-star pictures in there.

They're on page 785.

And there's an aerial map of the subject on page 801.

The property is a 300-plus unit apartment complex known as Tuscan Highlands, and it's in Southern Highlands.

It's adjacent to I-15, just southwest of St.

Rose Parkway.

It was built in 2020, so it's a relatively new property.

As of December 18th, there were 38 units of the 300 plus vacant or about a 12 and a half, 13% vacancy.

The community amenities include a clubhouse and fitness center, sauna, pool and spa, cabanas.

Additional things are putting green.

The assessor recommends no change to the 2627 taxable value, which ends up being about 242,000 per unit.

Thank you.

Thank you, Mr.

Farr.

Uh, first I'd like to thank uh Ms.

Garfield for submitting her materials to me and for taking my phone calls and answering my questions.

Appreciate that from the assessor's office.

Uh I'd like to introduce uh Katie Raffinella, who is a property manager.

Uh and Katie, I have a couple of questions for you.

Um did you become involved with this particular property?

August 16th of 2024, the property went into court ordered receivership from Keller Investments.

I was hired by the receiver try guild for to manage the on-site operations during the receivership.

Okay, and then did you continue to do that after the receivership ended?

Yes.

And are you managing the property today?

Yes.

Do you manage other properties in the Las Vegas Valley?

Yes.

Do you have a lengthy history of managing multifamily properties here in Las Vegas Valley?

32 years.

Okay, thank you.

Um I would like to kind of cut to the chase here on this.

Uh I prepared and hopefully the camera will pick this up.

A side-by-side analysis of what the actual financials uh of the property show.

And this is on page 777 of the materials that you have, and that's the left-hand column, and then the assessor's recommendations on page 781 of the materials that you have.

So I've pulled the numbers from those two areas.

And Katie, is it your experience that in uh apartment multifamily housing here in Las Vegas uh complexes are bought and sold based on their operating income?

Yes.

Okay, yes, we can the mic.

Yes.

Thanks.

Okay.

Uh so in this particular analysis, I've tracked the items that we have agreement with the assessor on, which are the potential gross income and then the total expenses and the capitalization rate.

And I've highlighted uh some of the great uh differences that we have.

And the first one has to do with the vacancy uh loss.

Uh this is the actual financials through December, and it's at 1.8 million dollars, and the assessor is at 842,000.

Can you tell me uh some of the reason why there was such a large vacancy loss compared to what the assessor considered to be a market?

Um, well, there was a lot of product that came into that area over the course of the last uh couple years.

Um there was also some issues, obviously, when a property goes through receivership and foreclosure, there is some fallout that that contributes to that as well.

So, and just the market conditions with the supply and demand in that particular pocket of uh near Southern Highlands in St.

Rose.

There's been at least six or seven properties that came online in the past two years alone.

All right.

So, Katie, do you know why this property went into receivership?

Uh performance, I you know, I I can't speculate exactly.

I can say what I know about uh the operations of the community.

Um the rents were extremely high at that time in comparison to the comps coming online.

Um the restaurant had some issues, their expenses were way out of control, and um I don't know why Keller ultimately stopped paying, but that's when we came in.

The expenses were I believe around 13,000 per unit at the time of receivership.

All right.

So in the vacancy loss, uh I believe the uh assessor mentioned that at the very end of the year, the vacancy was down to around 12.5 percent of all the available units.

Correct.

Is that kind of the best uh vacancy rate you had for the entire 12 month period?

Absolutely.

Okay, absolutely.

So in the financials, and again, this is on page 777.

It shows that just for December, which was the best month we've had, the vacancy is 89012 for the month.

So 90,000 if we're gonna ballpark it for the month times 12 months, gets us over a million dollars uh worth of vacancy just in uh if that was the best month possible, it'd still be a million dollars.

The actual was a million eight, and so would you say the trend is getting better, but we're still sitting at $90,000 a month worth of vacancy?

Yes, correct.

Do you expect that vacancy amount to continue going forward to be somewhat near that?

Yes.

Okay, so it's not gonna go back to 14 or 15 percent, but it's not gonna go to 10 percent either.

I don't believe so, no.

Okay.

Um, so then the next two items where we have a disagreement with the assessor are on the loss to lease and concessions, and on the assessor's presentation, they have said there's nothing to be uh added separately for those, and that the $842,000 number that they've put for vacancy loss subsumes those amounts.

So those amounts are 541,000 and 595,000.

Can you please tell me what the loss to lease is?

What does that mean?

So the loss to lease, uh, we did discount the rents in an effort to incentivize more traffic and uh rentals uh uh to get the occupancy up.

It was something that was very necessary.

Um we weren't getting a lot of action with the current rents.

So to put it in perspective, um the assessors have it at 2,093 average rent.

If you annualize our net potential rate now, we're at 1947 on average per unit.

That is quite significant for that size community.

We do expect that to continue as is.

We have not increased our rates even with the reduction of vacancy loss based on current market conditions.

Okay, and then what are the concessions?

The concessions were up front concessions, the average concessions in that market are two to three months' rent.

Some of them were doing up to four months rent.

Um I'd say eight to ten weeks is the average rate now if you look at the comps in the area.

I also do not expect that to let up in in this year or possibly next year, maybe hopefully go down a little bit, maybe one month, but I don't expect them to go away in the next couple years.

All right.

So you heard the assessor talk about some of the amenities that were at the property and that was recently built.

This is a fairly high end property and you provide a number of nice amenities because of that all comes at uh operating cost.

Yes.

Okay.

And then the rents are hopefully reflecting the it's the high end community have you had difficulty in attracting a lot of people to pay those higher end rents to get those high end immunities yes I mean it's just you know again there are thousands of units in that southern pocket that came in over the last few years I could name at least eight that has driven our our cost down they I don't know if they overshot when they built that property on the rents at that time it was you know 2020 all the rents skyrocketed in 2122 I think it just went a little overboard.

I think what we're running at right now is what's going to be more in line for for several years.

So Katie let's look at the information that's in front of us projecting forward if December was our best month and that still gave us a million dollars uh year annualized of vacancy loss and you think these other two items for loss to lease and concessions will remain constant there's like about a two million dollar swing between the assessor's 842000 and what the actual amount of the expenses are going to be correct.

Okay.

Let's go to the other income for a second uh this number is very much larger than what the assessor has and I've asked you for an explanation of that and you've told me one of the explanations was 110,000 that was booked as other income as a final amount from the receivership can you explain what that was yeah it was just a reconciliation of the receivership funds that um did not happen until 2025 it's reflected under miscellaneous other income last line item in that section okay uh were there any other extraordinary items in there um legal fees legal fees those are uh you know the we do uh process server now for all of our legal fees for um and evictions and all of those things as well it shows us other income but it does offset an expense um we do not upcharge on any of those things we're just asking asking the resident for reimbursement for the actual expense for those costs all right so uh going back to the assessor's analysis the assessor has net operating income at 4.3 million dollars uh if there were two million dollars worth of additional expenses that would drop it down to 2.2 million dollars is that consistent with the property's performance yes okay is that what your expectation is going to be kind of going forward absolutely okay um just want to go through the very last thing the history of this 2020 it's built uh my understanding is it was immediately sold and it was sold for was it 115 million dollars something like that okay and the people started operating it and at some point maybe three years in it ran into enough financial difficulty that the lender got a court involved had a receiver appointed the receiver hired you to keep an eye on the cash flow and things like that is that accurate that's accurate correct and then Veneto came in and purchased the remaining debt amount uh at some point 2024 end of 2024 very good and then because nobody was making any payments on it they then put it through foreclosure and they did a maximum credit bid for the amount of the debt and that's what the sale price is that's reflected on there.

Yes correct and since that time is the financials have uh gotten better right correct okay good Mr.

Farr uh I think that's it though one thing that I would ask you to do is uh I remember hearing your lawyer talk about the various requirements for the board and I pulled this out because I didn't hear it from the Nevada revised statutes that were discussed but this is the administrative code and I wanted to point out the independent determination of value is contained in the administrative code the board is staffed with licensed Nevada attorneys I'm sorry licensed uh appraisers and I would ask you to make an independent determination as to the fair market value of this property based on the dynamics that you have in front of you which are that it's below the 73 million dollars because the income that's being generated is substantially lower than the amount that the assessor's calculation comes up with and I understand the assessor is saying these are what we think the market would be but the market also has to yield to the actuality of this is something that's going to be going forward competing with lots of other people concessions losses vacancies will occur and when they do the net operating income is going to be far below what the assessor believes it's going to be and I would hope that if you were appraising this property you would take that into account and come up with a different value.

And I would hope that if you were appraising this property, you would take that into account and come up with a different value.

Thank you, sir.

Thank you, Ms.

Garfield.

Just real quick, do you have copies of that to hand out or no?

I do.

Um it's the this is the one you're talking about.

Yes.

Okay.

Please, thank you.

Again, Melody Garfield for the assessor's office.

My cap summary is on page 781.

Um the appellant, I do appreciate Mr.

Seusa, you providing the most recent rent rule and the financial statement, and his updated statement, as he said, is page 70 77 there.

So the rents provided come directly from the rent roll, and that's how we came up with our PGI, our potential gross income, which um Mr.

Seusa doesn't appear to have a have have an issue with.

As regard to vacancy, I did use uh market vacancy, which I have um different entities indicating is between six and nine.

And so I really went with 11.

Uh, we do show that the vacancy has declined in the last year in that market area from about 13 to 9 according to CoStar.

So I thought 11 was a good market rent to use and does include uh a little bit for concessions.

Um as with with regard to the other income, again, Mr.

Sousa indicated they had over a million.

We said five percent, which we believe is closer to market.

Um just the amenity fees were 442, uh, not including any other um other income.

So the 341 I thought was um was reasonable and based on market.

Um with regard to the um expenses, um we do have uh market indications.

Uh co star indicates about four dollars and seventy-eight cents a square foot for this sort of class and in that market area, but that would only be about five thousand dollars a unit.

Um we have a 40 percent expense ratio, which is from realty rates, they say 37.98, something like that.

So we went with 40 percent on the expenses.

There are a lot of amenities that ended up being 93.90 a unit, which is very close to what um what the appellant indicated for their for the property.

Um I like a five percent cap rate, and we do have um indications from IRR five to five and three quarters.

CoStar um is saying five percent for the submarket, so we you know didn't uh disagree with Mr.

Seuss's 5.5 percent, so that's where we come up with a cap rate again.

This is for market, and then we did subtract the personal property account, uh, so that 762,000 you see that's a negative to the total value, and we also did um a little over 200,000 for stabilization or lease up costs.

That calculation is on the next page if you want to see where the 214,000 came.

And so that gave us a property value of about 77 million, and that's about 250 a unit, and we're at 240 a unit.

So we did not believe that this uh indicates any issues.

The the the uh with our with our market value, and you can see even on the financial statements that things have improved throughout the year, and we're looking forward to the year to come.

And so, you know, we we didn't think that that really high uh vacancy needed to be in there now, and we counted for it in the stabilization.

Now, this is the income approach.

If you guys want to look at the sales comparison approach, I think that you're familiar with a lot of sales um in the in the area.

Um, and if you look at page 792, um I have a few sales there.

They also support a cap rate closer to five percent, and they illustrate a range of 250 to 316 per unit.

And the one that I have at 250 is actually a distressed sale.

Um Mr.

Sousa provided a list of sales, um uh 19 sales, that's in his exhibit B.

Um, that is on page 685.

But if you look at those sales and you look at the ones that are closer to age to the subject, um they start at 275.

So again, we only have it on at about 242 uh a unit.

And so we believe that both the income approach and the sales comparison approach support our valuation, and we don't see um enough of an argument for a reduction.

I have a quick question on it.

Okay.

Um you're saying 12 and a half percent is your vacancy rate.

In December was our best month ever.

The vacancy rate's been up at 15, it's been working its way down.

When we get to 12 and a half percent, yeah, it's 90,000 a month in vacancy, so it's a million bucks a year.

We had a million eight for last year, so it tells you that the vacancy rates have been sliding down, which is good, but we think it's gonna stay at this 12 and a half percent.

Okay, so before we get to questions, let's do you have any rebuttal for the assessor's case?

There was, but I just wanted to we were we spoke out of turn.

Apologies.

Do you have rebuttal for the assessor case, sir?

I do, sir.

Please.

Thank you.

So Katie, I'm gonna ask you about this because this is more your field than mine.

Uh the assessor has provided both an income approach to value and a comparable sales approach to value, looking at sales of units that are in the valley.

Um you're familiar with the multifamily real estate market here in Las Vegas?

Yes.

And this comes from multiple years of working in that field.

Yes.

Yes, sorry.

And do people buy and sell multifamily complexes based on a comparable sales analysis, or do they look at the specific income of the unit they're trying to buy?

Uh in some cases a combination of both.

Okay.

And what is the predominant uh one for a complex like this, which is fairly new?

It's going to be based on the income.

Okay, thank you.

Now you sent me a note, and I don't quite understand what it means.

Um, but it says turnover rents are lower than uh rents in place.

So what does that mean?

I I just want to make a comment about that.

So when this property was built and when the rents were underwritten and all of that, um they in my opinion were incredibly high for that area.

Um, and again, it was showing it at 2093 average per unit, and we're actually at 1947.

We have to take into consideration the units that are turning over, some of those residents moved in at the higher rates.

Um our turnover rents on average are two to four hundred dollars per month less than what the initial people were paying at move in.

And I don't expect that to change.

It may go down.

Um, we may get a little rent growth.

They're talking about three percent very modestly.

Um, our average in in Vegas is three to four higher on a on a five to six.

I don't expect to see that till about twenty twenty-eight um when most of the uh supply is absorbed, and you know, we're getting back in a in a normal um year over year rent growth.

Uh but we have not seen that.

I think that's part of the reason that they did not fight for this asset, because it was just way over overvalued, and there was no way they were gonna get out of it based on how it was at that time.

And you say they being the original.

The original borrower.

Okay, and that's why the receivership happened.

Yeah, that's correct.

They did not dispute it, they did not argue it.

I think they based on what was going on in the market, there was no way they were gonna get what they needed to sustain.

The assessor in their presentation talked about there are certain market dynamics for things like uh operating expenses, vacancy losses, and things like that.

Correct.

Is your area in the southwest portion of the valley?

Is that accurate southwest?

Maybe is that consistent with that market area?

Uh it depends.

There's a lot of high-end product in that area.

So on average, I would expect Tuskin to run it's it's a two-story, it does have an elevator, it does have all that stuff, it does have enclosed highway uh uh hallways, which does slightly inflate the cost per unit on expenses and your typical two-story walk-up, like a Nevada West build where there's no enclosed hallways.

A lot of that's huge income or huge expense.

That's about 334 dollars per unit per year for Tuscan Highlands alone.

Um, we also in the Southern Highlands HOA, that's about $7,000 a month.

Um, so there are additional things, it's a it's an 8,000 square foot gym.

There are certain things that do inflate the expenses on that asset, but all of them are slightly different in that area.

So an A product could run between nine and twelve thirteen per unit on expenses, depending on the build.

Okay.

In that area.

So one final question.

So in 2025, there was a $2.7 million dollar NOI, which had this vacancy loss, the other losses had this other income, all penciling out to that.

Going forward, would you anticipate that the NOI is gonna be in the same say $2.5 to $3 million range uh based on the non-recurring things, vacancy losses, those sort of things?

Correct.

To get that rank growth back is going to take several, several years.

Okay.

That's all I had, sir.

You had some questions.

Sure.

Just on your uh vacancy um estimate here at 1.8 million.

How is that 12%?

Sure.

So the 1.8 million isn't an estimate, the actual for 2025.

And when you get all the way in the uh full 12 month chart, and you get down to December, December was the best month, and that had 12.5%.

In the months that were prior to that, 13, 14, 15, 16 percent vacancy, which is why the numbers are bigger on that line on the 12 month financial statement, which is in the record, and it should be I think 777 is the page.

And so by the time that we get to December, uh that line is down to 89012, but that line started at 180, 850 in January.

So far more vacancies in January, and you can see the numbers going down as time goes on, as the vacancies are filled, and then you finally get to December and you're at 12.5 percent.

So our best month ever was the very last one that we had, and that was still 12.5.

And so the average vacancy is over 20 percent.

We have to defer to you.

Correct.

And I do if I can make one statement.

I know that we look at the co star, I purchase COSTAR, I use it as a market analysis.

I also use ALN, I use uh MFE, I use the Nevada State Department Association, the National Apartment Association, all as tools to look because all of them look at several different things.

Um co star gets a lot of their information, they're a great source, by the way.

I use them for a lot of staff, but they get what's being advertised to apartments.com, homes.com, all of those things.

It's not a perfect science, so I take like ALN and CoStar and some other market analysis to kind of see where we're gonna fall.

Because co star, if if if an apartment gets 30 notices to vacate, they aren't gonna advertise that.

So they're leased up, maybe 15% less than what their current occupancy is.

And if they don't backfill, that's where they're gonna be, right?

But they don't want to show that much because they're on notice, they haven't physically moved out yet, they've already got plenty of product online.

That's where CoSTAR pulls our occupancy and lease up.

So it's not an exact science.

If you look at ALN, um, that national report is a great report for all different markets.

They're saying that Vegas is going to hover around 87.5 to 88.5%.

That's where we are currently, and that's what they're projecting in 2026.

Katie, I think the question that he may have asked, and I'll say you kind of went off on a tangent there.

At the end of the year, the vacancy, actual vacancy was 12.5% of all the units available.

Yes.

Best month ever.

At the beginning of the year, the numbers are much higher for vacancy.

And he asked, was it on average for the entire year?

About 20%.

Yes.

Okay.

Which means that some point you had 30% vacancy.

Yes.

I mean, that that is, and that was addressed by the stabilization, right?

You discounted for that.

Well, that, and you can see that it's improving.

You can see, yeah, they had a rough patch in the beginning of the year, but all their numbers are improving.

So to include that moving forward, that higher vacancy to me doesn't seem reasonable.

Yeah, the the idea to me that you're gonna go backwards back to 30 percent, seems like it would be mismanaged at that point.

Correct.

Yeah, so we didn't make a claim that we were going backwards.

Well, I I understand, but here you are saying in this estimate that your average vacancy moving forward is going to be out of what is this 20 something percent.

12.5.

Well, well, no, because your 12-month financial statement uh you're essentially asking us to use 1.8 million dollars.

I'm with you now.

Okay, now I'm catching up.

So the actual was 1.8, and the vacancy rate changed throughout the entire year, and we're getting at the best point we are now.

Yeah, and in my presentation earlier, I said that's 1.8 million dollars in expenses.

Because we're getting better, I asked her, can we use December, which had 90,000 a month as a vacancy, kind of project forward is what we think we're gonna be at, and she said yes.

Okay.

So now 1.8 is really a million, right?

90,000 times 12, a million.

So we said we'll be at a million dollars in vacancy going forward.

We'll still have the other two categories of loss to rent and things like that, but not what we had in 2025 is the we're asking you to buy that for the future.

We're not even there.

Okay.

So if you take a million in vacancy, these other 500 and 600,000 numbers, you see there's a million two, no, two million one in those three items, and the assessors at 800,000.

So real easy.

We're 2 million one, third 800,000.

We would think that 2 million one is a much more credible number than the 800,000 that they've put for concessions, which they say captures all the other things too.

And if you value it based on the two million one in those three categories, the number is far less than where the assessor's analysis concludes.

Yeah.

For for our purposes, a third column showing essentially what you're asking for would be nice, or what you project.

So we have an apples apples comparison as opposed to discounting 1.8 million.

Let's do it right now.

What?

Yeah, I mean we do it right now.

Sure.

So this number becomes a million here.

Which means that the delta is 170,000.

170,000 there, 541 there, 546 there.

So this is a million one, this is a million three.

So our number is a million three less than where the assessor ends up.

The assessor ends up at 4.3.

And I asked her, do you expect this to be a 2.5 to 3 million dollar NOI property going forward based on everything that we know now?

Her answer was yes.

So they're at 4.3.

We'd like to be at 3 or 2.5.

We just don't want to be at 4.3.

Okay.

How Ms.

Carpell.

Um loss to lease and concessions.

Where do you guys stand on that?

As far as I know it's zero.

You have that's your estimate, but is there any accounting for that?

Well, I just think the 11% sort of takes into account that amount, and then we have the lease up costs that we subtracted.

If you add those two, we're over a million there, the 842 plus the 214 lease up.

Um, and then you know the the other income we only have at 341, which maybe we should have a lot higher.

So, you know, maybe those those things balance out.

But um, yeah, I I think it's included in the 11 percent.

I mean, uh the apartment market is you know pretty good right now, and certainly um sales comparisons uh support that as well.

I know you know we want to focus on the income.

Uh as you guys know, we also have the Grammar C and the Ellison that are pending for you know, 310 and 350 a unit, and it just seems like our market estimates are good, and December illustrates that, and we're moving forward.

We're not moving back to January when um they took the property over and it was in uh bad shape.

So I think the 23 to 30 percent vacancy that they're estimating is is way too high.

I just seen a moment do a little bit of math.

Can I ask what's in the um other income from the petitioner, the million seven or the million seven thousand, I should say?

Why the big discrepancy between the two two figures?

So one of the differences was the 110,000 dollars that came in from the receivership, which was a holdover from the prior period.

So that puts us down into about 800 and yeah, about 890,000, and then there were some legal fees and other expenses which are small, probably puts us around uh 850,000.

So I would say, and Katie, I need you to tell me is the other income gonna be somewhere in the 800,000-ish range moving forward based on what we had as other income in 2025 that would be non-recurring.

If you look at the other income, I would annualize a trailing three of 2025, the last quarter.

Um, because we did make some changes on amenity fees to reduction permanently to be in line with the market as well, cut them in about half on new leases and on renewals as they come up for renewal, that will be reduced as well.

So if you annualize you know, yeah, my calculator, the trailing three for the total other income, that would be more um uh accurate for what we expect to see moving forward.

So our highest month on collections for other income was 149,150, let's say, and now we're averaging about 75, 76,000 a month due to those changes and reductions in the other income charges to residents.

So other income 76,000 a month is will be the average moving forward, correct?

Right.

So is that about 900,000?

That sound right?

76 times 12.

The property is no longer in a receivership, is that correct?

No, it foreclosed on uh December 31st, 2024.

How much impact did the receivership have on the day-to-day operations, such as approving lease applications or that?

Did it delay anything?

Uh they didn't cause any delay.

They were pretty hands-on.

It was a local uh receiver that I corresponded with several times a day, uh, several times a week.

So we were able to work with them on really finding the rent rates that were gonna work moving forward, um, concessions and some of these other uh changes to the charges that what they were doing on the property prior to receivership.

Am I correct in assuming that you're not using an LRO or a yield star?

Correct, we are not.

Okay.

Flat rate.

Since the property appears to be heading towards stabilization at a reasonable percentage, um, I would imagine the concessions would probably be reduced moving forward.

I don't think it 53% of the properties in Las Vegas currently today are using concessions.

On average, are they using it at 7.7%?

They're averaging one to three months.

I mean, if you look at Boulder Highway, they're doing two months to three months because of the product influx.

Um that pocket, Silverado Ranch pocket, they're all doing one month to six to eight weeks.

I mean, that is what it is.

And what is your average retention of a uh tenant?

Um it depends on the higher end staff.

We're seeing it's about a 405% turnover rate now.

We do have people who can move into Tuscan, get two months, and in a year they can move into Illumina and get three months.

We do have that.

That does that is part of the business when we do have uh a lot of supply and the demand is not as strong.

Um you were mentioning Ellison and Grammarcy extremely familiar with those assets.

I have walked them in detail.

Love the Grammarcy.

Ellison's extremely overpriced, he's extremely over leveraged on that asset.

Um he is competing in a different marketplace as well.

He's competing against Avora, which is about $4,000 a month, more in the Spring Valley marketplace in between New Summerlin or however you want to do it, totally different market when you're comparing.

It's not it's in my opinion, it's not apples to apples to what we're speaking of.

And what what would be the reason uh seven percent of loss to lease?

What would be the reason that would go up or down?

Honestly, had we changed that number and had a significantly reduced uh our goal is market rent that's reflected, okay?

The gross potential.

That was our goal.

That's where we were hoping we were gonna be at.

We didn't know we were gonna have to discount the rents that substantially to keep up, or because uh original rents were so inflated, but honestly, if I turned around, some clients do carry that loss to lease and they try to burn it off and get it back to where they expect it to be.

Um, and some don't like to carry loss to lease at all.

You simply just change the market to rent to what the average rent per unit currently is, and that's what it is.

It's it's just a number we overstated on the market rents, which is still less than the market rents that were from prior ownership.

Okay.

Member of the board, I would I would do a new calculation, but um I think it's reasonable to assume there is some concessions to be made.

Um not seven and a half percent, but you know, uh if you're saying one month at least per year, and you have 50 percent retention, so half of that is four percent there, lost the lease.

I'd be flexible on uh having some type of number, but uh zero doesn't seem that I don't know if I would apply zero.

I don't know if I would apply seven though.

Uh and then outside of that, the vacancy million eight, obviously that numbers we discussed uh unlikely.

Um so applying even a 12% or 12 and a half percent and then rerunning the numbers.

Is there anything any adjustments to those numbers you would think?

Go ahead in there just so that they know the no how you ran it.

Just so uh I don't know, we're on this we're all on the same page.

I re-ran um using the potential gross income from the 12 month financial statement.

I plugged in a 12 and a half vacancy rate, and I used the uh loss to lease and concessions that were provided, and I used the other income at the uh I just kind of split the other income in half.

I actually use a 666, 686.

Um that ended up with an NOI of 3,468.

It looks like the NOI on the 12 month financial statements 2 million seven forty-six, and the assessors is 4 million 296.

So it's adjusted coming kind of in between it all.

Just for the appellate, uh sales in this case um are a good test of reasonableness, a good test of reasonableness.

So um if if you're telling me this is price per pound under 200 a door, it there's a flag that pops up.

Um just in general, I'm just letting you know.

And then you had also mentioned, you know, a couple times that this is a fairly new project and it's new, new, new.

We're comparing it to new projects, and then um, you know, anything uh Ms.

Garfield had said on your list that of the comps are I mean, I saw 1981, so a lot of those projects aren't really gonna be directly comparable.

Um, but I I get both of your points.

Can Mr.

Odamo, can I just address quickly?

We pulled out just a report of sales that occurred and on a per dollar or per door basis.

So we just applied that with our appeal saying here's our income, here's some sales we found.

We're not coming in hi, here's our stuff figured out.

We're trying to get to a right number here, which is why I brought the witness as well.

Okay.

One of my concerns is with the expenses that you list.

There's there's some expenses, and in fact, some that are gonna show on your taxes, for instance, that would not show on evaluation.

So you mentioned legal expenses before.

We we're not gonna include that in our analysis.

That's that's not how the market does it.

So that's where I'm kind of questioning, you know, having a total expense line of 3 million 23 compared to the uh 2.8 that the assessor does.

There isn't enough information for me to give that a whole lot of of credibility.

I don't know what you've included in that number, right?

And that that's part of our concern.

We when a lot of times when we hear cases, they there's a lot of expenses like travel, right?

Expenses that are part of it.

I I but I don't know if they're included in that, right?

You you did mention legal, we're not going to include legal, right?

It's just not what we do in our in the valuation of these properties.

Mr.

Farr, I mentioned legal and I mentioned it as an other income item as non-recurring.

So we were receiving money and not expensing.

But you included it in the calculations, and my point is we would exclude it.

No, I included other income items, not expense items.

When I said why is there a big difference between your number for other income and the assessors?

We had the receivership income that came in, we had legal expenses where we were reimbursed, and we had one other item that was small.

So these weren't expenses.

This was why is our other income item higher than theirs.

So you're going to be able to do that.

Well, and my point is you're you're using the actual financial statement, not a a uh statement that an appraiser would use where we would exclude those, you know.

We're looking at stabilized income, right?

And if you're including income from a receivership, that's not stabilized.

We agree.

We we would throw that out.

But my point is this is all we have.

I I don't have historicals, I don't have trending, I don't have you have you have a 12-month 300 line.

What page is that on?

777 is the start.

And it's the 12 month.

We also sent them the 11 month before we had the 12 month.

Yeah, and it has all of the figures.

So mine was just for presentation to show you the areas where we agreed with the assessor's office.

And then the areas where we had dispute, just for presentation.

Yeah, my concern is if you if you mix some of the assessors' information and your information, like a 12 and a half percent uh vacancy rate, use your expense um indication, but also include the other income adjustment.

You kind of end up with the same place, right?

I keep coming back to the same place.

Respectfully, we're not trying to mix their information.

No, I no, I understand.

But but what I'm saying is some of the stuff that the assessors come up with is reasonable, you've accepted it like the gross income.

Yes.

And and if I use your vacancy and your actual expenses, then it really comes down to the concessions.

And I don't know that those should be uh capitalized into perpetuity.

I mean, that's a the concessions, you know, if you're gonna capitalize those in the perpetuity, then we're back to the 20% vacancy, which I don't think is appropriate, and I don't think anybody does.

So uh for me, we just keep coming back to that pretty close to that same net income.

And I've I've I've scribbled down a lot of things here, and and I keep coming back to those pretty close to the assessor's uh net income on a stabilized basis.

I'm not you don't ask me to respond.

I just that's a comment.

Well, I guess I guess the other question I have do you have any I have you had any value?

Obviously, you haven't had any actual valuation done.

Right, because this was purchased by the credit bid.

Does it does the owner have an opinion as to what it's worth?

The order believes that the NOI is going to be between 2.5 and 3 million dollars, not the 4.3 the assessor has, and that's based on ownership, how it's getting better, but the market that they're in and the things they have to do to keep a luxury apartment complex filled.

If you're a low-end apartment complex, it's a lot easier to fill.

A lot more people.

This is higher.

Thank you.

Yeah, I'm I'm coming back to um what Mr.

Anderson was saying, that I'm cycling some of these numbers, different scenarios, 12 and a half percent vacancy, um, cutting down loss to lease and concessions, trying to be somewhat reasonable with that.

Uh again, in perpetuity, it's gonna be a lot less.

That's the way we look at it with the direct cap, and then um using the adjusted other income of approximately nine hundred thousand, and what seems to be pretty reasonable expense at 10 a door, uh 10,000 a door, and my imputed value.

I mean, it's it ends up being pretty much the same at the end of the day.

I'm at like 240 and change a door.

Uh what's that in total taxable value?

Uh well I have 75, 381,025 using four percent on the concessions and four percent on loss to lease, which uh in an appraisal I'd probably use less.

Um obviously if we're using 12 and a half percent vacancy, because if you're looking at it from like he was saying, I mean it's 20 percent essentially applying for vacancy and collection loss, which I I don't know.

That would be very high for me to use, it would be a very specific set of circumstances for me to use something that high.

Agree, yeah.

And so at the end of the day, coming back to those numbers.

Um, you know, you have imputed value here is it 242 door 177?

Yes, that's correct.

That's a hair less than what I've got.

So I make a motion to maintain the assessor's recommendation made, please cast your votes that motion passes.

You do have the right to appeal.

Forums are outside the door.

Thanks for your time.

Thank you.

Do we have uh any remaining cases that have been stipulated to or withdrawn?

Um yes, we do have one um one case on the agenda that was withdrawn, case 493.

Okay.

Um and then we would need the board to rule on all the remaining cases on the agenda, those were stipulated, withdrawn, or or petitioners that didn't show up, um, excluding case 1136, which was that um um escaping taxation case, and then 493, I guess.

With the exceptions of cases 493 and 1136, I motion to accept we don't want to exclude 493.

We want to vote on it because it's withdrawn on your agenda.

Oh, because it's withdrawn, I take that back.

So with the exception of case 1136.

I motion to accept the assessor's recommendation on any cases where the petitioners did not attend this hearing, and those that have been stamped stipulated or withdrawn.

Please cast your votes.

And that motion passes.

Okay.

Um so we have a total of 275 cases remaining.

Uh for this Wednesday, the February 11th, we have 64 cases.

Thursday, February 19th, which is a residential day, we have 44 cases.

Monday, February 23rd, we have 82 cases remaining.

Uh Tuesday, February 24th, 42 cases remaining, and Wednesday, February 25th, 43 cases remaining.

Great.

Microphone is open for any public comment.

Seeing none, I will close the microphone.

Is there any other business?

No other business.

Uh just uh next hearing on Wednesday at 8 o'clock, February 11th.

Very good.

Thank you for your time.

Meeting is adjourned.