Three Learning Highlights: 1. The use of the income approach in valuing fractional interests in real estate holding companies 2. Discussion of valuation methods averred by the Court in valuing these interests 3. Limitations of the NAV method
Learning Objectives
The presentation will focus on the chronology of valuation methods averred by U.S. Tax Court over the last 40 years for noncontrolling, nonmarketable interests in operating real estate holding companies. Discussed will be misconceptions many users and even valuators may have determining the Fair Market Value (FMV) of interests in these entities, some of which include applying Net Asset Value (NAV) methods. We will discuss limitations and differences between the real estate appraiser’s value of the underlying property and the FMV of noncontrolling interests in entities holding these properties.
Major Topics
Three Learning Highlights: 1. The use of the income approach in valuing fractional interests in real estate holding companies 2. Discussion of valuation methods averred by the Court in valuing these interests 3. Limitations of the NAV method
