Lequant Computer Services (Qld) Pty Ltd v Chief Executive, Department of Natural Resources
[1997] QLC 14
•14 February 1997
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BRISBANE
14 FEBRUARY1997
Re: AV96-207 -
An appeal against an unimproved valuation -
Valuation of Land Act 1944 -
Town of Goondiwindi
Lequant Computer Services (Qld) Pty Ltd
v.
Chief Executive, Department of Natural Resources
(Hearing at Goondiwindi)
D E C I S I O N
As at 1 January 1996 the unimproved value of land described as Lots 1 and 2 on RP 92771, Parish of Goondiwindi, containing 2,023 m², has been assessed by the Department of Natural Resources, as it now is, in the amount of $140,000. The land is located at the corner of McLean and Callandoon Streets about 100 metres north of the Goondiwindi Post Office. It is zoned “Central Business” and is developed and used as a motel.
The appellant company contends for a valuation of $121,380 or $60 per m². The primary ground of appeal is an alleged lack of proper relativity between the valuation of the subject land and valuations of other properties and in particular other motel properties situated in Marshall Street in the block east of McLean Street to Pratten Street.
Mr M. Mildner, the manager of the subject motel property, appeared for the appellant company and gave evidence in support of the grounds of appeal. In his opinion, because Marshall Street has replaced McLean Street as the main thoroughfare into the town centre, there has been as a consequence, a shift in user demand for not only motel premises but fringe-located commercial/retail property, into Marshall Street. In his opinion, if the Post Office at the corner of Marshall and McLean Streets was accepted as the town centre (which it is not) there should be seen to be inequity in Marshall Street properties in the block to the east of McLean Street towards Pratten Street being valued as inferior to the subject property on a unit of area basis. He referred to the closure of certain businesses and shop vacancies where the location of premises was now considered secondary to Marshall Street.
Mr A.B. Cowley was the valuer who had carried out the Department’s valuation. He described the property as being on the fringe of the business centre and acknowledged that “until the construction of the Goondiwindi Bypass, McLean Street was the main thoroughfare through town for interstate traffic. In an area generally flat in elevation, the subject land “was well elevated being one of the highest parcels of land in the Town of Goondiwindi”. In its unimproved state good access would be available from both McLean and Callandoon Streets and a laneway on the southern boundary.
In Mr Cowley’s opinion, the “Central Business” zoning of the land, its access and its fringe town centre location were important criteria which had been reflected in his valuation. He had not valued the land specifically as a motel site, because, in his opinion, if unimproved the land had a range of commercial use potentialities.
His basis of valuation had been obtained from the sales of two properties within the “Central Business” zone.
A 1,230 m² site in Herbert Street, close to the heart of the business centre, had sold in August 1995 showing an analysed unimproved value of $142,000 ($115/m²). A valuation of $100/m² had been applied to that land at the relevant date. In comparison the sale site was described as “smaller in size, superior in location, similar in services and inferior in access. Superior overall on a rate/m²”. The second sale was of a “Central Business” zoned site of 286 m² in Marshall Street. The land had sold in September 1995 showing an analysed unimproved value of $46,500 ($162/m²). A valuation of $141/m² had been applied. In comparison with the subject land this sale site was described as “smaller in size, superior in location, similar in services and inferior in access to the subject. Superior overall on a rate/m²”.
Mr Cowley felt comfortable with the relativity of valuations in the “Central Business” zone. He provided details of a number of applied valuations. Corner blocks of similar size to the subject land but within the main Marshall Street business centre had been valued in the range of $158 to $213/m². Existing development of land on the southern Callandoon Street frontage indicated to Mr Cowley that the business centre commercial influence extended into that street, although the applied values were significantly lower. Land immediately adjacent and in close proximity to the subject site had been valued at $59/m² and although Mr Mildner held the opinion that those valuations were also too high, he agreed that the relativity relationship with the valuation of the subject land was not unreasonable. Mr Mildner pointed out that land opposite the subject to the east with similar access to the subject was valued also at $59/m². He believed that such a valuation supported the appellant’s estimate of the value of the subject land. (Mr Cowley was able to inform the Court that the lower level of valuation applied to that land to the east was caused by a mixed and overall inferior zoning situation.)
Mr Cowley was of the opinion that the central business area of the town extended westerly along Marshall Street from the McLean Street intersection with the hub of the business centre being around the Herbert Street intersection. It was Mr Mildner’s suggestion that the Council itself had identified the business centred extending easterly to Pratten Street through its parking limitations and the infrastructure supplied. Nevertheless Mr Cowley saw the block easterly of McLean Street particularly in the vicinity of Pratten Street as being properly described as fringe location business land just as was the subject property.
At the date of valuation Mr Cowley said there was no sales evidence which suggested to him that Marshall Street land near Pratten Street was closer in value to that of the subject land than the applied valuations suggested.
The overall information provided by Mr Cowley showed that two “Central Business” zoned sites both of similar area to the subject but neither with the commercial advantage of corner location, had been valued at $45/m² and $43/m² respectively. Both were developed as motel sites but Mr Cowley had been concerned more with potential for commercial development than the relative advantages or disadvantages of particular motel development. The relativity examples provided by Mr Cowley showed sharply decreasing values the further easterly the distance from McLean Street along Marshall Street.
Although Mr Cowley based his valuation on sales evidence, it is clear that the available evidence made comparison with fringe location commercial property a difficult exercise. It is reasonable that, if the same sales evidence was the basis of valuation of all fringe-located commercial land in the town, then a relativity argument is sustainable.
Prima facie the valuations of the two motel sites near Pratten Street, even on a pure commercial basis, appear to be overly conservative. It would be wrong then to adjust the valuation of the subject property merely to cause uniform error, if indeed those valuations were too low. From the fringe business location argument, it would seem more helpful to consider the valuations applied to lands, albeit with inferior access, within closer proximity to the McLean Street intersection. After consideration of the size of the subject land and the values applied generally in Marshall Street easterly of McLean Street, I am persuaded that some adjustment to the valuation of the subject land is appropriate and would provide the benefit of any doubt to the appellant.
A valuation based on $65 per m² would be seen as some acceptance of the arguments of both parties, whilst not causing too much impact on overall relativity, even the smaller sites in Callandoon Street.
The appeal is allowed, the valuation of the chief executive set aside and the unimproved value of the subject land determined in the rounded amount of $131,500.
RE WENCK
MEMBER OF THE LAND COURT
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