For more than 60 years, Rabin has been a family-held
industrial auction and real estate investment company, with a focus on the
acquisition and sale of industrial equipment and facilities around the
world. This is the first of a blog
series that defines common terminology used by the industry.
Our information comes from the American Society of Appraisers. ASA states that the following definitions are
the starting point for terms that are based in standard appraisal theory. Furthermore while they “provide the
fundamental value concepts; they are not the only acceptable definitions, since
contracts or jurisdictions may dictate somewhat different philosophies.” The ASA definitions are as followed:
·
Fair
Market Value - An
opinion expressed in terms of money, at which the property would change hands
between a willing buyer and a willing seller, neither being under any
compulsion to buy or to sell and both having reasonable knowledge of relevant
facts, as of a specific date.
·
Reproduction
Cost New - The cost of reproducing a new replica of a property on the basis of
current prices with the same or closely similar materials, as of a specific
date.
·
Replacement
Cost New - The current cost of a similar new property having the nearest
equivalent utility as the property being appraised, as of a specific date.
·
Orderly
Liquidation - An opinion of the gross amount, expressed in terms of money, that
typically could be realized from a liquidation sale, given a reasonable period
of time to find a purchaser (or purchasers), with the seller being compelled to
sell on an as-is, where-is basis, as of a specific date.
·
Forced
Liquidation Value - An opinion of the gross amount, expressed in terms of
money, that typically could be realized from a properly advertised and conducted
public auction, with the seller being compelled to sell with a sense of
immediacy on an as-is, where-is basis, as of a specific date.
As leading industrial and commercial liquidators, Rabin has sold
equipment assets in every trade sector and on almost every continent. Our professional asset appraisal services
provide an essential starting point for any asset-based lending or disposition
process.
At Rabin, our professional machinery
and equipment appraisal team has been working together for more than 25
years—gaining extensive experience in nearly every facet of industrial
equipment. Our seasoned appraisers have completed hundreds of reports,
providing our clients with real-world obtainable value conclusions. Please contact us to learn more about our
comprehensive services.
Source:
Machinery & Technical Specialties Committee of the American Society
of Appraisers, July 25, 2010
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