Did College of Western Idaho overpay for the West End property?

May 26, 2015 - PRLog -- Last month, the College of Western Idaho entered into a purchase agreement for 10 acres at the corner of Whitewater Park Boulevard and Main Street in Boise's West End. The question on everyone's minds now is did they overpay for the site? The dilemma comes from the vast difference between the property's assessed value of $3.6 million and the purchase price of $8.8 million. The college has been criticized for not ordering a property appraisal prior to entering into the purchase and sale agreement.

According to Michael Ballantyne, managing member at Thornton Oliver Keller, that criticism for a lack of an appraisal is unfounded. Most buyers do not seek appraisals prior to placing properties under contract. That step is saved for the due diligence period, which in the case of College of Western Idaho is a pretty typical 180 days. During that time, buyers oftentimes conduct environmental reviews, property surveys, title searches, and appraisals. If the buyer has found unfavorable items during this review period, they may elect not to go forward with the transaction.

Is the property worth $8.8 million? We will likely find out once the appraisal is completed. But one item to keep in mind is the limited availability of properties of this size in or near downtown Boise. Currently, only 2 other properties are on the market in this area between 8 and 12 acres. Whether or not the College of Western Idaho will move forward with purchasing this 10-acre piece at the current purchase price will remain to be seen. More should be known at the end of their 180-day due diligence period.

*Note: Thornton Oliver Keller was not involved in the College of Western Idaho land purchase.