Houston Condemnation Appraisals – Don’t Take Lowball Offer

The O’Connor team strives to ensure that its clients get fair and equitable treatment. Property owners are well-advised to proceed with caution when approached by condemning authorities. In condemnation actions, the rights of condemning authorities are broad and virtually limitless. They can take property for public use or even for private use (to facilitate assemblage of individual properties). In some cases, condemning authorities start off with a below-market offer and slowly escalate offers at each step in the process (initial offer, commissioners court, subsequent to following suit and at courthouse steps).

Most condemnation actions take only a portion of the property (referred to as “part taken”). The balance of the subject property is referred to as “the remainder.” The market value of the part taken is typically not a source of meaningful contention. However, the damages to the remainder is generally a highly contentious matter. (Damages to the remainder refers to the diminution in market value for the property not taken through condemnation.) Consider the following examples:

• Condemning authority takes 1 acre of a 4-acre retail center. However, this 1-acre parcel comprised 40% of the center’s parking.
• Condemning authority takes 90% of a site, including the office building. The remaining site is too small to allow any improvements

Appraisers often reach markedly different conclusions regarding the damages to the remainder. Preparing a credible condemnation appraisal consistent with factual data generally encourages an equitable settlement.