For the purposes of illustrating how an income approach might be used to develop the value of the real property component of a casino going concern, this article will use a market comparison approach
with an EBITDA (debt-free) multiplier, and then apply an allocation based on a percent of the total represented by the real property contribution.
While British valuers, who influence appraisal in many parts of the world, do not generally confine their appraisal analyses confine their appraisal analyses analyses to only three approaches, they do tend to focus as well on appraisal concepts and methods that are related to the cost approach, the market comparison approach
, and the income approach.
At the outset, the market comparison approach
seems suitable, but Czechoslovak appraisers cannot use statistical methods because of the lack of sufficiently large data samples for comparison.
Omni's appraiser testified that he used only the income approach to valuation in his appraisal; he found that the cost and market comparison approaches
were inappropriate because of the building's unique character and the lack of comparable sales within the area.