Did Cherry Hill Overpay?

From the Courier Post

Price of property questioned

Two appraisals of a 44-acre property Cherry Hill bought earlier this year for preservation valued the land at substantially less than the $8.3 million the township paid for it.

Township records also show the appraisals weren’t finished until after the municipality purchased the property from K. Hovnanian Homes on March 17.

Mayor Bernie Platt, who headed the effort to buy the forested land, said the township didn’t discuss appraisals with K. Hovnanian because the developer would never have sold the property for what it paid for it.

K. Hovnanian bought the land, which sits next to Rosa International Middle School on Browning Lane, for $5.72 million on March 17, then sold it to the township that same day. K. Hovnanian invested about $1 million in trying to get township approvals to build 37 single-family homes, the mayor said.

The appraisals came in at $5 million and $6.1 million on April 18, according to records. Todd & Black Inc. of Cherry Hill and Lee L. Romm Inc. of Marlton performed the appraisals.

“Most of the residents in this township want to see this type of land preserved,” Platt said. “We have to protect the ground we have left. The one thing you cannot do is manufacture ground.”

But political observers counter that municipalities should get appraisals done before a property purchase because it better prepares them for negotiations.

“It is possible that Hovnanian would not have taken less than $8 million and not have agreed with the appraisals’ evaluations, but from a citizen’s point of view, the reason you do appraisals is so you can negotiate a price based on the market,” said Ingrid Reed, a policy analyst with Rutgers University’s Eagleton Institute of Politics.

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