IN THE COURT OF APPEALS OF IOWA

No. 21-0258

Filed January 12, 2022

WEST DES MOINES HOTEL ASSOCIATES, LLC,

Plaintiff-Appellant,

vs.

DALLAS COUNTY BOARD OF REVIEW,

Defendant-Appellee.

________________________________________________________________

Appeal from the Iowa District Court for Dallas County, Michael Jacobsen, 

Judge.

West Des Moines Hotel Associates, LLC challenges the Dallas County 

Board of Review’s 2019 assessment of its West Des Moines hotel property.

AFFIRMED.

Sarah K. Franklin and Deborah M. Tharnish of Dentons Davis Brown PC, 

Des Moines, for appellant.

John E. Lande and William R. Stiles of Dickinson, Mackaman, Tyler & 

Hagen, P.C., Des Moines, for appellee.

Heard by Greer, P.J., Badding, J., and Carr, S.J.*

*Senior judge assigned by order pursuant to Iowa Code section 602.9206 

(2022).
2

CARR, Senior Judge.

West Des Moines Hotel Associates, LLC (“Associates”) challenges the 

Dallas County Board of Review’s approval of the 2019 assessment of the West 

Des Moines Marriott (“Hotel”). The district court affirmed. On appeal, Associates 

contends the court erred in determining the Board met its burden to prove the 

property was not over assessed, highlighting the 2017 sale price and declining 

performance of the Hotel. Associates also asserts the court should not have 

credited the local board of review’s appraiser, claiming he wrongly relied on 

national market data and improperly calculated the value of or misclassified recent 

improvements to the property.

Having considered the record evidence, testimony of the witnesses, and the 

respective drawbacks of each appraisal, we conclude the Board has met its burden 

to prove its valuation of the Hotel as of January 1, 2019, for $18,434,100 is not 

excessive. We affirm.

I. Background Facts and Proceedings.

This case is a property tax appeal of the county assessor’s 2019 

$18,434,100 valuation of the Hotel. Associates filed a timely protest with the Dallas 

County Board of Review (“Board”), claiming the valuation was excessive and 

asserting the market value was $15,000,000. The Board denied the protest.

Associates appealed to the district court.

In the district court, Associates maintained the correct value of the property 

for the 2019 assessment year is $13,870,000. The Hotel was originally 

constructed in 1974 and is located at 1250 Jordan Creek Parkway, West Des 

Moines, Iowa. It is a full-service hotel and convention center, with conference and 
3

banquet facilities, a restaurant, lounge, and an indoor pool. The Hotel is nine 

stories’ tall, has 219 guestrooms, and has a gross building area of 160,096 square 

feet.

In July 2017, Associates, of which Kinseth Hospitality is the majority owner, 

purchased the property for $19,000,000, with an immediate return to Associates 

of $1.25 million labeled on the closing statement as “transferred FF&E cash”—

FF&E meaning furniture, fixtures, and equipment. The sale was an arms’ length 

transaction between a sophisticated buyer and seller. The purchase price included 

the land, hotel, other improvements, personal property, licenses and permits, and 

all FF&E. The warranty deed declares a $17,750,000 purchase price and FF&E

of $3,840,000 categorized as personal property.

The Hotel is a Marriott franchised property. With its purchase, Associates 

paid $150,000 to secure transfer of a Marriott franchise agreement that calls for an 

$11 million property improvement plan (PIP) for ongoing maintenance, required

replacement of FF&E items, and refreshment of Hotel décor. The PIP anticipated 

a twenty-four month completion date. Between the purchase date and the January 

1, 2019 valuation date, Associates spent approximately $2.1 million on property 

improvements and an additional $300,000 on deferred maintenance items related 

to air pressure issues and other site improvements.

Don Vaske of Frandson & Associates, L.C., is a certified general real 

property appraiser. Associates employed Vaske to appraise the Hotel for its 

appeal of the 2019 tax assessment. Vaske employed three approaches to assess 

the value of the property—the sales-comparison approach, cost approach, and

income approach. Under the sales-comparison approach, Vaske determined the 
4

market value of the Hotel as a going concern was $17,739,000; under the cost

approach, the value was $17,720,000; and under the income approach, the value

was $16,400,000. He then made adjustments and allowances and arrived at final 

appraised value for the Hotel of $13,870,000.

Mark Kenney of American Valuation Group, Inc., is a certified general real 

property appraiser employed by the Board for this appeal.

1 Kenney employed the 

sales-comparison and income approaches to assess the value of the property. He 

determined the cost approach was not applicable. Kenney determined the market 

value of the Hotel under the comparison-sales approach was $20,800,000 and 

under the income approach the value was $21,400,000. After reconciliation,

Kenney arrived at an appraised value for the Hotel of $21,100,000.

Bruce Kinseth of Kinseth Hospitality testified about the negotiations of the 

purchase and ongoing operation of the Hotel. Kinseth testified a franchise adds 

value to any hotel and “when you can affiliate with a Marriott . . . one of the top-tier 

brands, it adds tremendous economic value. You get the business from Marriott. 

Marriott Rewards Members are a humungous traveling public, as well as they pay 

higher rates than your run-of-the-mill driver down the interstate.” Kinseth testified 

 

1 Vaske also conducted the appraisal of the Hotel for Associates’ 2018 appeal and 

Kennedy conducted the Board’s appraisal. 

The 2018 appeal involved the tax appeal relating to the 2017 revaluation of 

the Hotel at an assessment of $17,956,710. Issues included the recent sale of the 

subject property, sufficiency of comparable sales, derivation of FF&E value, 

appropriate overall capitalization rate selection, impact of the PIP, and absence or

existence of intangible asset value. On January 28, 2019, the Property 

Assessment Appeal Board issued a decision ruling that the assessment was 

affirmed. Associates did not further appeal, though it was notified it could do so.
5

Associates felt “good about the price that we got” at the time of the purchase but 

“clearly we overpaid.” 

Kinseth testified Hotel performance after the purchase “went down”; “our 

occupancy and average daily rate went down and our overall revenue went down

about five percent per occupied hotel room.” Kinseth observed the revenue per 

available room is the “real driving number” in Smith Travel Research Reports—the 

STAR report—which is relied upon in the hotel industry for “any market-based 

decision.” He stated he had “never seen an appraisal done that doesn’t have the 

most recent STAR report.” He criticized Kenney’s appraisal for not including the 

STAR Report information about the Hotel’s local competitors. Kinseth disagreed 

with Kenney’s appraisal value and, though the original protest stated the true value 

was $15 million, he agreed with Vaske’s $13,870,000 appraisal for the Hotel’s real 

property.

The district court concluded the Board had proved the assessment was not 

excessive. The court explained:

In 2017 [Associates] obtained a mortgage against the [Hotel] from 

West Bank in the amount of $26,000,000. West Bank obtained an 

appraisal from certified appraiser Ranney Ramsey [of Nelsen 

Appraisal Associates, Inc.] Ramsey concluded that the [Hotel]’s 

value was $18,340,000 as a going concern. Ramsey also projected 

that the [Hotel]’s market value at completion of [PIP] construction, as 

a going concern, would be $30,845,000 in September of 2019.

Ramsey’s valuation of the [Hotel] is consistent with the assessed 

valuation and Mr. Kenney’s final valuation of $21,100,000. As [the 

Board] has pointed out West Bank had no reason to overvalue the 

[Hotel], because the property secures West Bank’s lending.

The court also rejected Associates’ claim that any value of the Marriott 

franchise should be excluded. The court observed the franchise was one of the 

reasons Associates was interested in purchasing the Hotel as a going concern.
6

The court concluded:

Mr. Kenney’s valuation of the [Hotel] is more persuasive and 

consistent with the offered evidence at trial. Mr. Kenney’s assigned 

value for the FF&E is supported by his testimony and the prior 

appraisal by Ramsey. Mr. Kenney properly considered the fact that

the [Hotel] is a Marriott Franchise which is its present use as a 

commercial hotel property. Finally, Mr. Kenney’s comparable sales 

approach used appropriate recent sales, within the area of the 

[Hotel], adjusted to the size of the [Hotel]. Taking all of Mr. Kenney’s

valuation calculations along with adjustments, allowances and 

applied capitalization rate his final value of the property is more 

persuasive and consistent with the evidence offered at trial. In fact, 

Mr. Kenney’s expressed value of the [Hotel] for tax year 2019 is 

actually higher than the assessment. Defendant Board of Review 

met its burden of proof to uphold the valuation for assessed value 

($18,434,100) of the property for tax year 2019. The assessment

must therefore be affirmed.

Associates appeals. 

II. Scope and Standard of Review. 

Our standard of review is de novo. See Compiano v. Bd. of Rev., 771 

N.W.2d 392, 395 (Iowa 2009). We give weight to the district court’s fact-findings, 

especially with regard to witness credibility, but are not bound by them. Soifer v. 

Floyd Cnty. Bd. of Rev., 759 N.W.2d 775, 782 (Iowa 2009).

III. Discussion.

As an initial observation, our supreme court has recognized: “The valuation 

of property has never been an exact science. In colonial times valuing property 

was known as the ‘rule of common estimation.’ Although valuation for tax 

purposes is necessarily expressed in quantitative terms, the appraisal process has 

never been and is not now a mathematical exercise.” Wellmark, Inc. v. Polk Cnty. 

Bd. of Rev., 875 N.W.2d 667, 672 (Iowa 2016) (internal citation omitted). 
7

A. General Principles Applicable to Assessment Proceedings. All nonexempt real property is subject to taxation. See Iowa Code § 427A.1(1) (2019). 

Pursuant section 427A.1(c), for property taxation purposes, the following are be 

taxed as real property: “Buildings, structures, or improvements, any of which are 

constructed on or in the land, attached to the land, or placed upon a foundation 

whether or not attached to the foundation.” Also, “[b]uildings, structures, 

equipment, machinery, or improvements, any of which are attached to the 

buildings, structures, or improvements.” Id. § 427A(1)(d). For purposes of this 

statutory provision, “attached” means any of the following: “[c]onnected by an 

adhesive preparation,” ”[c]onnected in a manner so that disconnecting requires the 

removal of one or more fastening devices, other than electric plugs,” or 

“[c]onnected in a manner so that removal requires substantial modification or 

alteration of the property removed or the property from which it is removed.” Id.

§ 427A.1(2). However, “property is not ‘attached’ if it is a kind of property which 

would ordinarily be removed when the owner of the property moves to another 

location.” Id. § 427A.3. Black’s Law Dictionary defines the term “fixture” as “an 

article in the nature of personal property which has been so annexed to the realty 

that it is regarded part of the land.” Thus, unless otherwise exempt, fixtures are 

taxed as real property. See, e.g., Stateline Coop. v Iowa Prop. Assessment Appeal 

Bd., 958 N.W.2d 807, 813–16 (Iowa 2021) (discussing exemption under section 

427A.1(e), “machinery used in manufacturing establishment”).

For taxation purposes, property is assessed at its “actual value,” meaning 

“the fair and reasonable market value.” Iowa Code § 441.21(1)(a), (b). “Market 

value” means “the fair and reasonable exchange in the year in which the property 
8

is listed and valued between a willing buyer and a willing seller.” Id.

§ 441.20(1)(b)(1). “Sale prices of the property or comparable property in normal 

transactions reflecting market value, and the probable availability or unavailability 

of persons interested in purchasing the property, shall be taken into consideration 

in arriving at its market value.” If assessors cannot readily establish the value of 

the property by this method, they

may determine the value of the property using the other uniform and 

recognized appraisal methods including its productive and earning 

capacity, if any, industrial conditions, its cost, physical and functional 

depreciation and obsolescence and replacement cost, and all other 

factors which would assist in determining the fair and reasonable 

market value of the property but the actual value shall not be

determined by use of only one such factor.

Id. § 441.21(2).

2

The burden is on the taxpayer to prove one of the statutory grounds for 

protest by a preponderance of the evidence. See id. § 441.21(3)(b)(2) (“For 

assessment years beginning on or after January 1, 2018, the burden of proof shall 

be upon any complainant attacking such valuation as excessive, inadequate, 

inequitable, or capricious. However, in protest or appeal proceedings when the 

complainant offers competent evidence that the market value of the property is 

different than the market value determined by the assessor, the burden of proof 

thereafter shall be upon the officials or persons seeking to uphold such valuation 

to be assessed.”); see Compiano, 771 N.W.2d at 398 (“Evidence is competent

 

2 The approved approaches to valuation include the “cost approach,” “sales 

comparison approach,” and “income approach.” Iowa Dep’t of Revenue, Iowa Real 

Property Appraisal Manual 1-2–1-3 (2020), 

https://tax.iowa.gov/sites/default/files/2020-01/Introduction.pdf (last visited 

11/29/2021).
9

under the statute when it complies ‘with the statutory scheme for property valuation 

for tax assessment purposes.’” (citation omitted)).

B. Burden to Uphold the Assessment. Associates spends considerable 

argument on the district court’s initial ruling, which misstated the burden of proof. 

However, the court filed an amended ruling following Associates’ Iowa Rule of Civil 

Procedure 1.904(2) motion. In any event, we recognize the burden rested with the 

Board to uphold the valuation assessed. See Iowa Code § 441.21(3)(b)(2). “[A]nd 

in our de novo review, that is where we place it.” Ross v. Bd. of Rev. of City of 

Iowa City, 417 N.W.2d 462, 465 (Iowa 1988).

Associates contends the Board did not meet its burden because Kenney’s 

appraisal “contains serious flaws and is not reliable.” First, Associates argues 

Kenney selected poor comparable sales and made unsupported adjustments. 

Associates primarily focuses on its complaint that Kenney did not consider the sale 

of the Hotel in his comparable-sales analysis. While Kenney did not use the sale 

of the Hotel to Associates as a “comparable sale,” it is clear Kenney did consider 

the sale in his analysis. 

Kenney’s appraisal report summarized the ownership and property history 

as follows:

As of the valuation date of January 1, 2017, the property rights 

being appraised were held in the ownership of IA Lodging West Des 

Moines, LLC, an affiliate of Xenia Hotels & Resorts a publicly-traded 

Real Estate Investment Trust (REIT). The current owner received 

legal title to the [Hotel] by a deed dated April 10, 2010 and recorded 

in Deed Book 2010, Page 56 I 2. Consideration at that time was 

$18,070,000 ($82,511 per room). This transfer was the purchase of

the [Hotel] for continued hotel operation and use. We are not aware 

of any transfers of the [Hotel] within three years prior to the date of 

this valuation. To the best of our knowledge, the [Hotel] is not 

currently under agreement of sale, option, or listing to sell.
10

Sale of the [Hotel]

The [Hotel] did sell soon after the valuation date. A Lodging 

West Des Moines, LLC sold the [Hotel] to West Des Moines Hotel 

Associates, LLC (as to an undivided 62.73% interest), GDA 

Investments, LLC (as to an undivided 15.15% interest), and 

S.DUB124, LLC (as to an undivided 13.94% interest), all buyers c/o 

Kinseth Hotel Corporation of North Liberty, IA. This transfer was 

recorded on July 12, 2017 as recorded in Deed Book 2017, Page 

13391. According to this deed and [declaration of value], the total 

consideration was $13,874,000 ($63,352 per room), with an 

allocated consideration for personal property of $3,840,000 ($17,534 

per room), and a remaining consideration for real property only of 

$10,034,000 ($45,817 per room).

According to the subject’s Purchase And Sale Agreement 

dated April 27, 2017 and the First Amendment to Purchase and Sale 

Agreement dated May 31, 2017 (see Appendix C), the original

agreed purchase price of $19,500,000 was reduced by the First 

Amendment to $19,000,000 ($86,758 per room), including the land, 

improvements, personal property, licenses and permits, contract

rights/intangible property and transferred FF&E cash, but excluding 

all Excluded Assets identified in Section 2.2. The purchase price 

shall be allocated among the Property, goodwill and franchise rights, 

Personal Property and Transferred FF&E Cash for federal income 

tax purposes under Section 1060 of the Internal Revenue Code by 

Consultant (defined as Ryan). According to Ryan’s Acquisition Price 

Allocation—Valuation Summary Report (see Appendix D), the 

subject’s tangible personal property was estimated at $1,510,000, or 

$6,895 per room (see Pages 4 of 19 and 10 of 19).

. . . .

According to the Final Settlement Statement ( see Appendix 

E), the total consideration was $19,000,000 ( consistent with the First 

Amendment purchase price and represents $86,758 per room) with 

an FF&E cash account buyer credit of $1,250,000, which generates 

a net purchase price of $17,750,000 ($81,050 per room), and 

includes a mortgage loan amount of $13,687,500 ($62,500 per room 

and a 72.0% Loan-to-Price ratio).

. . . .

[Hotel] Mortgage Appraisal

A mortgage loan appraisal supporting the mortgage provided 

was prepared by Nelsen Appraisal Associates, Inc. for West Bank, 

dated May 31, 2017, with a “Market Value As Is–Ongoing Concern”

as of May 9, 2017 of $19,600,000 ($89,498 per room), including 

allocations for “Real Estate–As Is” of $18,340,000 ($83,744 per 

room), “Intangible Property–As Is” of $700,000 ($3196 per room), 

and “Personal Property–As Is” of $560,000 ($2557 per room). In 

addition, this appraisal provided “Market Value at Completion of 

Construction–Ongoing Concern” of $30,845,000 ($140,845 per 
11

room) as of September 2019 and “Market Value As Renovated &

Stabilized–Ongoing Concern” of $32,000,000 ($146,119 per room) 

as of September 2021.

Kenney’s appraisal analyzes the Hotel’s surrounding area and traffic and 

concludes the hotel is in an “excellent location.” Also considered was the “unique 

zoning of this project,” providing “a special value enhancement which was 

established through the efforts of and paid for by the developer, but adheres to the 

[Hotel] and benefits the present subject.” Kenney determined the highest and best 

use of the [Hotel] is “for ‘continued’ full service hotel use utilizing the existing 

improvements.” 

Kenney’s appraisal noted, “The property sold in July 2017, and the buyer 

(present property owner noted above) plans to undertake a $11.5 mil. Planned

Improvement Program (PIP) renovation. This project was progressing in 2018, 

with approximately $2.9 mil. having been spent.” Kenney testified that because 

this was the “subject property,” he selected five other hotel sales for his 

comparable-sales analysis, all located in the Des Moines metropolitan area. 

Kenney explained his reasons for including each hotel in his valuation analysis and 

the bases for his adjustments. Based on Kenney’s analysis, he arrived at a perroom value of $95,000, or a comparable-sales value of $20,800,000 for the Hotel.

Associates criticizes Kenney’s failure to consider the declining performance 

of the Hotel or explain how the valuation could increase while performance 

decreased. The Board suggests an alternative explanation for the declining 

performance of the Hotel may be found in Associates’ management decisions. 

Vaske’s appraisal shows that after Associates acquired the property fees paid to 

hotel management have increased and money spent on marketing has been cut 
12

in half. In addition, the Hotel requires $11 million of improvements under the PIP, 

but less than $3 million has been spent on the property. Notwithstanding Kinseth’s 

testimony to the contrary, the FF&E was at or near the end of its life when the 

property was acquired in 2017 and the PIP—a condition of the Marriott franchise—

required, among other things, replacement of beds and other “soft goods” in the 

guest rooms. All improvements were anticipated in be completed within twentyfour months. Associates does not explain how, despite the more than $2 million 

in expenditures on the Hotel, its value declined.

We observe there are flaws in each appraisal. Kenney’s appraisal 

misallocates about $450,000 of the $2.9 million of capital expenditures as real 

estate improvements. Vaske’s appraisal does not account for the effect of a PIP

on one of his comparable sales (the downtown Marriott sale was subject to a $20 

million PIP or $48,000 per room), which he acknowledged in his testimony could 

have a downward pressure on the sale price. Kenney allocated a thirty percent 

upward adjustment to the downtown Marriott sales, recognizing the impact the PIP 

had. Vaske’s valuation of the Hotel did not include the expected $11 million PIP, 

which was to be completed within twenty-four months of the July 2017 sale.

Here, with respect to the income approach both Kenney and Vaske first 

determined a net operating income. Kenney found a stabilized income was 

$2,381,006; Vaske found a stabilized income of $2,287,445. However, the two 

appraisers utilized different capitalization rates.3 Kenney used a capitalization rate 

 

3 As explained in Kenney’s report, 

This net income stream is capitalized into value by using an overall 

rate based on competitive returns in the mortgage and equity 

markets. The conclusion regarding the expected equity return for the 
13

of 11.80%, leading to value of $21,400,000; Vaske used a capitalization rate of 

13.95%, leading to a value of $16,400,000.

Associates argues the Board erred in relying on national market data to 

determine the capitalization rate. Vaske testified that using national market data 

was an “apple-and-orange” comparison. However, Kinseth (the majority owner of 

the Hotel) and Marriott are national in scope. Kinseth owns or manages hotels in 

twelve states. And the market for large, full-service hotels such as the subject 

property is national. It is not unreasonable for Kenney to consider the national 

market in determining the capitalization rate.4

 

subject property and typical existing mortgage terms are combined 

in order to develop an overall capitalization rate (OAR).

4 The Nelsen appraisal for the mortgagor explained [app1206]:

An additional survey from CBRE—1stHalf, 2016 provides 

capitalization data by metropolitan TIER. The Des Moines area 

would be probably in the lower end of the TIER III [e.g., San Diego, 

Minneapolis, Atlanta, Oakland, Philadelphia, Phoenix, Dallas/Fort 

Worth, San Jose, Houston] with capitalization rates ranging from 

8.25% to 8.30% for a stabilized property.

Several investment attributes were considered while selecting 

an overall cap rate (Ro). Again, Ro is used to convert the subject’s 

net operating income (NOI) into value. Investment attributes affect 

risk, which is major factor in the selection of an appropriate cap rate. 

When risk is low, a commensurate cap rate should be low, and vice 

versa.

All issues necessary to produce a value indication via the 

income approach were presented and explained. After careful 

consideration of all factors pertaining to and influencing this 

approach, the following formula capitalizes or converts net income 

into value.
14

A central bone of contention here is the value of the FF&E. Kenney’s 

appraisal used the mortgagor’s $560,000 figure for the FF&E in 2017, and then 

considered the amount spent under the PIP:

Present Use & Planned Renovation

As of the valuation date, the [Hotel] was partially occupied, 

operated and utilized as a full service Marriott Hotel. According to 

Rodney Carmichael, Engineering Manager for the [Hotel], 

renovations in accordance with the Planned Improvement Plan (PIP) 

of $11,500,000 ($52,511 per room) were beginning on our prior 

inspection date of April 23, 2018, and were expected to be completed 

by mid-2020 (see complete PIP as “Exhibit H” of Purchase And Sale

Agreement in Appendix C). In 2018, the PIP was underway with $2.9 

mil. having been spent (see Appendix K). Our breakdown of 

renovation construction costs between real estate and furniture,

fixtures and equipment (FF&E) are presented in the Improvements 

section of this report. Of the total figure, $2,347,719 was for real 

estate construction improvements, and only $550,860 was for

Furniture, Fixtures & Equipment (FF&E).

Adding $550,860, Kenney valued the FF&E at $1.1 million. He testified his value 

assumed a ninety percent depreciation rate because the FF&E was getting close 

to the end of its useful life.

For his part, Vaske’s appraisal addresses FF&E:

Based on discussions with representatives for the subject 

concerning the subject FF&E, the subject property had all new “case 

goods” (excluding beds) installed in the guest rooms in 2012. The 

conditions of the beds are assumed to be near the end of their

economic life. The furniture, fixtures, and equipment within full 

service hotels with convention facilities, including full kitchen, bar, 

dining, and banquet/conference meeting space, typically has an 

economic life of 10 to 15 years. Considering the age and overall 

condition of the subject’s FF&E (as of January 1, 2019), depreciation

attributable to the FF&E is estimated at 60%. This indicates a 

depreciated cost for the FF&E of $2,628,000.

When asked how Associates arrived at the 2017 declared FF&E value of 

$3,840,000 million, Kinseth testified:
15

Well, I think—you know, if you just sit down and add up 219 rooms 

times the amount of FF&E and the 38 additional parlors, suites. Then 

you go down and say, Okay, there are ten offices, all with desks, all 

with computers, all with side chairs. Then you go into the restaurant 

and count the tables, the chairs, the linen, the banquet linen, the 

silverware, all the banquet table types, the AV equipment that is 

sitting on the wall and the carts and the portable bars and all of the 

furniture in the pre-function area, all of the furniture in the lobby, the 

vans, all the computer systems, all of the TVs in the rooms, all of the

fitness equipment, you know, there is just a tremendous, tremendous 

amount of furniture and fixtures and personal property in there.

Kinseth agreed with counsel’s statement “$3.84 million divided by 219 rooms is 

about $17,500 per room” and noted that to “outfit a new hotel” would cost between 

$25,000 and $35,000 per room. Kinseth testified Kenney’s $1.1 million FF&E 

value was “laughable.”

On our de novo review,5 we agree with the district court when it observed:

One of the hotly contested facts in the trial was the value of the FF&E 

that is included in the purchase cost of the [Hotel]. [Associates]

contends the FF&E was worth at least $3,840,000 when [Associates]

purchased the [Hotel] in July 2017 for $19,000,000. Vaske found 

that the FF&E was $2,628,000 and Kenney valued the FF&E at 

$1,000,000 based partly upon the Ramsey appraisal which valued 

the FF&E at approximately $560,000 in 2017. Kenney did add 

approximately $500,000 in value to account for FF&E added since 

his previous valuation. The evidence suggests that the value of the 

FF&E is much closer to Kenney’s value than that of Mr. Vaske or 

[Kinseth]. Therefore, Mr. Vaske’s assigned value for FF&E is too 

high thus lowering the valuation of the [Hotel] which skewed his sales 

comparison approach to a lower value.

Vaske’s appraisal overestimates the FF&E. Additionally, he fails to account 

for the value of the Marriott franchise. Kinseth testified Associates would not have 

purchased the Hotel if Marriott was unwilling to continue the franchise. He stated 

 

5 Also in the record is an “Acquisition Price Allocation Valuation Summary Report” 

prepared by Ryan, LLC., which considered the “tangible personal property” 

acquired in Associates’ purchase had a value of $1,510,000. 
16

the Marriott franchise was of “[t]remendous value.” This is an appropriate 

consideration in the valuation process. See Soifer, 759 N.W.2d at 785 (“An 

assessor can ‘consider intangibles in arriving at the actual value of the taxable 

property’ provided the intangibles specified in section 441.21(2) are not 

considered.” (citation omitted)). As the Soifer court noted:

[V]aluing the Soifers’ property as if it were not a viable McDonald’s 

would be contrary to the principle that assessed property is valued 

based on its present use, including any functioning commercial 

enterprise on the property. In Riso [v. Pottwattamie Board of 

Review], this court held that an assessor is “entitled to consider the 

use of the [assessed] property as a going concern.” 362 N.W.2d 

[513,] 517 [(Iowa 1985)]; accord Maytag Co. [v. Partridge], 210 

N.W.2d [584,] 590 [(Iowa 1973)]; Lake City Elec. Light Co. [v. 

McCrary], 110 N.W. [19,] 20 [(Iowa 1906)]. As we stated in Maytag,

“[w]hen an assessor considers the use being made of property, he is 

merely following the rule that he must consider conditions as they 

are.” 210 N.W.2d at 590 (rejecting an expert’s analysis that valued 

machinery in use in the Maytag factory based on the used machinery 

market price).

759 N.W.2d at 788.

Having considered the record evidence, testimony of the witnesses, and the 

respective drawbacks of each appraisal, we conclude the Board has met its burden 

to prove its valuation of the Hotel as of January 1, 2019, for $18,434,100 is not 

excessive. We therefore affirm.

AFFIRMED.