Brother Of Jerry
Date: October 02, 2010 10:46AM
What number gets reported depends on what is included in the definition by the person writing the article, and what costs are included/excluded.
This happens all the time. You buy a house for $400,000. With closing costs, $420,000. With interest over 30 years, $1,300,000. With costs to furnish and landscape, add $60,000. Then there are real estate taxes over 30 years, utilities, upkeep, replacement of water heaters, furnaces, roofs, etc, savings on rent, decreasing the cost, opportunity costs of not having the cash to invest in other things. So, what should get reported as the actual cost of the house?
Meanwhile, the person who sold it got $400,000. Minus real estate commission. Minus other closing costs. Minus the costs of moving. Minus the costs of home improvements. Minus the original purchase price. Minus the mortgage payoff.
So, for neither side was this anything even close to a $400,000 transaction, but that is what generally would be reported as the value of the house.
The cost or value of something, especially a large project, is exceedingly problematic, unless parameters are set very precisely as to what is being talked about.
In the case of City Creek, there are a number of other buildings going up or planned that could be included or excluded in the scope of the overall project, complicating cost estimates even more. This isn't just apples and oranges. It is the entire produce section.