all Flashcards
What are the four principles of the O’may vs London Real Property Co 1982
Landlord must have a valid reason on estate management grounds
Changes made must be compensated by a change in rent
Changes must not materially affect the tenants security of tenure
it must be reasonable.
what happened in S.Frances Ltd v The cavendish hotel Ltd 2017?
Court initially held that a landlord is entitled to refuse the grant of a new business tenancy on grounds of redevelopment where redeveloping is devised from the eviction of the tenant
Supreme court allowed the appeal in 2018 in favour of the tenant meaning the landlord had to prove intention to carry out the works.
subsequent judgement relating to rent - and the interim rent to be determined.
The judgement reflects the effects of Covid-19 on rents and the necessity to value a year-to-year tenancy as required by the act as a starting point for interim rent.
What are the different investment methods
Conventional - passing rent or market rent X Years purchased = Market Value
Term and reverion - used for under rented properties -
Term capitalised until expiry or next review at an initial yield
Reversion to market rent valued into perpetuity at a reversionary yeild.
Hardcore/ layer - used for over rented properties
Top slice = Passing rent less market rent until next lease event
Bottom slice = Market rent
DCF - Growth explicit investment method used to project estimated cash flows
Estimate the cashflow (income less expenditure)
Estimate the exit value at the end of the holding period
Select discount rate
Discount cash flow at discount rate
Value is the sum of the completed cashflow to provide NPV
How do is the GDV calculated
Total Market rent x Yp in perp @ ARY less fees
