Case Study Flashcards
Which rental, did you treat with less waiting and why?
61 to 60 to Berners Street
It was in Fitzrovia;
Their had been more rental growth from Q3 23 and Q1 224 than Q4 23 and Q1 24 (10% vs 2%)
What are the reasons why you used the comparable method?
Owner occupiers would pay the best price for the property (enough of them in the Soho market)
Owner occupiers are price per sq ft driven in pricing
There are lots of assumptions involved in valuing a vacant property using the investment method
Why is there such a range in terms of rent free?
Carnaby Street was larger than subject
Noel Street was fitted
Agents explained that there was a lot of supply in the market and landlords were achieving a more favourable went three times
Agents explains that 6 months was achievable - 3 months incentive and 3 months fitout
This was supported by other evidence I had regard for
Why did you adopt a fixed rate for upper floors but not the basement
Likely to be single occupied, meaning tenants would look at overall basis, rather than floor by floor
Basement is not proper usable, office, space, unlike upper floors. It is market practice to discount.
What are different reversionary yields, pulling through in summary valuation
(MAIN RY) 5.2% is based on Net Before Fees
4.8% is based on Gross Value
Why is the net initial yield, 0% rather than negative?
Because empty rates are included as capex rather than opex
Appreciate there is different approaches valuers take with this
Why was capex assumed for a refurb?
To attract a tenant
Curtis modelling refurb costs be considered a special assumption
No, it is fair and reflecting the best price achievable by securing strongest market rent
Where did you measure to when taking check measurements?
Measured to the internal face of perimeter walls
What was the ground floor like?
Very similar to upper floors
No dedicated reception, space but some space that could be carved out for one
Did you apply capex to comps?
Yes, devalued, using the same process a valuation
Did not apply to Hobart Place though, as had been recently refurbished
Why did you use the equivalent yield?
This is how investors in the market would value the property
Was 26 Brook Street a retail property if so was it comparable
Spoke to investment agency team who had monitored the deal
Informed me that it was bought with the intention of using ground floor as retail and above as office
When I modelled the deal in AE, I found that only a small proportion of income would derive from retail - 5% of income
Concluded that its location (10 minute walk in a straight line from the) meant it was still comparable
Did you check weather report on title was correct?
Yes, checks on land registry to look at properties ownership
Why did you not use insurance as a void cost?
It is not JLL practice to do so, because insurance costs in the market are too variable
Why did you delay business rates by three months?
If it sold and became VP, you would get a three month grace period coming in as a new owner of vacant property
Remember this is for investment method (seeking a tenant)
How long has the client owned the property?
Since 2014
Did the client have any plans for the building?
No specific business plan had held owner occupied since they bought the building
Why 12 months void?
Based on market dynamics
Light touch refurb plus reletting on open market
Why is the top floor much smaller?
It is set back, reducing usable space (from the rear)
What could explain the ground floor being bigger than the other upper floors?
Smaller hallway
No WC
Did it have Aircon?
Basic ‘comfort cooling’, which was similar to comps
What do you get with period buildings like Great Marlborough Street?
Small landings and limited communal areas
What is your comments on the ground rent for Hobart Place?
Fairly onerous given lot size but accounted for in valuation
