Case Study Questions Flashcards
When did you receive the quote?
06 April 2023
When did you receive letter of instruction?
12 April 2023
When did you send the confirmation of instuction letter (COIL)?
14 April 2023
What was the date of valuation?
21 April 2023 - same date as inspection
When did you report to the client?
28 April 2023
What was contained within the Terms of Engagement?
- Client: Bank of Scotland
- Purpose: Secured lending purposes
- Interest to be valued: 1 x leasehold
- Type of Asset or Liability: trading as a Pharmacy
- Basis of Value: Market Value
- Valuation Date: date of inspection
- Disclosure of Material Involvement: no involvement within 24 months, independant and no conflicts of interest
- Identity of Valuer: Jamie Savage
- Confirmation of PI Cover
- Acting in capacity of external valuers
- Currency: GBP £
- Information Relied On: Client and any third party directed by client
- Publication: Limited to addressee
- Fee: £2,000
- Complaints Handling Procedure
What was the age and construction of property?
The building is of traditional stone construction under a pitched roof clad in slate dated back to probably the early 20th century.
The entrance is full height and width with roller shutter doors. The condition of the building is good with no signs of any material defects.
What source of errors are associated with using a laser measuring device?
- Human error – not using the device appropriately i.e. not measuring a horizontal distance
- Systematic error – devices should be regularly checked for accuracy of calibration by checking a known distance and recording the results in a log
What did you include / exclude from your NIA measurement?
I included everything to the internal face of the perimeter walls and excluded:
1. Structural columns
2. Toilets
3. Rear lobby and stairwell
What is the use class of the Property
Class 1A (Formerly Class 2 prior to 31.03.2023)
What is the rateable value?
£19,900
What is the EPC?
D
Expires: 2031
How did you rank the comparable evidence?
I had regard to recency, location, size of business and style of disposal
Where did you get the comparable evidence from?
Our own internal database
Did you inspect the roof of the property?
A visible inspection from the roadside which didn’t identify any material defects
What was the fee for the job and how did you decide on the fee level?
10% of the fee
What was the deal agreed?
£100,000
What information did you request from the Tenant?
Three years of accounts
What was your PI Cover?
TBC
Which comparable did you place most reliance on and why?
TBC
Why did you use the comparable method to value?
TBC
How big was the building?
1,757 sq ft
1,397 sq ft (ITZA)
What additional advice did you give in regard to LSV?
- Alternative use is retail
- Useful economic life in excess of 25 years
- Local market: the context of the disposal project will impact value in the short term, but demand should improve over the long term when assets return to established nature
- LAP: advised lease subject to 15 year extension
- Marketability
- Buyer profile
- Security of the loan
Were you made aware of the terms of the loan?
£794,500 over a 15 year term, rate reviewed after five years
What does does the acronym PW stand for?
Place of Worship
What does the acronym TCB stand for?
Telephone Call Box
What does the acronym LB stand for?
Letter Box
What bases of value did Bank of Scotland ask you to provide?
- MV1 - fully equipped operational entity
- MV2 - 180 day marketing period
- MV3 - closed, stripped and with licence lost
- MV4 - vacant possession (which we have assumed to be the same as MV3)
- Market Rent
Did you inspect the roof?
Visual inspection only for any obvious visible defects. This is not a building survey.
What changes did you make to the wages assessment?
- Didn’t get full granularity of current wages assessment
- Locum costs high as no resident pharmacist in site
- Placed resident pharmacy at cheaper hourly rate
- 80 dispensing hours
- 40 hours cashier
- 20 hours driver
- 7 hours locum
