Case Study - Valuation

Question 1

What are the different purposes for valuations?

Answer 1

1. Finance reporting
2. Secured Lending
3. Internal purposes
4. Compulsory purchase
5. For capital gains tax, inheritance tax

Question 2

Do you think the value would have changed if you were to be asked to value the property today? Not looking at specific value just thoughts on market changes.

Answer 2

I am aware that the Bromley submarket has been relatively static since I carried out this valuation. However, considering the global socio-economic events that have occured since I carried out the valuation, plus the shorter WAULT of the property, and that the vacant suite remains vacant, I would possibly consider adopting a softer yield to reflect the greater risks involved.

Question 3

What is the purpose of a Conflict of Interest and how is it undertaken?

Answer 3

To assess whether you are able to act in your client’s best interest and to be able to act with integrity.

It is completed by entering information into Salesforce. This information includes the client’s name, any 3rd party connections, and the postcode.

Question 4

How would you assess a conflict and what would you do if a conflict arose?

Answer 4

I would review the facts to see whether or not it is manageable, and inform the parties that there is a conflict. I could mitigate the conflict by information barriers.

If a conflict arose, I would assess whether I, as a surveyor, felt it would be appropriate to act. If there was a minor conflict, then inform both parties and draw up a Letter of Informed Consent. However, if I felt the conflict is strong then reject the instruction.

Question 5

What is a Letter of Informed Consent?

Answer 5

Informed consent occurs when a party who might be adversely affected by a CoI acknowledges the existence of that risk but still agrees to instruct an RICS regulated firm or RICS member to proceed with the assignment.

Question 6

What is included in the Service Agreement?

Answer 6

This includes most of that contained in the ToE, however does not mention the addresses, fee etc.

It includes PII cover, special assumptions, basis of value

Question 7

What is included in the Instruction Letter?

Answer 7

Details of the Property, Borrower, means of access for the inspection, Purpose of valuation, detail of loan, Client contact, client instructions, timing, details of additional reports, floor area instructions, property information, environmental / contamination details, agreed fee, anti-bribery details, and general terms.

Less detailed than a ToE as it is viewed in conjunction with the Service Agreement.

Question 8

What would be included within a Terms of Engagement?

Answer 8

⦁ Property address
⦁ Name and status of valuer
⦁ Name of client
⦁ Purpose of valuation
⦁ Basis of valuation (MR, MV)
⦁ Valuation Date
⦁ Agreed fee/timescale
⦁ Details of loan
⦁ Special Assumptions
⦁ Format of report
⦁ CHP
⦁ PII cover
⦁ Limitations of liability
⦁ Ensure the TOE are signed

Question 9

What is the purpose of a Red Book valuation?

Answer 9

To promote and support high standards in valuation delivery worldwide.

Question 10

What is Market Rent?

Answer 10

The estimated amount for which an interest in real property should be leased on the valuation date between a willing lessor and lessee on appropriate lease terms in an arm’s length transaction, after proper marketing, where both parties had acted knowledgably, prudently and without compulsion.

Question 11

What is Market Value?

Answer 11

The estimated amount for which an asset or liability should exchange at the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing where both parties have acted knowledgably, prudently and without compulsion.

Question 12

What Special Assumptions are you aware of?

Answer 12

Vacant Possession
Restricted Marketing Period
Anticipation of Physical Change
Anticipation of a new letting
Existence of a special purchaser
Lease lengths are as they will be at Loan Expiry

Question 13

Did you consider the value of the car parking spaces? If so, how did you account for this in your valuation?

Answer 13

I considered the number of car parking spaces to be consistent with the market and a building of its size, so did not make any additional assumptions in this regard.
If the parking provision was greater, I may have looked at this element of the property in isolation when arriving at my opinion of Market Value.

Question 14

What does the guidance note ‘Surveying Safely’ cover?

Answer 14

It sets out basic, good practice principals for the management of health and safety for RICS regulated firms and members.

Question 15

What is the RICS Code of Measuring Practice?

Answer 15

It is the best practice document for all measurement exercises except for offices and residential properties. It provides definitions to ensure a common & consistent approach to measurement.

The RICS Professional Statement: RICS Property Measurement (2nd Ed.) Jan 2018 (incorporating the International Property Measurement Standards) replaces the Code of Measuring Practice for offices and residential properties, and encompasses International Property Measurement Standards (IPMS) and practices aiming to avoid current inconsistent definitions of measurement in different countries.

Question 16

What is included and excluded in NIA?

Answer 16

To calculate NIA, I would include kitchens, notional lift lobbies, and built in cupboards, but exclude toilets, stairwells, and areas less than 1.5m in height.

Question 17

Did you measure using IPMS?

Answer 17

I did not measure using IPMS, as the instruction letter expressly stated not to report using the International Property Measurement Standards.

However, I did advise my client of the benefits of IPMS prior to commencing with the instruction (IPMS aims to avoid current inconsistencies in measurement definitions, bringing greater global transparency and consistency).

Question 18

What is a WAULT and how is it calculated?

Answer 18

It is the Weighted Average Unexpired Lease Term remaining to the first break or expiry of a lease across asset weighted by the contracted rent.

It is often undertaken when valuing an asset or considering appropriate investment yield comparables for multi-occupied individual investments or portfolios.

Calculated by multiplying the current rent by the remaining lease term for each tenant, and adding up the total sum of every tenant. Divide the sum by the current annual rent.

Question 19

What is the difference between FRI, IRI, and Effective FRI?

Answer 19

FRI - Full Repairing and Insuring basis. Under FRI, the landlord has no repairing or insuring liability.

IRI - Internal Repairing and Insuring basis. Typically, a lease of part of a building where the cost of internal repairs only falls on the tenant. As a result, market rent are often higher for this type of lease.

Effective FRI - This means the tenant is not directly responsible for all repairs etc, but the landlord is able to recover the cost of the repairs etc to the common structure from the tenant.

Question 20

If the lease had been subject to IRI terms, how would this have impacted your valuation?

Answer 20

The Landlord would have been liable for the structure of the building. Therefore an investor would consider the cost to repair any structural damage. However, I assumed there was no structural damage and it wouldn’t have needed a consideration of repair costs in this instance. Unless the client had come back otherwise on the building survey results.

Question 21

How did you undertake statutory enquiries?

Answer 21

Local Authorities website to ascertain planning information, conservation areas, and adopted highways.

Historic England for Listing information.

Environment Agency’s website for flooding risk.

VOA for rateable value.

EPC Register for EPC.

Question 22

If your property was listed, how might that affect the valuation?

Answer 22

If the property was listed, the internal specification may not have been as modern or well-specified as existing. This would alter my comparable evidence search and I may have adopted a lower market rent.

Additionally, listed buildings may be less attractive to investors as they create additional challenges for value add opportunities. For example, it may be unlikely to obtain planning consent to extend the property, or carry out refurbishment work to improve the specification (double glazed windows etc). This may negatively skew my opinion of Market Value.

Question 23

What is an Envirorisk Wizard Report and what does it mean?

Answer 23

It is a high-level environmental screening product designed to support lenders and chartered surveyors in identifying key investment risks relating to contaminated land liabilities, flood and coal mining subsidence.

Question 24

How did you establish the flood zone?

Answer 24

I searched the property on the Environment Agency’s website.

Question 25

What is Grade-A specification?

Answer 25

Grade-A specification refers to the highest quality of office buildings, which would include being situated in a prime location, having modern amenities, advanced technology and quality finishes.

Question 26

Did you consider what basis the rent reviews were drawn on? For example, were reviews based on the usual assumptions and disregards? Were they done on a net effective basis?

Answer 26

From the tenancy schedule and information provided by the borrower, I was aware that the rent reviews were drawn on the usual standard assumptions and disregards:

Assumptions:-
1. Available to let on the open market.
2. Property is fit and available for immediate occupation
3. All covenants observed by landlord and tenant.
4. Property may be used for the purpose set out in the lease.

Disregards:-
1. Any effect of goodwill on tenants occupation.
2. Ignore goodwill attached to the property.
3. Tenants improvements if landlord consent has been granted.

However, if the rent reviews were indexed (e.g., RPI or CPI), turnover rents, stepped increases, or upwards only, I would have considered this to not be reflective of the open market, and would have disregarded them from my comparable evidence.

Question 27

What are the five valuation methods?

Answer 27

There are five main methods of valuation, which include:
1. Comparative method
2. Investment method
3. Profits method
4. Residual method
5. Contractors method (Depreciated replacement cost)

Question 28

What is the equivalent yield?

Answer 28

It is the average weighted yield when a reversionary property is valued using an initial and reversionary yield.

Question 29

What is in a CreditSafe Report - what did you look out for?

Answer 29

A CreditSafe Report reviews a company’s financial performance over a three year period, and allocates the business a risk rating based of their covenant strength (A being safe, and B being less safe etc). It includes information such as the company’s turnover, pre-tax profit, and net worth.

To determine my opinion of the tenant’s covenant strength, I reviewed these reports alongside researching the business.

Question 30

If the property was situated in Bromley Town Centre Conservation Area, how would this impact the price achieved?

Answer 30

Conservation areas play a crucial role in preserving the unique character and historical significance of certain places. With that, they impose additional restrictions which impact buildings, such as Special Controls (Article 4 Directions) which restrict certain work you can typically do without planning permission e.g., replacing doors or windows, altering gutters and downpipes.

Therefore, being situated in a Conservation Area may negatively impact its price achieved as investors may have reduced asset management opportunities, or it creates additional barriers which reduces the marketability of the building.

Question 31

Do you know about monies held in an ESCROW?

Answer 31

An ESCROW is a legal arrangement in which a third party temporarily holds money or property until a particular condition has been met, such as the fulfilment of a purchase agreement. It’s commonly used in real estate transactions to protect both buyers and sellers during the buying process.

When buying or selling commercial property, the ESCROW agent holds the purchase price and other relevant funds until all contractual obligations are met.

Question 32

In respect of your comparable, Sovereign House, what would the effect be on the achieved yield if the vendor did not ‘top-up’ the income?

Answer 32

By topping up the income, the vendor is replicating the rental income the investment would achieve if it were fully let. This artificially improves the initial yield to increase the returns relative to the purchase price.

If the vendor did not top up the income, the initial yield would be lower to reflect that the rental income was smaller, and the return on investment was lower.

The vendor tops-up the investment to attract buyers, as it increases the rental income and makes it more appealing as there is a higher immediate cash flow.

Question 33

Other than allowing for vacant rates over the period of the assumed marketing void, how else could you have reflected this?

Answer 33

If I did not know what the rateable value was, I could have encompassed it within my adopted yield to reflect the added costs.

Question 34

What is included in vacant rates?

Answer 34

Vacant rates would encompass the business rates the property owner would have to pay (excluding the empty rates relief).

Question 35

When calculating the Market Value on the Special Assumption of Vacant Possession, did you allow for vacant rates?

Answer 35

Yes - I made an allowance for vacant rates in accordance with current legislation. This means I determined the rateable value and subsequently the rates liability by checking the current legislation - multiplier of 0.499 for properties with a RV of below £51,000, and 0.512 for above £51k.

Question 36

What valuations are not covered by the Red Book?

Answer 36

Red Book valuations are not required for:

1. Advice expressly provided in preparation for, or during course of negotiations or litigation.
2. The valuer is performing a statutory function (except for inclusion in a statutory return to a tax authority).
3. Valuation provided for internal purposes, without liability, and not communicated to a third party.
4. Valuation provided as part of agency and brokerage work in anticipation of receiving instructions to dispose / acquire an asset (except when a purchase report is required)
5. Valuation advice is provided in anticipation of giving evidence as an expert witness.

Question 37

When arriving at your opinion of Market Rent, why did you think a discount of £1 was appropriate?

Answer 37

I considered that a £1 discount was an appropriate representation of the market, as the quoting rent had attracted limited interest in over 3 years. I was of the opinion that a discount of 50p would not be sufficient, particular when paying regard to the more recent comparable evidence, such as 143 High Street which let at £20 psf.

Question 38

If the property was let to a strong tenant covenant for a long term certain and was over rented, I could have adopted the hardcore and layer technique. How would you have valued this? Explain both methods.

Answer 38

Hardcore & Layer:-
If the property was let to a strong tenant covenant for a long term certain and was over rented, I would have used the H&L technique. The income would be divided horizontally, where the bottom slice represents the Market Rent, which attracts a keener yield as it is less risky, and the top slice equals the passing rent less the market rent until the next lease event. A higher yield would be applied to the top slice to reflect the greater risk of being over-rented.

Equivalent Approach:
My opinion of Market Rent meant that two units were reversionary, two were over-rented, and one unit was vacant. Additionally, the property had a short term certain with a WAULT to break of 1.15 years, and comprised of weak tenant covenants.
With the aggregate rental income being reversionary, I considered the approach most investors would take in formulating a bid for the property. Reducing the valuation variables by determining an overall yield of the investment, the weighted average yield combines both the term and the reversion.

Using Argus for the reversionary suites, the current passing rent is built into the calculation as a hardcore layer. At the next lease event, the top slice represents the passing rent less the Market Rent which is capitalised into perpetuity. The void costs are subtracted from the calculation (including vacant rates, marketing, rent free etc).

Question 39

How did you age the property?

Answer 39

I obtained historical marketing particulars which included an indicative date, and I underpinned this evidence by researching the planning portal to ascertain the planning history.

Question 40

What specification was Leonard House?

Answer 40

I was of the opinion the property was of reasonable specification, but did not obtain Grade A specifications due its age and limited refurbishment - It did not have shower facilities, bicycle storage, did not have high ceilings throughout, and was dated in parts.

Question 41

What is the office market like in Bromley?

Answer 41

The office market in Bromley is mid-sized of approximately 3.7m sqft. It is characterised by a mix of purpose built offices from the 1980/90’s and converted residential dwellings of reasonable specification, with a several recently refurbished officed of Grade A specification.

Question 42

Why did you have regard to the rent reviews when they are quite dated? How did this compare to the transactions you had collected?

Answer 42

I had regard to the rent reviews as they provided an indication of rental rates within the subject property, which is the most relevant evidence - it does not require interpretation in terms of location, condition, specification etc.

Although they were relatively historic, one of the rent reviews was within 24 months of the valuation date, which I considered to be reasonable, particularly with a limited number of comparable lettings in the vicinity within the last 24 months.

However, I did recognise that I could not rely on this evidence alone, so cross-referenced the evidence alongside transactions within the vicinity to arrive at my opinion of market rent.

Question 43

How did you go about shortlisting your comparable evidence to arrive at your opinion of Market Rent?

Answer 43

I had regard to the Hierarchy of Evidence, being the relative weight attached to different types of evidence.

I paid most regard to Category A / direct comparables, being completed transactions of near-identical properties for which full and accurate information is available, which included data from the subject property. I also had regard to similar real estate being marketed where offers may have been made, plus asking prices (subject to critical analysis).

Finally, I considered Category B evidence, being general market data to provide guidance on information from public sources / commercial databases, and historical evidence.

Question 44

Your rental comparable evidence range is from £18.50 psf to £28.50 psf - why was the range so big?

Answer 44

The top end of the range reflects Grade A accommodation which is currently available. It is included in the schedule as it is situated close to the subject property, but I recognise it is a quoting rent and not a completed transaction.

The bottom of the range reflects basic accommodation which forms part of a mixed use development, and is marginally larger than the other units. As such I considered quantum to have slightly skewed this data.

Question 45

Tell me about your best rental comparable.

Answer 45

Aside from the evidence within the subject property, I had regard to the letting of Alliance House in February 2023, at a rate of £25 psf. The property is similarly situated to the north of Bromley town centre, and within a purpose built office building. However, I considered the aspect to be superior, it to comprise of a slightly higher specification, and with a marginally smaller floor area, I considered quantum. As such, I adopted a discounted rental rate psf.

I also considered the available unit at 143 High Street. Of a comparable size to the suites within Leonard House, it is also of reasonable specification. However, I acknowledged that it was a quoting rent, and that the unit was poorly configured at the rear of the building. Therefore, I adopted a higher rental rate psf.

Question 46

Was the property reversionary? What was the income profile without the vacant suite?

Answer 46

Disregarding the vacant suite, I was of the opinion the property was reversionary by £11,800 pa / 5.81%.

Question 47

Why did you adopt the investment method of valuation?

Answer 47

I adopted the investment method of valuation because there was an income stream. Additionally, I considered the property would likely be sold to an investor seeking to generate a rental income and improve the term certain, as opposed to an owner occupier.

Question 48

Why do we use an equivalent yield? Are there any other methods you could have considered?

Answer 48

The equivalent yield approach can be used for reversionary properties, by capitalising an equivalent yield (the weighted average of the initial and the reversionary yields) across the entire income stream. As the subject property was part reversionary, part over rented, and part vacant, plus had a short term certain of 1.15 years to the break option, the equivalent yield may reduce the valuation variables by determining an overall yield of the investment, factoring in the holistic risks involved.

I recognise that I could have adopted different valuation techniques for each tenant’s income stream - i.e., the term and reversion technique for the reversionary suites, and the hardcore and layer technique for the overrented suites. This would require critically analysing market evidence to arrive at different yields. However, I considered that the constrained market evidence made this difficult to justify, and that most prospective purchasers would consider the property’s holistic yield profile, which allows for informed investment decisions.

Question 49

How did the tenant’s covenant strength impact the advice you gave to your client?

Answer 49

I reported a SWOT analysis to my client, setting out the strengths, weaknesses, opportunities, and threats of the property. This included a weakness that the 100% of the current income is secured against tenants of uncertain covenant strength.

Question 50

You mentioned that as Community House was in a conservation area and a locally listed building, it restricted asset management opportunities, including redevelopment potential.

Was there re-development potential at your property? Did you run a residual on this?

Can you also provide an overview of Article 4 Directions, Permitted Development Rights, and Conservation Areas and the impact on planning / conversion potential.

Answer 50

I had regard to the potential to convert the property, and I did this by considering the conversion potential of my comparable evidence when arriving at my opinion of market value.

If there is no conversion potential (i.e., Article 4 Directions mitigates PDR), this may limit its marketability and be reflected in the market value / capital value psf. Locally Listed Buildings don’t require additional planning controls, but the council encourages their retention - all proposals for alterations have to be sympathetic.

Article 4 Directions - Issued by LPAs in circumstances where specific control over development is required, primarily where the character of an area of acknowledged importance would be threatened. Commonly applied for conservation areas and to not allow PDR. Leonard House does not have Article 4 Directions.

Permitted Development Rights - Allows the conversion from offices to residential. Prior approval is required, provided certain regulations are met. Recent legislation has removed certain barriers, such as requiring the building to be vacant for 3 months, and a limit of 1,500sqm.

Conservation Areas - Places specific planning restrictions aimed at preserving their unique character and heritage. Restrictions are imposed on demolition, trees, Article 4 Directions, and planning decisions (applications must preserve / enhance the area’s special character).

Question 51

Why did you have regard for the capital value rate per sq ft when you were using the investment method of valuation?

Answer 51

Whilst I principally had regard to the investment method of valuation, to cross reference and validate my opinion of Market Value, I underpinned the equivalent yield on a capital value rate per sq ft basis.
Additionally, I recognised that the short term certain meant that if the tenants exercised their break options, the property could become vacant imminently, in which case the capital value rate would be more appropriate.

Question 52

You mentioned a vacant suite in Sovereign House was topped up at the point of the sale.
Why did you not top-up your cash flow for the vacant unit?

Answer 52

For the purpose of the loan security valuation, I did not consider it appropriate to assume the vendor would grant a guarantee. As such, I did not top-up the income / build in a rental guarantee.

However, if a pre-let had ben agreed, I may have considered topping up the income to reflect this.

Question 53

Your yield profile represented an initial yield of 7.39%, and an equivalent yield of 9.25%, and a reversionary yield of 10.51%.

Why is your initial yield so keen in comparison to your comparable evidence?

Answer 53

The initial yield appears low due to the vacant suite which is non-income producing. The rental income is lower than it would be if the property were fully let, meaning the initial return on investment is lower relative to the purchase price.

If the property were fully let, the rental income would be greater, meaning the initial yield would be higher as there is an increase in returns relative to the purchase price.

Question 54

Why is a small lot size appealing to a range of investors?

Answer 54

The small lot size enhances the marketability as it will be affordable to a wider range of investors, including private individuals, property companies, and family trusts.

If investors have more equity, they are less likely to require debt raising. This is particularly relevant when borrowing costs are high.

Question 55

What advice did you give your client in relation to Market Value? Why, and how did this impact your client?

Answer 55

I analysed the most important characteristics of the property, the methodology adopted in arriving at my valuation, and the rationale behind my assumptions, and provided a SWOT analysis to my client.

Strength - The property is freehold and 5.81% reversionary excluding the vacant accommodation.

Weakness - 25.6% of the total floor area is vacant and non income producing, 100% of the current income is secured against tenants of uncertain covenant strength, and the property has a short WAULT of 1.15 years to break.

Opportunity - Let the vacant suite to a reasonable covenant at Market Rent, and re-gear the leases to extend the term certain.

Threats - Macro-economic and political uncertainty, considering the Ukraine war, Israel / Hamas war, etc.

On balance, I advised my client that I was of the opinion the property could be sold within a period of 12 months, and that it provided reasonable loan security.

Question 56

Why do we value on the special assumption of vacant possession?

Answer 56

Vacant Possession valuations allow the valuer to assess a property’s true market value without any encumbrances, which aids lenders in understanding the property’s value in a scenario where it is unoccupied, such as if the tenants exercise their break options and the property is no longer income producing.

VP value provides lenders with a clearer picture of the property’s true worth, aiding informed lending decisions.

Question 57

You mentioned that you adopted the hypothetical investment method of valuation to determine market value on the special assumption of vacant possession.

Can you tell me what you mean by this and why?

Answer 57

As I considered there to be insufficient similar sized and specified vacant offices in Bromley, and because demand would primarily stem from investors seeking to re-let the property, as opposed to owner occupiers, I adopted the hypothetical investment method.

Assuming the property is vacant and available to let, I allowed for a void period of 18 months in which to generate an income flow at Market Rent. I capitalised the assumed income at a rate of 10% to consider the uncertain future income and covenant strength and made allowances for vacant rates in accordance with current legislation during the assumed void period.

Question 58

You adopted a yield of 10% for vacant possession valuation, which is is 75 basis points more than your adopted yield to calculate the market value.

Why did you shift out the yield by 75 bps - it seems like a strange adjustment?

Answer 58

I softened the adopted yield to reflect the greater risks involved, as it encompasses the uncertainty of achieving my opinion of market rent in the assumed time frame.

To cross reference and validate my adopted yield, I considered vacant possession comparable evidence, which supported my vacant possession valuation.

Question 59

In respect of the vacant possession valuation, what allowance for vacant rates did you make? Did this include any vacant rates relief?

Answer 59

I made an allowance for vacant rates in accordance with current legislation during the assumed void period. This is equivalent to the rates liability associated with each unit.

I did not assume any allowance for empty rates relief as I was not assuming the units had just become vacant. Deducting 3 months of rates liability artificially improves the Market Value.

Question 60

Your vacant possessional value is within 10% of your market value which appears quite close. Why is this?

Answer 60

The VP value is relatively close to the Market Value as the property has a short term certain of 1.15 years to the break options, and the income is secured against tenants of uncertain covenant strength. Therefore, the property may be viewed by investors as similar to a vacant, and so the difference in value is relatively small.

Question 61

How did you comply with VPGA 2 of the Red Book? Give me an example.

Answer 61

VPGA 2 relates to Valuation of Interests for Secured Lending purposes.

I complied with VPGA 2 as I reported the valuation methodology and supported it with the calculations used, I commented on the property’s suitability for loan security, I made a comment on the environmental conditions, I provided a SWOT analysis which included circumstances which I considered could affect the price / marketability. I also commented on the potential occupational demand for the property.

Question 62

Give me two examples as to how you complied with the RICS Rules of Conduct in this instruction.

Answer 62

1. Complying with Rule One, I acted honestly and with integrity to provide a professional report which aligns with both personal and RICS obligations.
2. Prior to the instruction, I ensured that I was competent and had the necessary skills and experience to undertake the valuation, which complies with Rule Two - maintaining professional competency and ensuring that the work is undertaken by a competent individual.
3. Complying with Rule Three, I carried out the valuation on time and provided a good quality and diligent service, whereby fulfilling my clients Instruction Letter terms.

Question 63

On inspection, you said that you noted the method of construction.

Can you tell me about the method of construction and any defects that you looked out for?

Answer 63

In the capacity of a surveyor carrying out a valuation inspection, I noted the following construction method, however would seek to verify this with a building surveyor.

Built around 1990, the building is of a traditional masonry cavity wall construction, with a pitched roof covered with slate tiles. There is suspended timber flooring, cast iron rainwater goods, and double glazed windows. Additionally, I consider the property likely has pad foundations which supports and distributes the load.

Defects:
- Corrosion of the decorative finishes to the rainwater goods.
- Brickwork spalling.
- Brickwork efflorescence.
- Slipped slate tiles.
- Nail sickness (when a nail corrodes, it expands and breaks the slates).
- Damp (condensation, wet rot, dry rot).

Question 64

You mentioned that the property was previously valued.

When was this previous valuation and what is the difference in valuation?

Answer 64

• The previous valuation was carried out in December 2020.
• Market Rent of £20 psf
• Market Value of £2,435,000 reflecting £181 psf.