Definitions Flashcards
Define Yield
A measure of investment return, expressed as a percentage of capital invested
Define All Risk Yield
The remunerative rate of interest used in the valuation of fully let property let at market rent reflecting all the prospects and risks attached to the particular investment
Define True Yield
A True Yield assumes rent is paid in advance not in arrears (traditional valuation assumes rent is paid in arrears)
Define Nominal Yield
Initial yield assuming rent is paid in arrears
Define Gross Yield
The yield not adjusted for purchasers costs (such as an auction result)
Define Net Yield
The resulting yield adjusted for purchasers costs
Define Equivalent Yield
Average weighted yield when a reversionary property is valued using an initial and reversionary yield
Define Initial Yield
Simple income yield for current income and current price
Define Reversionary Yield
Market Rent (MR) divided by current price on an investment let at a rent below the MR
Define Running Yield
The yield at one moment in time
Define Internal Rate of Return (IRR)
The rate of return at which all future cashflows must be discounted to produce a NPV of zero
Define Net Present Value (NPV)
The sum of the discounted cashflows
Define BREEAM (The Building Research Establishment Environmental Assessment Method)
A voluntary environmental assessment tool to rate new, refurbished and operational (“in use”) buildings
Define Market Value
The estimated price at which a property or asset would be exchanged between a willing buyer and seller assuming both parties are acting prudently, knowledgeably, and without compulsion.
Define Market Rent
The estimated amount at which a willing landlord and tenant would agree on for a property lease, assuming both parties are acting prudently, knowledgeably, and without compulsion.
Define Fair Value
The price that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants.
What is mediation?
Mediation involves the use of a neutral mediator who facilitates discussions between the two parties to explore whether a solution can be found
What is arbitration?
An alternative dispute resolution method where an arbitrator decides a dispute acting in accordance with statute (The Arbitration Act 1996)
What is an Alternative Dispute Resolution method? (ADR)
These are dispute resolution processes and techniques that fall outside the scope of court litigation.
What is Unconscious Bias?
The term relates to the associations we hold which are deeply ingrained and outside of our conscious awareness or control
What is an inclusive environment?
An inclusive environment is one which is designed and managed to allow people with a diverse range of needs and abilities to access and use it
What is a Hazardous material?
A material that is harmful to health
Define Investment Value
The value of an asset to a particular owner, or prospective owner for individual investment or operational objectives
Define Hope Value
The Value arising from any expectation that future circumstances affecting the property may change
Define Zoning
A valuation technique, not a method, that is used for the comparison of retail properties to create a unit of comparison for different sized buildings. (Dont forget ITZA)
Define Tenancy at will
A form of license created by written agreement for an unspecified time in which the landlord may evict the tenant at any time. Not a legal interest in land with no renewal right
Define Wayleave
A temporary right and pays and annual payment. it is typically personal to the company and cannot be automatically transferred to a new owner
Define Easement
This is a permanent right and receives a one-off payment. It allows a right enjoyed by one party over the land of another.
What does “Without Prejudice and subject to contract” mean?
It means that during the period of negotiations, the opposing party cannot subsequently rely upon any document or discussions held which are labelled ‘Without Prejudice’.
Define Competent Landlord
A freeholder or superior tenant with unexpired term of over 14 months
