Part 1

Question 1

What are the 5 methods of valuation?

Answer 1

Comparable, Investment, Profits, DRC and Residual

Question 2

How do you decide which valuation method to apply?

Answer 2

I consider the type and use of the Property, the availibilty of evidence and purpose of valuation.

Question 3

What is a years purshase multiplier?

Answer 3

the multiple of rent an investor would pay for a property

Question 4

Example of good covenant and how this might impact the valuation?

Answer 4

tenant with storng financial record - long lease, secured income - lower yield -

Question 5

What is a PI insurance?

Answer 5

PI protects you against claims for loss or damage made by clients or third parties as a result of the impact of negligent services you provided

Question 6

Why do survyors need PI?

Answer 6

gives you protection in the event that you are accused of providing incorrect or faulty advice which causes financial loss to your client.

Question 7

What level of PII cover dose your firm have?

Answer 7

1 Million USD on any claim

Question 8

How would distinguish limitations on liability in your valuations?

Answer 8

By including a liabilty cap in ToE and report

Question 9

What should be included in ToE and Report? and where is it covered in teh redbook?

Answer 9

ToE - 18 requirments VPS 1 , Report - 16 requirments VPS 3

Question 10

Fair Value?

Answer 10

the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date - IFRS 13

Question 11

MV vs FV?

Answer 11

0

Question 12

What is the valuer registarion scheme ?

Answer 12

The Valuer Registration scheme is a quality assurance mechanism that monitors all registered RICS members who carry out valuations within the scope of RICS Valuation Standards “Red Book” in order to ensure consistent standards.

Question 13

are there any instences where certain sections of teh redbook may not apply?

Answer 13

Read - PS1 and PS2 by George

Question 14

Addtional criteria for secured lending valuations?

Answer 14

VPGA 2

Question 15

Yield

Answer 15

the total income an investment generates over a set period, expressed as an annual percentage

Question 16

Net Yield

Answer 16

“Net yield” is the yield after paying for any costs relating to that income such as fees or commissions, Rates, repairs and running costs

Question 17

Reversionary yield

Answer 17

the anticipated yield, which the initial yield will rise to once the rent reaches the ERV and when the property is fully let

Question 18

Equated yield

Answer 18

the yield on a property investment which takes into. account growth in future incom

Question 19

Equivelent Yield

Answer 19

weighted average of the Net Initial Yield and Reversionary Yield and represents the return a property will produce based upon the timing of the income received.

Question 20

Key issues in RICS survaying safely GN?

Answer 20

best practice for surveyors, including corporate and personal responsibilities relating to health & safety. - risk assesment , risk control

Question 21

Grade A office

Answer 21

New or refurb, suspended ceiling, raised floors, high speed lifts, ample parking, within a CBD,

Question 22

Optimum depth to allow natural light

Answer 22

1.5 times the window head height

Question 23

Office hieght

Answer 23

2.6 meters

Question 24

Easement

Answer 24

An easement is an agreement between two parties, where one is granted land access in exchange for a fee

Question 25

‍Deleterious materials

Answer 25

‍Deleterious materials are materials or building techniques that are dangerous to health, environmentally unfriendly, tend to fail in practice or can be susceptible to change over the lifetime of the material.

Question 26

Hazardous

Answer 26

ny substance or material capable of posing an unreasonable risk to health, safety

Question 27

Rack rented

Answer 27

Passing rent equals or nearly equals the Market rent

Question 28

Hardcore approach

Answer 28

It considers the current market rent being received and applies this on a perpetual basis • The difference between the current rent being received and expected market rent at the time of the lease renewal is also considered on a perpetual basis.

Question 29

Law 2 2022

Answer 29

Sharjah Law No. 2/2022 amending Article 4 of Sharjah Law No. 5/2010, has restated the general position that the right of property ownership in Sharjah is limited to UAE and GCC nationals. However, it provides for a number of exceptions whereby the right of ownership can also occur, this includes areas and projects specifically determined by Sharjah Executive Council.

Question 30

NPV and IRR

Answer 30

Net present value and internal rate of return

Question 31

Term and reversion

Answer 31

The term and reversion method is used when the property has an
existing lease in place that is due to expire.
• The existing lease terms are considered separate from the expected
new lease terms within the valuation approach.

Question 32

Topslice

Answer 32

overrent part of the rent

Question 33

Marriage value

Answer 33

the addtional value that arises from combining to assets

Question 34

whats is good will

Answer 34

Goodwill is an intangible asset when property or real estate is being sold or purchased • Goodwill is a value within the transcation that is higher than the sum of the net fair value • For example the Goodwill portion of the transaction maybe included due to special features of the asset being exchanged which may be associated with brand name, local customer base, excellent reputation etc • The Goodwill element will create a special value over and above the value of the land or building being exchanged.

Question 35

EBITDA

Answer 35

earnings before interest, taxes, depreciation and amortization