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SOE Questions Flashcards

1
Q

What are the 5 VPS

A

1) TOE
2) Inspection, Investigation and Records
3) Valuation Reports
4) Basis of Value
5) Investment Valuation approaches

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2
Q

What are the 3 types on financial statements you may come across relating to a company

A

Balance Sheets
Income Statements
Cash Flow Statements

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3
Q

What is the difference between financial and management accounts

A

Financial accounts - For collecting of accounting data to create financial statements required by law

Management accounts - Internal process used to account for business transactions

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4
Q

What is depreciation / amortisation on an income statement

A

How much value a companies asset has over time

Depreciation = falling value of fixed assets
Amortisation = falling value of intangible assets

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5
Q

How to work out if company is solvent

A

Current assets / current liabilities = liquidity ratio

Ratio less than 1 = insolvent

OR

Acid test current assets - inventory / current liabilities

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6
Q

What is IRFS16

A

Financial reporting standard, effective 1st Jan 2019

States leaseholders are required to recognise leases as assets/liabilities on financial statements

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7
Q

What is EBITDA

A

Earnings before Interest, Tax, Depreciation and Amortisation

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8
Q

What is GAAP and name 3 principles

A

Generally Accepted Accounting Principles = Common set of accepted accounting principles which companies must follow when compiling financial statements

Three Principles

1- Regularity
2 - Consistency
3- Sincerity

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9
Q

What documents would you need to consider for property measurement

A

International Property Measurement Standards 2023

Code of Measuring Practice (2015)

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10
Q

What is the difference between NIA & IPMS3

A

IPMS -

Includes columns and measures to the internal dominant face

Areas less than 1.5m in height are included, but stated separately

NIA

Internal columns & walls excludes

Areas less than 1.5m excluded

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11
Q

What is the difference between GIA and IPMS 2

A

IPMS

Includes covered galleries (stated separately)

Includes area occupied by reveals of windows when measured and assessed as the internal dominant face

GIA

Excludes above

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12
Q

What is the difference between IPMS1 & GEA

A

IPMS 1

Balconies and covered galleries includes by stated separately

GEA

Covered galleries included but not stated separately

Balconies Excludes

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13
Q

How did you measure Unit 29 Branbridges

A

GIA basis

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14
Q

What would you include/exclude on a industrial measurement

A

Include

  • Areas with less than 1.5m of headroom
  • Areas occupied by internal walls and partitions
  • Columns, stairwells, lift wells, lift rooms, plant rooms
  • Mezzanine areas with permanent access

Exclude

  • Canopies
  • Fire escapes
  • Perimeter wall thickness
  • Covered ways
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15
Q

What is the internal dominant face

A

Inside finished surface comprising more than 50% of the floor to ceiling height in each IDF section

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16
Q

What are the principles of the RICS Property Measurement Professional Statement (2018)

A

1) Provide measurement date
2) State measuring methodology
3) Provide reference and any scale of any plan used
4) State conversion factor and any rounding

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17
Q

What is plot ratio

A

Ratio between size of site and building footprint in GEA

C.40% for industrial

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18
Q

What was included in your NIA measurement for 3 Copthall

A

Includes

Skirting and perimeter trunking
Stationary Cupboards
Lift lobby

Exclude

Areas under 1.5 M
Protrusions more than 0.25m
Usuable space less than 0.25m
Internal structural areas
Corridors (If single function and not usable)

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19
Q

What are the 5 conventional methods of valuation

A

Comparable
Investment
Profit
Residual
DRC

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20
Q

What are red book exception

A

Clients internal purposes
Agency work
Statutory purposes

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21
Q

Valuation Unit 4 Branbridges - Explain process

A

Received request from client to valuation for internal purposes, agreed TOE and had signed

Investment Method as was let an income producing

Ascertained MR from agents and comparable evidence, found property was let at MR £25k p/a

Capitalised into perp using ARY to get value

Sense checked with competent individual

Presented findings to client

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22
Q

Plot 1 Residual - Method

A

Received instruction from client, agreed TOE and had signed, for internal purposes so was red book exempt.

Determined Market Value of Completed Development (MR capitalised at chosen yield)

- Less Development Costs

= Gross Development Value

 - Less developers profit

= Gross Residual Value

- x of of £1 in 12 months at interest rate

= Gross Acquisition Price

 Less agent and Legal fees (incl SDLT)

= Site value

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23
Q

Difference between residual land value and development appraisal

A

Development appraisal assesses viability of development, usually used by developer

Residual Valuation determine the underlying land value

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24
Q

What statutory due diligence would you take prior to a valuation

A

Asbestos
Tax (BR or Council)
EPC rating
Fire safety
Public Right of way

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25
Q

Describe the timeline to typical valuation instruction

A

Preamble

-Receive instruction
-Check competence and COI
-Issue TOE and have countersigned

Due Dillegence

  • Gather info, lease, title, maos
  • Undertake stat due dillegence
  • Inspect and measure
  • Comparable

Valuation & Report

  • Undertake valuation
  • Draft report
  • Have surveyor review work
  • Finalise and sign report
  • Issue to client

Completion

  • issue invoice
  • ensure filing for audit
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26
Q

Three valuation approaches according to IVS

A

Income

Cost

Market

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27
Q

What is the red book called

A

RICS Valuation Global Standards (2022)

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28
Q

Changes in red book compared to previous versions

A

To reflect significant changes to International Valuation Standards

Consistent global language

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29
Q

What are the 5 VPS’

A

VPS1 - TOE

VPS2 - Inspections, Investigations & Records

VPS3 - Valuation Reports

VPS4 - Basis of Value, Assumptions and Special Assumptions

VPS5 - investment Approaches and Methods

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30
Q

What must be confirmed in TOE (Vals)

A

ID and status of values

ID of client

ID of any other intended uses

ID of asset being values

Currency

Purpose of Valuation

Basis of Value

Valuation Date

Scope of work

Nature of sources relied upon

Format of report

Assumptions & special assumptions

Confirmation valuation will be undertaken in accordance with IVS

Fee

CHP

Statement compliance is subject to RICS monitoring

Limitations

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31
Q

Rent Review Unit 2 Branbridges Process

A

Received instruction from client

Analysed clause to understand mechanism, assumptions, disregards and dispute resolution, was an open market upwards-only.

Arranged inspection and measured on GIA basis

Confirmed no breach of lease or arrears

Gathered comps to determine MR

Once determined presented MR to client

Sent proposal to T with comps & rationale

once agreed sent sols RR memo to be signed

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32
Q

What are the contents of a RR Clause

A

Machinery
Who can initiate RR
Assumptions, diregards
Basis of RR (Upward only, RPI, Turnover, stepped increase)
If time is of the essence

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33
Q

Lease renewal 3 Copthall process

A

Received instruction from client (T 12 months from expiry)

Reviewed terms, T benefitted from security of tenure

Inspected and measured

Confirmed T wasn’t in breach and had no arrears

Gathered comp, found property to be under rented

Recommended client to uplift rent by serving S25 within 6 months of expiry to £75 psf

Once terms agreed instructed sols to formalise new lease

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34
Q

Break Notice 3 Copthall Avenue Process

A

Client received written break notice from tenant in Jan 2023 requesting to break lease on April 19th 23

Passed to me to determine validity

Reviewed lease and found T would have to give no less than 6 months notice, therefore notice was invalid, confirmed with solicitors.

Reverted to client advising notice wasn’t valid, notified tenant after

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35
Q

What are the statutory obligations of a commercial property owner

A

1) Asbestos management
2) Contaimination
3) Disability and Discrimination
4) EPCs
5) Fire safety
6) Health and Safety
7) Legionnaires Disease
8) Occupiers Liability
9) PAT Testing
10) Waste Management

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36
Q

What is your company’s lone working policy

A

Pre site visit H&S assessment
Fully charged phone
Let colleagues know of site visit
Give return time
Wear appropriate PPE

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37
Q

What PPE have you had to wear

A

When inspecting a factory I wore Hard Hat, Steel Toe Cap boots. & high vis

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38
Q

When have you undergone a RA

A

When attending a dilapidated retail unit (Harvey Centre) with an agent

Made sure to mandate PPE and avoid specific areas

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39
Q

What is Workman’s CHP

A

Complaint received and passed to PIC/company secretary

Complaint acknowledged within 7 days

Written response within 28 working days

If complainant not happy ADR followed, 3rd party redress

All complaints recorded in complaints log

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40
Q

Discuss good example of client care

A

KanAm monthly meetings

Organise meetings

Arrange internally for reports to be completed and collate

Chair the meeting and screenshare

Share updated minutes post meeting

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41
Q

Can you give an example of where you have demonstrated effective communication skills

A

When obtaining information off local agents for comparable evidence purposes. I was able to use my communication skills to obtain this information free of charge despite them having no obligation to disclose the information.

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42
Q

Unit 29 Branbridges, Arrears Process

A

T late in making payment of Sept 2023 Q

Contacted tenant three days after rent way due to try resolve issue without need for debt recovery, no response from tenant.

Contacted client to initiate CRAR proceedings, sent out 7 day letter.

Once T received letter they made contact and paid the outstanding sums on the same day

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43
Q

Licence to assign, Unit 7A Fountains Process

A

Received application from tenant

Read lease and confirmed that assignment of whole lease was permitted with prior LL consent

Contacted client who agreed in principle so long as lease terms were met.

Obtained 3 years audited accounts from proposed assignee

Obtained financial review and credit report of both parties.

Info found covenant strength of proposed assignee was extremely strong and would have no issue with meeting financial obligations of the lease. AGA not required

Ensured that the T’s solicitor provided an undertaking of the costs whether or not the matter proceeded to completion.

Undertook appropriate due diligence - AML checklist & sanctions check, confirmed no breach of lease or arrears on account

Provided client with recommendation that assignment was granted, once agreed by all parties I instructed sols to document by licence to assign.

Updated systems to show assignment of lease.

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44
Q

Licence to Sublet - Unit 13

A

Received application from T to sublet entire unit. 5 year lease, 3 years unexpired.

Reviewed alienation clause lease and confirmed that subletting of whole was permitted subject to LL approval.

Contacted to LL who agreed in principle so long as the alienation terms were complied with.

Carried out AML & sanctions check on proposed sub tenant, confirmed T wasn’t in breach or had any arrears. Obtained undertaking for costs.

Carried out financial review of both parties to ensure terms of the lease could be met. Found that sublessee was of strong covenant.

As per lease sub-lease couldn’t be less than MR, therefore I reviewed comps and spoke to agents to confirm MR, unit was let at MR.

Received sublease and rent was at MR, recommended to proceed with subletting subject to sols reviewing lease.

Once approved I instructed sols to review sublease, no issues found. Application was documented by way of licence to sublet.

Updated records

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45
Q

What additional legislation is there to the Red book

A

UK National Supplement 2023 - Effective 1st May 2024

Supports red book for vials in UK jurisdictions, does not replace

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46
Q

Four key points RICS Guidance Note - Surveyors Acting as Expert Witness (2023)

A

1) Expert evidence must be impartial and objective
2) Duty of care to court and will override any obligations to client
3) Evidence must in independent work of surveyor
4) Surveyor must believe in the facts on which they rely are complete and true

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47
Q

What is adverse possession

A

When a party who doesn’t own the land becomes owner of the land (10/12 years)

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48
Q

What changes are facing the RICS

A

1) Sustainability drive to net-zero
2) LL’s applying for EPC exceptions due to high costs
3) Keeping the retail sector competitive
4) Changes in office model since COVID

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49
Q

How would you respond if a contractor asked you out for dinner

A

If in process of a tender, straight rejection

I would consider the Bribery act, dinner is proportional

I would notify PIC and register the dinner on my company’s gift register

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50
Q

What are the 5 RICS Rules of Conduct

A

1) Members must be honest and act with integrity
2) Members must maintain their professional competence
3) Members must provide good quality and dillegent service
4) Members must treat others with respect and encourage diversity and inclusion
5) Members must act in the public interest

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51
Q

Purpose of changes to Rules of Conduct

A
  • Simpler Structure
  • Clear examples
  • Focus on Respect and D&I
  • Understanding importance of tech and associated risks and benefits
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52
Q

How do you pursue a guarantor for arrears

A

Under S17 L&T Covenants Act 1995

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53
Q

How long do sums have to be outstanding for a guarantor to become liable

A

6 months

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54
Q

What is the guarantor entitled to do if they pay the arrears in full

A

Guarantors may request overriding lease

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55
Q

What does CPSE stand for

A

Commercial Property Standard Enquiries

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56
Q

What type of information would you gather as part of CPSE’s for a sale

A

1) Property
2) Tenant
3) Arrears
4) Compliance
5) Insurance
6) Applications

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57
Q

What is the fine for not presenting a valid EPC

A

12.5% of RV (Capped at £5k)

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58
Q

Unit 29 Measurement, what standard did you use?

A

GIA

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59
Q

When did IPMS all buildings come into effect

A

Jan 2023

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60
Q

Where would GEA be used

A
  • Town planning
  • Rating & Council Tax
  • Building Cost estimation
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61
Q

Why is financial vetting of contractors important

A
  • To ensure liquidity of contractor is at a good level
  • To then protect L & T’s position in case of defaulting
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62
Q

What are the key pieces of RICS Guidance for Property Management

A

RICS Guidance Note, Commercial Property Management in England and Wales (2011)

RIC Professional Statement, Real Estate Management (2016)

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63
Q

How would you value an under rented property

A

T&R

Value income at current rent until rent review/lease end

Then adjust to MR, capitalise at chosen yield into perpetuity

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64
Q

How would you value an over rented property

A

Hardcore and Topslice Method

  • Income flow divided horizontally

Hardcore (MR) valued into perp and Net initial Yield

Top slice (current rent - market rent) capitalised to next lease event at net initial yield

Top slice yield is higher due to increased risk of over renting

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65
Q

What is included in Workman’s privacy notice?

A
  • What information you have
  • What information will be used for?
  • Which third parties you might share the information with?
  • How long the information is being kept for?
  • What legal right the firm has
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66
Q

What would you do if there was a data breach

A

Notify the Information Commissioners Office (ICO) within 72 hours

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67
Q

Why did you not measure Unit 29 using IPMS

A
  • Not mandatory
  • Limited comps in IPMS
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68
Q

What method did you use to measure 3 Copthall

A

IPMS 3

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69
Q

How does energy efficiency impact a buildings value

A

Improves as

  • More cost effective to run sustainable building
  • Investors and occupiers are more conscious about carbon footprint of building and will pay higher price for sustainable building
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70
Q

When are EPCs required on a property

A

When a commercial building over 50m2 is:

  • newly built
  • sold
  • leased for longer than 6 months
  • heating/cooling is altered
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71
Q

When would you not need an EPC

A
  • listed building
  • building with no heating
  • temporary buildings
  • buildings set to be demolished
  • buildings less than 50m2
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72
Q

Under what circumstances is a building exempt from MEES?

A
  • If property doesn’t need EPC
  • If increasing rating isn’t feasible assuming payback period of 7 years (3 quotes must be sought)
  • If changes would reduce the value of the property by +5%

Exemptions last 5 years, can’t be transferred at sale

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73
Q

What legislation relates to money laundering

A
  • Proceed of Crime Act (2002)
  • Bribery Act (2010)
  • Money Laundering, Terrorist Financing & Transfer of Funds Act (2017)
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74
Q

What are the penalties under the Money Laundering, Terrorist Financing & Transfer of Funds Act (2017)

A

Being complicit in money laundering = up to 14 years in prison + unlimited fine

Failing to report money laundering = up to 5 years in prison + unlimited fine

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75
Q

What is Workman’s policy on money laundering

A
  • Carry out conflict of interest checks
  • AML risk assesments
  • Gifts register
  • Vets - tenants, potential clients and contractors
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76
Q

What is Workman’s gift policy

A
  • Consider proportionality and circumstances
  • If acceptable, notify PIC and register on Workman’s E-register

For contractors
- if accepting gift is to be raffled

For client
- If accepted, may keep however to be shared with team working on client

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77
Q

How do you understand a client’s aims and objectives

A
  • Ask questions and listen carefully
  • Understand client brief
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78
Q

Give an example of a client aim and objective you have worked on

A

Branbridges EPC project, getting entire estate to minimum B

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79
Q

What forms of communication are there

A
  • Verbal
  • Non-verbal
  • Written
  • Presentation
  • Listening
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80
Q

What are the types of negotiation

A

Hard - Goal of victory
Soft - Goal of agreement
Principled - Goal of problem solving

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81
Q

What is my style of negotiation

A

Depends on situation primarily

Accommodating - maintaining relationship a priority

Collaborative - mutual success

In extreme examples (debt collection)

Dominant - outcome over relationship

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82
Q

What types of H&S training have you had

A
  • Legionella Awareness
  • Asbestos
  • General H&S
  • Contractor management
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83
Q

What are the penalties for breaching the H&S at work act 1974

A

£20k fine

Imprisonment

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84
Q

What legislation relates to asbestos

A

Control of Asbestos Regulations (2012)

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85
Q

What is IOSH

A

Institution of Occupational Safety and Health

Global organisation for H&S professionals

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86
Q

Give an example of something you learnt on IOSH

A
  • Contractor Management
  • How to write RA
  • How to identify risk
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87
Q

What is your understanding of GAAP

A

Generally Accepted Accounting Principles

  • Standards that encompass the details, complexities and legalities of business accounting
  • must be followed when compiling financial statements

Introduced to improve the clarity of communicating financial information

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88
Q

What are the 3 principles of GAAP

A

RCS

  1. Regularity
  2. Consistency
  3. Sincerity
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89
Q

Tell me about a common financial measure

A

Current Ratio = Current Assets / Current Liabilities

aka Working Capital Ratio

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90
Q

What are the 3 types of financial statement you might come across relating to a company

A
  1. Balance Sheets
  2. Income Statements
  3. Cash Flow Statements
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91
Q

What is the basis of value under IRFS 13

A

Fair Value

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92
Q

What is IRFS 16

A

Obligation for leaseholders to show leases in their financial reporting (balance sheet etc)

Came into effect 1st Jan 2019

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93
Q

What is the result of IRFS 16

A

Increase in assets, liabilities and debt when lease is bought onto balance sheet

Could result in entities taking shorter leases to reduce debt on balance sheet

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94
Q

What RICS Guidance do you relate to in relation to handling client money

A

RICS Professional Statement, Client Money Handling (2019)

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95
Q

What is a P&L account

A

Summary of business income and expenditure transactions on an annual basis, gives overall P or L figure

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96
Q

How is gross profit calculated

A

Turnover - cost of sales

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97
Q

What is Net Asset Value

A

Total assets - total liabilities

If share price is higher than NAV per share, the market expects the company to make future profit

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98
Q

What are the 3 parts of a balance sheet

A
  • Assets
  • Liabilities
  • Owners Equity
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99
Q

How would you work out if a company was solvent

A

Current assets / current liabilities (liquidity ratio)

(Current Assets - Stock) / Current liabilities (Acid test)
- More short term approach, measures ability for quick assets/cash to meet liabilities

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100
Q

Name a KPI you have worked with

A

Rent collection, 98% by Day 28

Failure to meet will reduce performance bonus and reduce likelihood of new instruction

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101
Q

What RICS Guidance is there on conflict on interest

A

RICS Professional Statement, Conflict of Interest (2017)

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102
Q

What are the three main processes to solve disputes

A
  1. Negotiation
  2. Mediation
  3. 3rd Party Dispute Resolution
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103
Q

What is ADR

A

= Alternative Dispute Resolution

Dispute resolution service which falls outside of the scope of the court

Quicker and less costly, decided by a surveyor instead of a judge

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104
Q

What is PACT

A

Professional Arbitration on Court Terms

  • Form of arbitration for lease renewals
  • Is an alternative to litigation
  • Is legally binding
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105
Q

What are the principles of GDPR

A
  • Information used lawfully, fairly and transparently
    collected for specified, explicit, and legitimate purposes
  • Adequate, relevant and limited to necessity
  • Accurate (kept up to date)
  • Kept no longer than necessary
  • Kept safe
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106
Q

What are the individual rights under GDPR

A

-To be informed
-To access
-To rectification
-To erasure
-To restrict processing
-To data portability
-To object
-To automated decision making and profiling

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107
Q

What is the penalty for breaching GDPR

A

Up to 20 million euros

Or 4% global turnover

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108
Q

What is Workman’s policy in case of a data breach

A

Suspect breaches reported to PIC and firms data protection officer

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109
Q

What are challenges facing the RICS

A
  • Sustainability drive to net zero
  • Keeping retail sector competitive with rise of E-commerce
  • Adapting office sector post COVID
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110
Q

What is the Land Registration Act (2002)

A

States all leases and freeholds over 7 years must be registered with compliant plan (10 years for adverse possession)

Gives goal of having all property registered electronically by 2030

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111
Q

What is required for compliant Land Registry Plan

A
  • Drawn on scale of 1:100 or 1:200
  • Have a scale measurement bar
  • Have scale noted on the plan
  • Include a 1:1250 scale map of the location (for urban areas)
  • Full address including postcode
  • North point arrow
  • Demise outlined in red
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112
Q

What is the legal framework for equality and diversity

A

Equality Act (2010)

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113
Q

What are the 9 protected characteristics under the Equalities Act (2010)

A
  • Age
  • Gender
  • Religion
  • Race
  • Disability
  • Sex
  • Sexual Orientation
  • Marriage/Civil Partnership
  • Pregnancy / Maternity
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114
Q

What has RICS created to promote equality

A

IEQM

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115
Q

What are the four principles of IEQM

A
  1. Leadership
  2. Recruitment
  3. Culture
  4. Development
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116
Q

Give examples of inclusive design

A
  • Ramps
  • Doors/lifts wide enough for wheelchairs
  • Low hand rails
  • Braille for those with visibility issues
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117
Q

What is the civil penalty for not displaying a valid EPC

A

12.5 of RV up to £5k

Could increase up to £30k from 2028

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118
Q

What is section 18(1) of the L&T Act 1927

A

States that damages are limited to the diminution in value to the Ls reversion caused by the Ts breach

Case law

Jones v Hexheimer (1950)
- Court awarded damages based on the cost of the L’s repairs required for him to re-let

Smily v Townsend (1950)
- L did not intend to carry out repairs, so damage is negligible

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119
Q

What is section 19(2) L&T Act 1927

A

Where Ls consent can be given, it cannot be unreasonably withheld

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120
Q

What is S23 of the L&T Act 1954

A

Tenancies to which the act applies

  • Business tenancies of over 6 months
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121
Q

What is S43 of the L&T Act 1954

A

Tenancies to which the act does not apply

  • Agricultural Holdings
  • Mining Leases
  • Residential Tenancies
  • Tenancies granted as condition of employment
  • Tenancies not exceeding 6 months unless
    - There is provision for extension
    -T has been in occupation for more than 12 months
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122
Q

What is S24A of the L&T Act 1954

A

Application to court for interim rent

  • Is the rent from the period of the expiry of the S25 or 26 (should a period exist) to the start of the new lease

Interim rent is the rent of the new tenancy unless L or T show otherwise, e.g.
- different valuation dates
- different terms of old and new tenancy

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123
Q

What is S25 of the L&T Act 1954

A

Landlord’s notice

  • Must be served between 12 or 6 months to:

a) Contractual end of the tenancy
b) Date specified in the notice i.e.
- if the tenancy has less than 6 months to run
- T is holding over under S24
- T is on periodic basis

Either a Friendly or Hostile notice is given

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124
Q

What is included in a friendly S25 notice

A
  • Property comprised
  • The rent
  • The other terms
  • A health warning explaining to the T that Ls proposals are for
    purpose of negotiation
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125
Q

What is included in a hostile S25 notice

A

The ground(s) under S30(1) upon which the L would oppose the Ts application for new T

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126
Q

What is S26 of the L&T Act 1954

A

Ts request for new tenancy

For T who’s term exceeds 12 months and has not yet received a S25 notice within the 12-6 month period (can also be requested after)

T may propose
- start date of new lease (up to 12 months from date of notice)
- Property comprised
- The rent
- Other terms

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127
Q

How may a L respond to a S26

A

May not serve S25

Can serve counter notice within 2 months to oppose the request for new tenancy and/or proposed terms

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128
Q

What happens if the L fails to respond to the S26 within the appropriate time window

A

L loses right of objection to new tenancy

Does NOT lose right of objection to new terms

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129
Q

What is S24(1) of the L&T Act 1954

A

If the tenancy has been terminated according to the act, the L&T may apply to court to determine the terms of the new tenancy

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130
Q

What is S27 of the L&T Act 1954

A

Where T wants to leave premises

Must be at least 3 months to expire and no later than the end of tenancy

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131
Q

What is your understanding of Single Horse Properties v Surrey County Council (2002)

A

L served S25

T served counter-notice and applied to court for new tenancy

T vacated premises and returned keys prior to expiry

Court held as tenant had ceased occupation before expiry the S25 was of no effect

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132
Q

What is S28 of the L&T Act 1954

A

Agreement for new tenancy

If L&T agree new tenancy for premises
- current tenancy shall continue until commencement of new tenancy and will cease to be a tenancy to which the act applies

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133
Q

What is S40 of the L&T Act 1954

A

Obtaining preliminary information from the other party

  • L&T can request information from other party within last two years
    of the term for renewing or terminating a tenancy

e.g. L may request details of occupation or sub-tenancies
T may request details of superior L

Either party must provide correct info within 1 month of request

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134
Q

What is S30 of the L&T Act 1954

A

Landlord’s grounds for possession if opposing request for tenancy in S25 notice or in response to Ts S26 notice S30(1)

a) T has failed to carry out repairs
b) T has persistently delay paying rent
c) T is in breach of some other covenant
d) L offers suitable alternative accommodation
e) Where tenancy was created by a sub tenancy and the building let as a while would produce a higher rent than from separate lettings
f) L intends to demolish to reconstruct premises
g) L intends to occupy the premises for own purposes
LL must have been L for 5 years

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135
Q

Under what ground of S30 would the tenant be entitled to compensationWhat i

A

e) Where tenancy was created by a sub tenancy and the building let as a while would produce a higher rent than from separate lettings
f) L intends to demolish to reconstruct premises
g) L intends to occupy the premises for own purposes
LL must have been L for 5 years

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135
Q

How is compensation calculated

A

Under S37

RV multiplier
- If tenant in occupation for 14+years 2 x RV
- Less than 14 years = 1 x RV

Court may also award compensation for damage or loss sustained by T due to Ls misrepresentation or concealment

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136
Q

What can the L do if the T doesn’t vacate when supposed to

A

L can double rent under L&T Act 1730

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137
Q

What is S29 of the L&T Act 1954

A

Power of the court to determine new tenancy

If the tenancy is terminated in accordance with Act and application from L or T has been made under S 24(1) the court has the power to grant a new tenancy under S29(1) and may determine:

  • The property comprises
  • Length of lease
  • Rent
  • Other terms
  • Interim rent
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138
Q

What is S32 of the L&T Act 1954

A

The property comprised

Usually same as in old tenancy

However if L has objected to tenancy as they want to substantially reconstruct court may order a tenancy of part of the property (S31A(1)B))
- so long as T agrees and L can carry out works

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139
Q

What is S33 of the L&T Act 1954

A

The power the court has in granting a term length

Max 15 years (was 14 years before 1st June 2004)

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140
Q

What is S34 of the L&T Act 1954

A

The rent the property might reasonably be expected to let in the open market by a willing lessor, disregarding
- Ts previous occupation
- Any goodwill
- Certain improvements (see below)
- Carried out by T during old tenancy
- Less than 21 years before the application for new tenancy was made
- License to sell intoxicating liquor

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141
Q

What is S35 of the L&T Act 1954

A

The other terms of a new tenancy

  • To be agreed between L & T
    • Or determined by court
  • Court must have regard to terms of old tenancy and other relevant
    circumstances
  • L may change terms if relevant circumstances are that different
    terms are being agreed in the open market

Satisfied by O’May case

142
Q

What is your understanding of the O’May and Others v City of London Real Property Co. Ltd [1982] case

A

Either party wishing to change terms of the lease will have to satisfy 4 tests (RICF)

(Reason, Impair, Compensation, Fair)?

1) Has the party demanding the change showed good reason?
2) Will the adjustments materially impair the conduct of Ts business
3) Will the party resisting the change be adequately compensated
4) Is the variation fair and reasonable between the parties

143
Q

What is S36 of the L&T Act 1954

A

Carrying out the order for a new tenancy

  • L bound to grant new lease on terms determined by court
  • T can apply to have the court order revoked within 14 days, tenancy
    will continue for reasonable period for L to re-let
144
Q

What is S38 of the L&T Act 1954

A

Contracting out

For new tenancy of fixed term L or T may contract out of S24-28

L must serve T a notice under Regulatory Reform (Business Tenancies) (England and Wales) Order 2003

if notice served + 14 days before valid agreement for lease of start date
- T must sign simple declaration

If notice serve less than 14 days
- T must sign a statutory declaration before a solicitor

145
Q

How would you know if time was of the essence

A
  • Lease says so
  • Lease makes it clear that time limits are strict
  • There are deeming provisions
  • T serves notice saying time if of the essence
146
Q

What is a deeming provision

A

Where lease expressely states

  • L to give notice proposing a new rent
  • T to serve counter-notice with a counter proposal within a stated
    period of time
  • If T fails to serve counter-notice in time, T is deemed to have agreed
    Ls rent
  • L could be deemed to accept Ts counter proposal if lease states so
147
Q

What case law relates to time being of the essence

A

Burnely & Cheapside cases

148
Q

What matters are to be disregarded in a rent review

A
  • Ts previous occupation
  • Any goodwill
  • Certain improvements (see below)
    • Carried out by T during old tenancy
    • Less than 21 years before the application for new tenancy was
      made
    • License to sell intoxicating liquor
149
Q

What assumptions are usually made in a rent review

A
  • Subject premises is fit for immediate occupation and use
  • Market rent will be payable after expiry of any RF period
  • No work has been carried out by T which reduced rental value
  • If premises have been damaged or destroyed, they are reinstated
  • T has complied with covenants in lease
150
Q

What negotiating parameters did you agree with client on the rent review

A
  • To be as accommodating as possible and not to damage L&T
    relationships
  • To be responsive in communications and seek a swift renewal
151
Q

How long does rent have to be outstanding to enact CRAR

A

Sum equivalent to 7 days outstanding

152
Q

What RICS guidance is there on service charges

A

RICS Professional Statement: Service Charges in Commercial Property (2018)

153
Q

What are the mandatory obligations for PM’s set out in: Service Charges in Commercial Property (2018)

A

1) Not to recover more than 100% of the proper actual costs
2) Service charge must be issued annually to tenants
3) A signed statement showing actual expenditure must be issued to
the tenant’s annually
4) All interest accrued on SC accounts must be credited to the
account
5) All costs must be transparent
6) The basis of apportionment must be fair and reasonable
7) When issuing statements of account of certifying expenditure PM’s
must act in a non-partisan way acting as experts
8) Independent review of the SC should be undertaken
9) Quality service must be produced ensure value for money is
achieved at all times, not simply lowest cost

154
Q

What acts must be considered in an assignment of the lease

A
  • Section 19, landlord and tenant act 1927
  • Landlord & Tenant Act 1988
  • Landlord & Tenant Covenants act 1995
155
Q

What is a hypothetical term

A

The length of the terms to be valued at a rent review

Will specified in the lease, if silent assumed to be the unexpired term

156
Q

How does the hypothetical term impact value

A

If longer than unexpired term = higher rent

If shorter = lower rent

157
Q

What degree of accuracy did you use for your measurements

A

3% for industrial

1% for office

158
Q

What is a section 146 notice and where is it found

A

Law and Property Act 1925

LL can serve for breach of covenant, if tenant does not remedy lease can be terminated

159
Q

What is the content of the UK national supplement (2023)

A

1 x PS
3 x VPS
17 x VPGA

160
Q

What are the three VPS from the UK national supplement (2023)

A

VPS 1 - Terms of Engagement (Red Book Compliance)
VPS 2 - Terms of Engagement (Supplementary Provisions in Scotland)
VPS 3 - Regulated purpose valuations

161
Q

What is the punishment for a LL breaching MEES

A

If the breach is for less than 3 months
- Higher of £5k or 10% of the RV
- Fine capped at £50k

If the breach is more than 3 months
- Higher of £10k or 20% of the RV
- Fine capped at £150k

162
Q

What valuations are exempt from the red book

A
  • Agency of brokerage work
  • Acting of preparing to act as expert witness
  • For statutory functions
  • For internal purposes
  • For litigation or negotiation
163
Q

Why would a landlord not opt their property for VAT

A

For marketing and letting purposes

If they are looking to let to companies who are exempt from paying VAT (charities, financial institutions) the VAT element would not be recoverable from the tenant

164
Q

What are the red book basis of value

A
  • Market Rent
  • Market Value
  • Fair value
  • Investment Value
165
Q

What is the purpose of RICS client money protect

A

RICS scheme to protection, as a last resort, in instances where an RICS Regulated firm is unable to repay a client’s money, up to the limits and exceptions set out in the scheme rules.

166
Q

What are the penalties for not having appropriate client money protection in place?

A

Fined up to £30,000 if you do not join a Client money protection scheme (Gov)

Fine up to £5,000 for not displaying certificate (Gov)

167
Q

What is on Workman’s Inspection checklist

A
  • Desktop H&S assessment
  • PPE (If necessary)
  • Diarise inspection with return time
  • Notify colleague of return time
  • Take fully charged phone
167
Q

What use class was Unit 4 Branbridges?

A

Classes B1, B2, B8 - Storage and Distribution (of bevs)

168
Q

What are the three common causes of defect

A
  • Water
  • Movement
  • Deteriorating materials
169
Q

What are common defects of modern industrial buildings

A
  • Roof leaks around roof lights
  • Cut edge corrosion
  • Blocked valley gutters
170
Q

What are the two parts of a Dunn and Bradsheet rating

A

Financial Strength Indicator (Letter)

Credit Risk Indicator (1 min - 4 high risk)

170
Q

What are the three tests for insolvency

A
  • Balance Sheet Test
  • Cashflow Test
  • Legal action test
171
Q

What are common defects for Modern office buildings

A
  • Cavity wall tie failure
  • Damp from the roof and ground
  • Water damage from burst pipes
  • Damaged cladding
172
Q

How long would you hold a lease on your data management systems

A

7 years after expiry

173
Q

What RICS Guidance relates to Licences to Alter

A

RICS Guidance Note, Licence for Alterations 2013

174
Q

What are the 3 types of dilaps schedule

A

Interim +3 years from expiry

Terminal -3 years from expiry

Final - Served after lease expiry when T is out of occupation

175
Q

What are the four types of SC apportionment

A

1 - Floor Area
2 - Fixed Percentage
3 - Rateable Value
4 - Weighted Floor Area

176
Q

What is your understanding of Jervis v Harris (1996)

A

Law in respect to LL’s right to re-enter the premises to undertake repairs

177
Q

What is the climate change Levy (CCL)

A

Tax on energy consumption for businesses in the UK, introduced as incentive to reduce energy consumption

178
Q

What are the five levels of BREEAM

A
  • Outstanding
  • Excellent
  • Very good
  • Good
  • Pass
179
Q

What is included in an actual rent review memo

A
  • Date of review
  • Reference to the lease
  • Parties to the lease
  • Disclaimer with amended rent
180
Q

What is the fee banding for SDLT

A

0-150k = 0%
+150-250k = 2%
+250k = 5%

181
Q

Name some basis principles of surveying safely

A

Personal responsibilities for RICS members and firms
Assessing hazards and risks
Workplace health and safety
Occupational hygiene and health
Visiting premises and sites
Fire safety
Residential property surveying
Procurement and management of contractors

182
Q

Name a key point from surveying safely

A

Introduced the safe person concept

= each individual assumes individual behavioural responsibility for their own, their colleagues and other H&S while at work

183
Q

When would you be required to report a RIDDOR incident

A
  • Over 7 days incapacitation
  • Must be reported to HSE within 15 days of the incident
184
Q

What legislation relates to fire safety

A
  • Fire Safety Regulatory Reform (2005)
  • Fire Safety Act (2021)
  • Fire Safety Regulations (2022)
185
Q

When is a written H&S policy required and what should it contain

A

Required for companies of 5+ people

Must contain
- Policy setting out firms H&S commitment
- Details of H&S structure
- Workplace Risk assessment
- Details of planning implementation of H&S policy

186
Q

What are the principles of GDPR

A
  • Information used lawfully, fairly and transparently
  • Collected for specified, explicit and legitimate purposes
  • Limited to necessity
  • Accurate (kept up to date)
  • Kept no longer than necessary
  • Kept safe
187
Q

Define encryption

A

The process of encoding information to make it more secure

188
Q

What are the three principles of Real Estate Management (2016)

A

-Conduct business in an honest fair transparent and professional manner

-Not discriminate in any dealings

-To utmost to avoid COI, and where they arise deal with them openly fairly and promptly

189
Q

What is the punishment for breaching Control of Asbestos Regulation (2012)

A
  • 20k fine
  • Up to 12 months imprisonment

More serious cases can be escalated

190
Q

What were the main updates in the latest red book

A
  • Reflect changes in the IVS published by IVSC
  • More detail on TOE when applying exception to VPS 1-5
191
Q

What valuations can be exceptions to red book

A
  • Agency of brokerage work
  • Acting as expert witness
  • Statutory purposes
  • Internal purposes
  • For litigation or negotiation
192
Q

What are PS1 & PS2

A

PS1 = Complying with UK law
PS2 = Ethics, competency, objectivity and disclosures

193
Q

Define Investment Value

A

Value of an asset to the owner or prospective owner for individual investment or operational objectives

194
Q

Define Fair Value

A

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.

195
Q

Give a basic method to Zoning

A

Use three zones (A,B,C + Remainder)

Zones of 20ft most commons

Then the zone area is halved back (48 sq ft for example)

A = 48sq ft
B = 48 sq ft/2 = 24 sq ft
C= 48 sq ft/4 =12 sq ft)
Remainder = 48 sq ft/8 = 6 sq ft

Then times cumulative sq fr ITZA by MR

196
Q

How would you value a ransom strip

A

1/3 of increase in value of development land which arises from access via ransom strip

Stokes v Cambridge Corporation [1961]

197
Q

Give a basic method to Profits Valuation

A

Turnover - less costs & purchases
Then Less
reasonable working expenses and operators remuneration

This is then capitalised at appropriate yield to give value

198
Q

What is the Bank of England Base Rate

A

5.25%

199
Q

What does the dual rate YP comprise of

A
  • Remunerative rate
  • Accumulative rate (adjusted for tax)
200
Q

What are the main three forms of investment

A
  • Gilts
  • Equities
  • Property
201
Q

What are the disadvantage of property as an investment

A
  • Low liquidity
  • High levels of management
  • High transfer costs
202
Q
A
203
Q

What form of arbitration is used for lease renewal disputes

A

PACT

204
Q

What has RICS published on Complaints Handling

A

RICS Guidance Note, Complaints Handling (2016)

205
Q

What is a green lease

A

A lease which contains additional provisions that impose an obligation on the L & T to manage and reduce the environmental impact of a property by way of improvements

206
Q

What does BREEAM Stand for?

A

Building Research Establishment Environmental Assessment Method

207
Q

What is the spec of an institutional spec industrial asset

A
  • 30 kn/m2 minimum loading capacity
  • Steel portal frame construction
  • Minimum 8m clear height
  • 10% lighting panels in the roof
  • 5-10% office space
  • Full height electric loading doors
  • Site cover of 40%
208
Q

Name some types of industrial building

A
  • Manufacturing
  • Cold storage
  • Light manufacturing
  • Warehouses
  • Data Centres
  • Showrooms
209
Q

What are defects for modern industrial buildings

A
  • Roof leaks around lights
  • Cut edge corrosion
  • Blocked valley gutters
210
Q

Name some common defects for modern office buildings

A
  • Cavity wall tie failure
  • Damp from roof and ground
  • Water ingress
211
Q

Define NPV

A

Sums of all the discounted cash flows of a project, used to determine viability of an investment

212
Q

What are the three types of obsolescence

A
  • Physical
  • Functional
  • Economical
213
Q

Describe the construction of 96-98 Kilburn High Road

A
  • Solid brick wall facade
  • Timber joist flooring
  • Ceiling height of 2.5 m
  • Single glazed windows
  • No raised floors or ceilings
214
Q

What were the build costs for your development

A

£650 per m2 for purpose built warehouse

215
Q

What was the interest rate for your residual

A

9%, standard for development funding

216
Q

What was the contingency

A

5%

217
Q

What was the site area for the residual

A

11,875 sq ft

218
Q

What was the floor area of the completed development

A

4,750 sq ft (IPMS 2)

219
Q

What are RAMS and where is their requirement set out

A

Risk Assessment Method Statement - In Managing H&S at work regulation (1989)

220
Q

What are the disposal costs in your residual

A

Letting Fees
Legal Fees
Tax

221
Q

What are the developers costs for your residual

A
  • Build costs
  • Demolition
  • Consultants fees
  • Interest on loans
222
Q

When did IRFS come into effect

A

1st Jan 2019

223
Q

What use class do Automotive repairs fall in?

A

B2

224
Q

Give me two example of deleterious materials

A
  • High Aluminia Cement
  • Iron Ore
225
Q

What is the net initial yield

A

Rent expressed as a percentage of the gross acquisition price

226
Q

What is the initial yield

A

Net income at date of purchase expressed as percentage of purchase price

227
Q

What is the spec of a grade A office

A
  • 2.6m floor to ceiling
  • 350mm suspended ceiling void
  • 150mm raised floor
  • 2.5-3 KN/M2 floor loading with additional 1 KN for partitioning
  • Double glazed window
  • Air con
  • Passenger lift
228
Q

What is a sinking fund

A

Fund set aside for replacing of wasting asset, e.g. lift

229
Q

What is a reserve fund

A

Fund formed to meet anticipated future expenditure, e.g. VRF replacement

230
Q

What are sustainable office procedures Workman uses

A
  • Recycling
  • Zero waste to landfill
  • Cycle to work scheme
231
Q

What is a Part 36 Offer

A

Under P36 of Civil Procedure Rules 1998

Offer to settle at a lease renewal

232
Q

How long is a part 36 valid

A

Minimum 21 days, will be stated on offer

233
Q

What must be included in a Calderbank Offer

A
  • Terms on which the party is willing to settle
  • “Without prejudice Save as to costs”
  • A proposal regarding costs incurred up to the date of the offer
  • Time limit for how long the offer is valid for
234
Q

Who can make a Calderbank offer?

A

Both LL and T

235
Q

What is black mould indicative of

A

Condensation

236
Q

What is a damp proof course

A

A physical barrier installed through the structure to prevent rising damp.

Is laid below walls

237
Q

What is the difference between gross and net yield

A

Gross yield = Rent expressed as a percentage of the purchase price

Net yield = Rent expressed as a percentage of the gross acquisition price (i.e. Including purchasers costs)

238
Q

What are the four requirements of a lease

A

1) Exclusive Occupation
2) Payment of rent
3) Duration for a specified term
4) If 3+ years, terms must be in writing, signed and registered as deed

239
Q

What defects can be seen in brickwork

A
  • Evidence of water entering brickwork
  • Efflorescence = salt reacting with water and leaving white marks
  • Spalling = bricks degrading because of heating & cooling of bricks
240
Q

What types of air con are there and what are the advantages / disadvantages

A
  • Variable Air volume = Higher costs but most flexible
  • Fan Coil = Lower initial cost but higher operating and maintenance cost
  • Variable Refrigerant Volume = Lower capital cost, but higher operating and maintenance cost
241
Q

What would occur after a building has completed construction

A

Snagging - i.e. inspect building against the plans to check it has been finished correctly. Carried out by a contractor under warranty

242
Q

What legislation relates to the contamination of land

A

Environmental Protection Act 1990

243
Q

Under what act is it a criminal offence to allow the spread of Japanese Knotweed

A

Wildlife and Countryside Act 1981

244
Q

Define GIA

A

The area of a building measured to the internal face of the perimeter walls at each floor area

245
Q

What would you include within a NIA measurement

A
  • Kitchens
  • Built in-cupboards
  • Areas occupied by perimeter trunking
  • Areas occupied by non-structural walls
  • Atria with clear height and entrance halls if not expressly included in the communal areas
246
Q

What would you exclude from NIA

A
  • WCs
  • Areas under 1.5m in height
  • Plant and lift room
  • Stairwells
  • Cleaner cupboards
  • Space rendered unusable (gap of 25cm or less)
247
Q

How do you calculate WAULT

A

Rental income * lease expiration time / total rent income

= Number of years

248
Q

What did the RICS publish in relation to valuation and the use of comparable evidence

A

RICS Guidance Note, Comparable Evidence in Real Estate Valuation (2019)

249
Q

Define equivalent yield

A

Weighted average yield between the initial and reversionary yield

250
Q

What would happen if a tenant didn’t respond to a S25 notice

A

At the expiration of the notice the tenant would lose their right to renewal, and the landlord would have the right to regain possession.

251
Q

What types of asbestos survey are there

A
  • Managment
    • Identifies location of asbestos and how to manage it, no samples taken
  • Demolition
    • Required when property is undergoing work, samples of material suspected to contain asbestos are taken and analysed
252
Q

According to the Control of Asbestos Regulations (2012), what are the five steps for the duty holder in managing asbestos

A

CRRAR (Contain, Risk, Register, Available, Review)

1) Assess whether premises CONTAINS asbestos
2) Assess RISK of it
3) Create an Asbestos REGISTER
4) Make register AVAILABLE
5) REVIEW the register regularly

253
Q

What are the future MEES dates

A

1st April 2027 - Minimum C

1st April 2030 - Minimum B

254
Q

Name some purposes of inspection

A
  • Valuation
  • Property Management
  • Agency
255
Q

Residual method

A

Gross Development Value from MR capitalised into perp at initial yield

 - Less developers costs & profit

= Net Development Value

  - *PV for a year @ interest rate

= GRV

  - Less agent fees, legal fees & SDLT

= Site Value

256
Q

What would the options be if there was a disagreement with the rent review

A
  • Real the lease to determine the method of determination within RR clause
  • Could be agreed between parties or by president of RICS (cost of £425)
  • Independent Expert of Arbitrator
257
Q

What is corporate social responsibility

A

Corporate Social Responsibility (CSR) is commonly defined as a business model in which companies integrate social and environmental concerns in their business operations and plans.

258
Q

Give an example of a time you have communicated effectively

A

When liaising with agents to obtain comparable.

Information was free of charge, agents not obliged to give out.

259
Q

What lease length is required for IRFS to apply

A

At least 12 months

260
Q

Give examples of information barriers

A
  • Physically separating two parties
  • Encrypting files
  • Safe channels of communication
261
Q

What is an SAR

A

Subject access request, demand that individual is given all the information a company holds on them

262
Q

What does PS1 relate to in the red book

A

Details when a valuation needs to be red book compliant.

263
Q

Define an assumption in the context of a valuation

A

An assumption is made where it is reasonable for the valuer to accept that something is true without the need for specific investigation or verification.

264
Q

What are Workman’s business aims and objectives

A
  • Achieve sustainable and profitable growth
  • Make positive impacts on communities
  • Maintain culture where people thrive and reach full
    potential
265
Q

Expand on the disability access audit you have carried out

A

Copthall

  • Identified a stairlift called be installed in the lobby up to
    the first floor
  • Picked up with client and had it installed via non-rec funds
266
Q

What is the occupiers liability act 1957

A

Duty of care by the occupiers to any lawful visitors.

267
Q

What is the occupiers liability act 1984

A

Duty of care by the occupiers to any trespassers

268
Q

When is duty owed under the occupiers liability act 1984

A

When I am

  • Aware of the danger on site
  • Believe that a person on site may be at risk
  • These risks must be managed to remove liability
269
Q

What are the changes in the UK National Supplement (2023)

A
  • To reflect changes in valuation standards & legislation
  • New governance standards for regulated purpose
    valuations
270
Q

What must be included in a S146 Notice

A
  • Specifying the breach
  • Requirement for tenant to remedy the breach
  • A reasonable to time to remedy the breach, length on case by case basis

Usually served by solicitors

271
Q

What can a tenant do if served with a S146 notice

A

Remedy the breach within a “reasonable time”

Pay reasonable compensation to the satisfaction of the L

Apply for relief under Leasehold Property Repairs Act 1938 S1

Above only applies for leases of 7+ years with 3 years to run

272
Q

What is the tenant’s procedure if applying for relief in response to a S146

A
  • Serve counter notice within 28 days under
    Leasehold property repairs act 1938
  • This prevents L from being able to take
    forfeiture proceedings until leave from the
    courts is secured
273
Q

When would the court give leave for a L to forfeit under the 1938 Leasehold property repairs act

A

Prove one or more of the following grounds apply

1) immediate remedying of the breach is necessary to prevent substantial damage or its value has already been substantially diminished;

2) The immediate remedying of the breach is necessary to comply with an enactment or by-law or similar matter;

3) The tenant is not occupying the whole of the premises affected and the immediate remedying of the breach is necessary in the interests of the other occupier(s);

4) The cost of immediately remedying the breach is small relative to the likely cost occasioned by postponement;

5) There are special circumstances which make the giving of leave just and equitable.

274
Q

How would a tenant register their improvements on a leasehold property

A

Follow procedure in S18 1927 L&T Act

1) Tenant serve a notice on L before works start
with details and plans

2) L has three months to object or offer to do
the work themselves in return for a
reasonable increase in rent

3) If L does not object or offer to do works, T can
proceed and complete works within an agreed
time period n

275
Q

What happens if a L objects to T’s improvements being registered under 1927 act

A

Courts will determine matter

276
Q

What happens at the end of a tenancy if any improvements are registered in accordance with the 1927 act

A

Compensation will be payable to the T

277
Q

How is compensation calculated under 1927 act

A

Shall not exceed the smaller of:

  • the net addition to the value of the property as
    a whole which is a direct result of the
    improvement, OR
  • the reasonable cost of carrying out the
    improvement at the end of the lease less the
    cost of putting the improvement into a
    reasonable state of repair
278
Q

What is the interim rent assessed as in a protected lease

A

Rent of the new tenancy unless L or T show otherwise

  • Different valuation dates
  • Different lease terms between tenancies
279
Q

What is a deeming provision

A

Where lease states the process for a rent review is:

  • L to give notice proposing new rent
  • T to serve counter notice with counter
    proposal within a stated period of time
  • If T fails to serve counter notice in time, T is
    DEEMED to have agreed L’s rent
280
Q

What happens if a T rejects a L’s Calderbank offer, and the arbitrator awards a rent equal/higher to the proposed rent

A

The arbitrator can award the fees to the T from the date the offer could have reasonably been accepted

281
Q

When was the L&T Act 1954 last amended

A

1st June 2004

282
Q

During an inspection what would cause an unsafe atmosphere in a building

A
  • Confined spaces with lack of oxygen
  • Mould or fungus
  • Rotting vegetation
  • Pigeon droppings
283
Q

Can the professional statement on Service charges override a lease

A

No

284
Q

Name another insavive species (apart from Japanese knotweed)

A

Himalayan Balsam

285
Q

What is the definition of IPMS 3.2?

A

The Floor Area available on an exclusive basis to an occupier measured internally to any Notional Boundaries, the Internal Dominant Face, Demising Walls and including any External Floor Areas, Sheltered Areas and Secondary Areas.

286
Q
A
287
Q

What is the reversionary yield

A

Market rent expressed as percentage of purchase price

288
Q

How is VAT dealt with in your rent demands

A

As application for payment, not a rent demand

289
Q

Why does your client opt for an application for payment rather than invoice

A

VAT, as VAT only becomes due on application for payment when payment is made

With invoice tenant VAT is due when the invoice is raised, therefore LL will be liable if T withholds funds

290
Q

What action do you take to limit risks in a vacant building

A
  • Drain down water
  • Vacant inspections every two weeks
  • Additional security if high risk
291
Q

What types of yield are used on Co-Star

A

Net Initial Yield

292
Q

List S32 - 35 of L&T 1954

A

S32 - Property Comprised
S33- Term (Max 15 years)
S34 - Rent
S35 - Other terms

293
Q

What case law relates to break clauses

A

Osbourne Assets v Britianna Life Ltd (1997)

T did not comply with conditions of lease (three coats of paint), therefore break held ineffective

294
Q

What would you do if a tenant becomes insolvent

A
  • Register claim for arrears
  • Inform insurers and client
  • Put tenant on rent stop
  • Ensure property is secure (if vacant)
  • Do not accept keys back as it could constitute surrender
295
Q

What is triangular cracking indicative of

A

Lintel failure

296
Q

What is horizontal cracking indicative of

A

Cavity wall tie failure

297
Q

Define NIA

A

Useable area within a building measured to the internal face of a perimeter wall

298
Q

What needs to be shown on company accounts

A

Governed by companies act 2006

  • Cover page
  • Contents page
  • Directors report
  • Accoutants report
  • P&L account
  • Balance sheet
  • Notes
299
Q

What is R22 Refridgerant

A

Gas used in A/C systems

Banned for new equipment in 2004 due to Ozone depleting properties

From 2015 use and replacement of new low temp refrigerant is illegal

Being phases out

300
Q

When did the UK adopt IRFS

A

31st December 2020

301
Q

What did IRFS replace

A

International Accounting Standards (IAC)

302
Q

Give me an example of an environmental management system

A

ISO14001 - International agreed standard that sets out requirements for an environmental management system

303
Q

Define contamination

A

Making something inpure by contact with something unclean or harmful

304
Q

What are carbon budgets

A

5 yearly budgets set by the government, restrict the amount on greenhouse gas the UK can release over 5 year period

Current one 2023-2027

305
Q

Give examples of sustainable design features

A
  • Good insulation
  • Sustainable construction materials
  • Renewable energy source
306
Q

When do you need to display an EPC

A
  • Floor area over 500 m2
  • Frequently visited by the public
307
Q

Name some asbestos containing materials

A
  • Insulation lagging
  • Insulation boards
  • Roof and wall cladding
308
Q

What is an inherent defect

A

A defect in the design or material which has always been present

309
Q

What is a latent defect

A

Fault in the property which could not have been discovered through inspection

310
Q

What is a sensitivity analysis

A
  • Adjusting variables in a calculation to see how it would react in a different circumstances
  • E.g. in RLV
311
Q

What is the basic method for a DCF

A

1) Estimate cash flow (income less expenditure)
2) Estimate exit value at end of holding period
3) Select discount rate
4) Discount cash flow at discount rate
5) Value = sum of cash flow (NPV)

312
Q

What is the discount rate for a DCF

A

An expression of the time value of the money in the DCF

313
Q

What is a competent landlord

A

Defined in section 44 of L&T Act 1954

= The person whom notice must be served upon or serve notice

Either freeholder or superior tenant with unexpired terms of over 14 months

314
Q

What would you advise the landlord would do if the unit is over-rented and the tenant hasn’t served any notice

A

No action, allow the tenant to stay in occupation under S24

315
Q

What is the difference between IPMS 3 Office and NIA

A

In IPMS 3

  • Perimeter measurement taken to internal dominant face
  • Areas under 1.5m in height measured but stated separately
  • All columns included
  • Covered galleries for exclusive use of one tenant included but stated separately
316
Q

Define shop depth

A

Measured from the national window display to rear of retail area

317
Q

What is a section 18 valuation

A

Valuation Under 1927 L&T Act to define the amount of damages that a landlord is able to recover for a breach of the tenants repairing covenant

318
Q

What companies are exempt from GDPR

A

Organisations with fewer than 250 employees

319
Q
A
320
Q

What is the structure of the red book

A

1) Introduction
2) Glossary
3) Professional Standards
4) VPS
5) VPGA
6) IVS

321
Q

What are PS1 & PS2

A

PS1 - Compliancee with standards where a written valuation is required

PS2 - Ethics, Competency, Objectivity & Disclosures

322
Q

What does VPGA stand for

A

Valuation Practice Guidance - Applications

323
Q

Is a SC audit mandatory

A

Only if stated in lease

324
Q

What is Biodiversity Net Gain

A

Mandatory under Town and County Planning Act 1990 (As inserted by Environmental Act 2021)

States developers must deliver a BNG of 10%, i.e. development results in better quality natural habitat than before

325
Q

Can you use NIA in SC budgets despite IPMS being mandatory?

A
  • IPMS not mandatory for SC apportionments, client can opt for NIA
326
Q

What has the RICS published on Sustainability

A

RICS Guidance Note - “Sustainability and ESG Guidance in Commercial Property Valuation and Strategic Advice” (2021)

327
Q

How would you ascertain a yield if there were no comps

A

Use BOE base rate or gilts then add degree of risk
- from building age etc

Would give ARY

328
Q

Define bribery in your own words

A

Offering, giving or receiving an item/action of value in order to influence the action of another person

329
Q

What % of emissions is the built environment responsible for?

A

c.40%

330
Q

What has the RICS written to demonstrate their commitment to sustainability

A

RICS Futures Report (2020)

Highlights importance of industry adapting to climate change

E.g. Using drones & building roads from plastic bags

331
Q

What are the four common forms of foundation

A

1) Trench
- Used for resi

2) Raft
- Slab that spreads load over whole site
- For lightweight structures and soft soil

3) Piled
- Long and slender concrete cylinders
- Used for high loads

4) Pad
- Slab foundation system
- Under individual columns so load is spread
evenly

332
Q

What updates have been made to the TCP 1987 Act

A

Introduction of E class in September 2020

Used to provide flexibility to change premises use without need for planning permission

Amalgamates

  • A1, A2, A3, B1, D1, D2
333
Q

What is the formula for YP for a term

A

1-yield

334
Q

Define nominal yield

A

Assumes yield is paid in arrears

335
Q

Define true yield

A

Assumes rent is paid in advance

336
Q

What can a developer receiver if developing on a contaminated site? (Thus removes contamination)

A

Land remediation relief

  • Form of tax relief that gives developer up to 150%
    corporate tax relief
337
Q

What are the pros and cons of independent expert determination

A

Pros
- Expert decision based on own option and advice
- Time and cost effective

Cons
- No statutory back up
- Limited right of appeal

338
Q

How do you avoid conflicts in the first place

A
  • Clear drafted lease
  • Proactive risk analysis
  • Good record keeping
  • Following RICS Rules of conduct
339
Q

What are the pros and cons of arbitration

A

Pros
- Fast, cost effective and confidential
- Have specialised knowledge of subject area

Cons
- Limited right of appeal
- Parties bear their own costs

340
Q

What are the four types of discrimination

A
  • Direct
  • Indirect
  • Victimisation
  • Harassment
341
Q

What does the equality act mean for landlords

A

LL may not discriminate against a person on basis of protected characteristic

342
Q

Tell me something about the companies act

A

Replaced Companies Act 1985

Governs format of company accounts

is the primary source of UK company law

343
Q

Why was IRFS introduced

A

Global consistency is financial reporting

344
Q

How is gross profit calculated

A

Turnover - Cost of sales

345
Q

What are reasonable grounds for refusing consent for an assignment

A
  • Character of proposed assignee
  • Weak covenant strength
  • Impacting trade of other businesses (i.e. Retail
    Park)
346
Q

What an in-court PACT

A

Used for unopposed new tenancy where an application to court to fix new terms has already been made.

347
Q

What is an out-of-court PACT

A

Where no application to court has been made

Agreement to postpone application until out-of-court PACT has been resolved

348
Q

What does without prejudice save as to costs mean

A

Without prejudice applies until court delivers judgement

Court will then award costs

349
Q

What RICS guidance is there on dilaps

A

Guidance Note, RICS Dilapidations in England and Wales (2016)

350
Q

What is the timeframe to responding to a dilaps claim

A

56 days

SOE (4 decks)

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