Summary of Experience Flashcards
What is the layout of the Rule of Conduct 2021 (effective 2022)
Intro, rules 1-5, appendix A
What is appendix A in the rules of conduct 2021 (effective 2022)
Professional obligations.
Members:
- cooperation with RICS, CPD, providing information when requested.
Firms:
- complaints handling procedure, PII, cooperation with RICS.
What were the changes in the rules of conduct 2021 (effective 22)
Simpler structure, clear examples, focus on respect, diversity and inclusion, technology, role of members in tackling global challenges.
What are the five rules of conduct
Honesty & Integrity
Competence
Service
Respect
Responsibility
What are the 6 key principles in the Bribery Act 2010
Proportionality
Top level commitment
Due diligence
Risk assessment
Communication
Review
What are the penalties under the Bribery Act 2010
Max 10 years in prison, unlimited fine, disciplinary action or expulsion from RICS.
Policed by serious fraud office.
What is a COI
When impartiality is threatened by the existence of a conflict between two parties.
What guidance does the professional statement on COI 2017 give?
Informed consent, when to reject an instruction, workman example would be one client buying a property from another, but you work different offices and therefore there’s a barrier.
What is the guidance note on commercial property management in England and Wales effective from 2011
Details a PMs core duties.
- Liaising with the landlord
- managing 3rd party suppliers
- Collection of monies
- Service charge
- Deposit
- H&S
- Management fees
Key principles within SC in Commercial Property 2018?
- Expenditure recovered must be in line with the lease
- Shouldn’t seek to recover more than 100% of costs,
- Budgets with explanation to be issued annually,
- Reconciliations showing actual spend annually,
- Must provide service charge apportionment annually, - Monies should be held in discrete bank account, any interest must be credited,
- Tenant should only withhold sums in dispute,
- Anything raised incorrectly must be corrected without undue delay.
What is Workman’s complaints handling procedure
Acknowledge within 7 days. Investigate within 28 days. Refer to our complaints handling officer if necessary or via ADR, property redress scheme.
Talk me through your Christmas gift you received from a contractor?
- This was from a security contractor who I had worked closely with over the course of the year.
- I received a hamper worth £50 at our office.
- This was in proportion to the amount of work carried out together. Therefore I accepted but informed them it would be added to Workman’s gift register as per our gift policy.
- The gift was then raffled.
What is a bribe?
A bribe is to dishonestly persuade someone to act in ones favour by offering a gift or money
Talk through the LTA at Nursling and how it applies to ethics?
- Received phone call from tenant explaining Southern Water are keen to add drainage tanks to their unit. Due to flooding into the River Test during heavy rainfall.
- They asked if this was ok and wanted to keep costs down.
- However not my area of expertise therefore I had to advise building surveyors would need to review and approve the plans first.
Negotiation principles at Workman?
- Only negotiate on a subject I’m competent in
- Communicate well with client
- Ensure legal compliance
- Document any finalised agreements
what H&S guidance is there?
RICS professional standard: Surveying Safely: Health and Safety Principles for Property Professionals, 2nd edition (2018).
What is in Surveying safely?
- Assessing risks and hazards
- RICS members’ places of work (physical ability, age, culture, language, location)
- Occupational hygiene (stress, health, bullying, noise, air quality)
- Visiting sites (checklist, lone working, site rules, PPE)
- Fire safety
- Procurement (check what the work will involve, is contractor competent, provide info before works start, check sufficient insurance, if necessary, monitor the work).
How to carry out a risk assessment?
identify hazards, who might be harmed, evaluate risk, record findings, review the assessment, advise those affected on the outcome) (grade severity of potential outcome (1-5) 5 being fatal and grade the likelihood of occurrence (1-5) 5 being certain to get a graded score of e.g., 25 i.e., fatal and certain.
What H&S seminars have Workman done?
Asbestos awareness and legionella
What is asbestos
Asbestos is dangerous when disturbed – Its fibres can cause serious diseases like mesothelioma, lung cancer, and asbestosis when inhaled.
It’s still present in many UK buildings – Especially those built or refurbished before the year 2000, as asbestos was widely used in insulation, ceiling tiles, and pipe lagging.
You must not disturb it unless trained – Surveyors and contractors need proper asbestos awareness training, and any removal must be done by licensed professionals.
What is legionella
Legionella bacteria grow in water systems – Especially in warm, stagnant water (20–45°C), like in cooling towers, tanks, or rarely used taps and showers.
It causes Legionnaires’ disease – A potentially fatal type of pneumonia, usually contracted by inhaling contaminated water droplets.
Landlords and duty holders must manage the risk – Under health and safety law, you must carry out risk assessments and maintain water systems properly to prevent outbreaks.
What H&S systems do you use at Workman?
Quooda, Riskwise, Inspection tracker.
What is a general risk assessment?
At an industrial estate, a GRA might assess risks like:
Vehicle and pedestrian collisions in shared yards
Uneven surfaces or potholes
Poor lighting
Asbestos in old buildings
Fire hazards from tenant operations
It’s a general look at all potential hazards on a site, not specific to one task or person.
what is a FRA?
The FRA checks how well the site is protected against fire, and what needs fixing to keep people safe.
Escape routes – Are they clear and signposted?
Fire alarms – Are they working and tested regularly?
Fire doors/extinguishers – Are they in place and maintained?
Tenant activities – Any high fire-risk processes or materials?
Electrical safety – Are systems up to standard?
What is the occupiers liability act 1957
It states that the landlord we have a legal duty to ensure the estate is safe and free from health hazards for visitors.
What’s Occupiers’ liability act 1984?
– Extends duty of care to trespassers.
What is Regulatory reform (fire safety) order 2005
It requires annual fire risk assessments and puts the duty of care on the landlords and tenants to ensure fire safety compliance.
What is the risk engineering report at unit 1 Nursling
A report carried out by insurers to identify major loss potentials. The report raised that they needed an up to date electrical systems certificate and to move some pallets that were against the building.
I advised the tenant of this and a week later they sent me an updated certificate and photos of the yard.
I later confirmed by inspecting the unit.
What is IFRS
IFRS stands for International Financial Reporting Standards, a set of accounting rules used globally to ensure companies’ financial statements are consistent, transparent, and comparable. They provide guidelines on how to report financial transactions, making it easier for investors and other stakeholders to understand a company’s financial health.
What is IFRS 16
Means leases are on the balance sheet. Can be complex when dealing with sale and leaseback and adjustments are needed to be made to reflect fair value.
What is IFRS 13
It defines fair value
Whats the format of a companies accounts
company info, strategic report, directors report, auditors report, P&L, balance sheet, changes in equity, cash flow statement (for medium and large companies) and lastly notes to the account.
What is the P&L account
Profit and loss statement outlines a company’s revenue, costs, and expenses over a year.
What is a balance sheet
shows:
assets, liabilities, and shareholder equity. i.e., what a company owns, owes and is owed.
whats an asset
Cash, inventory, equipment
whats a liability
rent, wages, loans
How do you calculate worth
assets - liabilities = worth
why is it useful to see a tenants cash flow statement
A cash flow statement is useful because it shows how cash moves in and out of a business, helping to assess its liquidity, ability to pay bills, and overall financial health. It highlights whether a company is generating enough cash to sustain operations and fund growth.
what guidance is there on client money
Client money handling 2019 professional standard
What’re the six rules within client money handling 2019
- Account needs to be named client (managed by a CA) and kept separate
- Provide details to clients. e.g., regular statements
- Receipts of client money. Ensure proper procedures are followed when receiving client money.
- Payments from account. ensure clear protocols are agreed. e.g., client approval for large sums.
- Maintain accurate record of all transactions.
- Compliance. comply with RICS rules.
Why are arrears / completion statements checked by CA?
- Ensures accuracy, they are more competent in this area, adheres to RICS best practice that you should consult with appropriate financial experts when dealing with complex accounting matters.
When have you engaged with auditors?
- Websters carry out our recs. This ensures accuracy, compliance, prevents fraud, and improves financial management
Whats uk GAAP
UK GAAP is the set of rules UK companies use to prepare their financial statements, covering how to report income, expenses, and assets. It ensures consistency and transparency in financial reporting.
What are the 10 princples of GAAP
Regularity, consistency, sincerity, non-compensation, prudence, continuity, periodicity, materiality, good faith and utmost good faith.
Talk through unit 2 Botany rent concession
Windsor Print, rent concession tenant request to pay monthly, reviewed accounts, acknowledged it was a fair request. Asked client accountant to review, advised client and proceeded to agree.
what guidance is there on COIs
RICS Professional Standard: Conflicts of Interest (2017)
what is a COI
- A COI occurs when someone’s personal interest could potentially influence their professional judgment or actions.
How can you manage a COI
- Informed consent is when both parties continue and put in writing all the facts of the COI.
- They can be managed through an information barrier.
What is dispute resolution
Dispute resolution is the process of resolving conflicts between parties, either informally (e.g. negotiation), through alternative methods like mediation or arbitration, or formally through litigation in court.
What is arbitration
- Arbitration is a formal method of resolving disputes. A third party makes a binding decision about hearing both sides.
what is an independent expert
- An expert in the field makes a binding decision, they can use their own knowledge. (can be sued for negligence)
What are the six GDPR principles
- Lawfulness, fairness and transparency
- Purpose limitation
- Data minimisation
- Accuracy
- Storage limitation
- Integrity and confidentiality
What’s Data protection act 2018.
- who enforces non compliance?
- Uk’s implementation of GDPR. Includes power for the ICO to enforce non-compliance.
How do your systems - tramps , yardi , efs stay secure?
- Our data portals. Encrypted, two factor authorisation, change password monthly.
Penalty for not complying with gdpr ?
- Data noncompliance up to £17.5 mill or 4% turnover whichever higher.
Talk through the handover at Arlington
- We had to securely transfer all relevant data including tenant information, leases, SC accounts, safety documentation. Ensuring compliance with GDPR e.g., up to date data, accurate data. I made an up-to-date tenant contact spreadsheet.
so you track insurance on RiskWise for the LIF fund. what was your client advise?
- I advised the client on which tenants could be recharged their insurance premiums and which costs the landlord would need to cover.
What client advise is given in LIF management meetings? Data wise…
- I advised charging interest after reviewing the lease.
- Regarding inspections I advise on upcoming visits so they can join and share any data gathered whilst on an inspection. E.g., occupancy rates of 6 care homes.
What advise was given from the PAIF audit?
- Advised the client on whether compensation is due from a break date not being actioned.
- Similarly, advised if interest on a rent review can be raised.
What are the Protected characteristics under equality act 2010.
- Age, disability, gender, marriage, pregnancy, race, religion, sexual orientation.
what is unconscious bias?
- It refers to attitudes that influence our decision, actions and judgments without us even realising. Formed by experiences, background etc.
what’s Workman’s lone working policy?
- Any site visits must be clearly noted in shared diary with partner and PA, must let them know when you leave and expect to return to office and take a fully charged phone.
what do you do on SC inspections?
- Checking services have been carried out, flag any issues, talk with tenants, gauge level of business.
what is your inspection procedure?
- Before, risk assessment, plan route, notify tenant, print title plan and past inspection.
- During, assess any hazards outside, check safe to enter, PPE, photographs.
- After, document report, contact tenant about key points.
Talk through the signage issues at Logistics City
Selco added to unit Cs slot which was empty / vacant.
- Minor signage issue flagged on inspection whilst with FM. Explained to tenant it needed to be removed as the space is for a vacant unit.
- Their site manager emailed a photo confirming it had been removed.
Talk through the leak at Asda
- FRI lease, tenant responsible for repairs. Flagged to my contact at Asda, he was not aware so escalated to ensure the roof was fixed.
- I advised my client of the leak following inspection and recommended we push Asda to fix this in a one-month time period before escalating.
What do you mean by the Elflock properties were in a bad state?
Elflock properties are pubs with a trading floor that presented ok, but the upstairs areas were neglected and used for storage. The condition was poor, with holes in the walls, collapsed ceilings, pigeon infestations, and significant bird droppings.
What type of schedule was served on Elflock
- Interim schedule of dilapidations was being put together by the BC. Tenant can have 28 days to remedy but dependent on the lease and extent of repairs. This case it was 6 months.
When is an interim schedule of dilaps served?
- Interim schedule is served when there is more than three years left to run.
Talk through what you did when you saw an unauthorised alteration at Evri, Crawley.
- During an inspection I flagged a new warehouse at the rear of their unit which had been built and was being used as extra storage.
- This was a breach of lease
- Retrospective LTA instructed BC and CMS to review after I’d obtained costs.
- My client advise was that this was a significant structure and therefore, needed to be documented, I also advised that the landlord would not be required to cover any of the costs.
What are the key points in L&T Act 1927?
Governs LTAs:
-Damages limited to the reduction in value to the Ls property caused by the Ts breach.
- LTAs, permission not to be unreasonable withheld.
- Improvements compensation, compensation payable when the tenancy comes to an end. Compensation - The amount payable will be whichever is lower:
(i) the increase in the property’s value from the improvement, or
(ii) the cost of doing the improvement, minus any repairs needed at the end of the lease.
e.g., tenant spent 10k on lights thatre now worth 8k.
- What is the procedure for alterations? as per the L&T act 1927
- How long does L have to respond
- What grounds must be satisfied if the L objects
- L&T Act 1927 procedure: T must serve notice on L before works start with plans, L has 3 months to object or offer to do the works himself in return for increased rent. If L does not object or offer to do the works, T can proceed and must complete works within agreed time. If the L objects, can be determined by Court (must be satisfied: i. improvement is of such a nature as to add to the letting value of the property at the termination of the tenancy ii. reasonable and suitable iii. does not diminish the value of any property belonging to L.
What does the L&T Act 1954 do.
- Provides security of tenure to tenants and regulates lease renewal processes.
- Automatic right to renew unless landlord can oppose under specific grounds.
What is S30 under the 54 Act
grounds A-G, breach of repair, persistent delay in paying rent, other substantial breach, provide suitable alternative accommodation, uneconomic subletting of part, demolition or reconstruction, owner occupation (L for > 5 years).
What is S40 of the 54 Act
- S40 is Duty to give information.
- In short, Section 40 ensures tenants can get the information they need about the landlord’s interest in the property, which may be relevant to their legal rights under the lease renewal process.
what did the L&T Covenants Act 1995 do?
Replace privity of contract.
- 1995 act introduces an AGA. Assignor of the whole premises is released from T covenants. However, S16 entitles L to require an assignor to guarantee the performance of the covenants by the assignee T. Assignor released upon lease expiry or a further assignment.
How do you pursue an AGA or guarantor ?
Serve a S17 under the L&T Covenants Act 1995, within 6 months of the debt.
How does an interim rent work?
- Apply to court for an interim rent under section 24A of L&T 1954.
- Rent that is paid between the end of the original tenancy and the start of the new lease. Either party can also apply to the court to determine whether interim rent is required.
- Can be included as part of lease renewal court proceedings, or as a stand-alone application.
what assumptions are there in rent review clauses?
Available to let on open market (between willing L&T), property fit for immediate occupation and use, T has complied with its covenants in the existing lease.
What disregards are there in rent review clauses?
T’s previous occupation, any goodwill, certain improvements (LL consent), any license to sell intoxicating liquor if belongs to T.
When do you consult your clients solicitor?
- Use for complex matters when their expertise and competency is required. Also, for documenting LTAs, lease renewals etc.
how did you calculate the Upham rent reviews?
Upham for example has 14 leases. Upward only, based on the consumer price inflation figures.
- Calculation R*B/C
- Initial rent figure times by RPI base figure divided by RPI figure from month preceding rent review.
- Capped at 5% collared at 1%.
- Send to client for approval, send to tenant for agreement. Then send to solicitors to document via a RRM.
talk through the surrender of unit 21-22
- Surrender is where the L&T agree to release the tenant from its obligations. Can be more nil premium.
- Agreed here because the LL wanted to redevelop, and the T paid a premium.
- TR1 with land registry transferred title back to the landlord. And deed of surrender documented and signed.
- £200K premium, £90K annual rent until 2027. Great deal for LL.
Talk through how you undertook the rent review at unit 10 botany trading estate.
- First step – competency check and conflict of interest check.
- Next step refers to the lease, and legal portal for any alterations documented.
- Check if time is of the essence. Review assumptions and disregards.
- Undertake an inspection.
- Get comparable from the estate, 25 units on the estate provide perfect comparable. A few from wider area using Co Star.
- Provide written recommendations to the client.
- Serve notice on the tenant. Stone Marketing.
- Negotiate. Some comparable on the estate had £11 psf but they were slightly newer than unit 10 here therefore £10 psf was agreed. 5,000 square feet, £49,000 rent.
- I said £52,000 they countered with £48,000.
- Dispute here went to independent expert which my client did not want, to save time and costs.
- we settled in the middle with 50k
- Agreed and signed RRM documented.
- A deeming provision says what happens if the T doesn’t respond within the time limits. Sometimes its deemed to have been accepted.
Talk through the lease renewal at unit 3 hampton business park.
- confirmed landlord wanted to serve non hostile section 25
- COI check and terms of engagement
- reviewed the lease and other documents
- inspect (check for alterations, condition and occupation I.e., correct tenant still trading)
- review market evidence which showed around £22/ sf (units 9,000 sqft)
- Heads of terms on same terms as existing lease but with a rent increase to £200,000
- 5-year review upwards only to market rent and a
- Break, tenant only subject to six months prior written notice.
- Negotiation with the tenant. They had similar comparable evidence therefore, negotiation was short.
- Lease drafted by solicitors and signed by both parties.
- I saved safely and updated our lease data.
what guidance is there on real estate?
RICS Professional Statement Real Estate Management 3rd Edition 2016
what guidance is within RICS Professional Statement Real Estate Management 3rd Edition 2016?
- Sets out principles of fairness and transparency that underpin activities undertaken by managers.
- Acting in client’s best interests.
- Complying with RICS ethics and rules of conduct.
- Lease and tenant management.
- Health and safety compliance.
what guidance is there on property management?
RICS Guidance Note – Commercial Property Management 2011
what guidance is within commercial property management 2011?
- Sets out core duties and how managers should act and in particular how they manage, communicate and control income and expenditure and minimise various associated risks.
- Service charge best practice notes e.g., budgets should be clear and justifiable.
what are the timelines for budgets and recs?
- Budgets one month before start of service year.
- Reconciliations issued within four months of service year end.
why did you crar unit 2 nursling industrial estate
- Uplift outstanding 6 months. Advised client to CRAR. Following informing tenant by COB we would CRAR they paid in full.
how did you deal with the arrears at walthamstow lockwood way
- On LIF the Walthamstow council persistently paid late but my client did not want to CRAR; therefore, after reviewing the lease we threatened to charge interest on future late payments.
what was the step by step process of the lta at unit 2 hampton business park
- I advised my client to approve these works as they would enhance the units value and align with ESG considerations.
- Screwfix rolling out air source heat pumps across their portfolio.
- Asked the client if they were happy to proceed.
- Confirmed fees before progressing. PM, BC and legal fees to be paid by the tenant.
- T submitted plans.
- Workman BC reviewed documents.
- Once agreed solicitors documented the LTA.
- Lastly inspected with BC to confirm works were carried out accordingly.
how did you review the covenant of the proposed assignee at unit b logistics city?
by reviewing 3 years audited accounts. 3 years because 1 is not a clear picture of ups and downs. Audited because externally verified reducing the risk in any misleading information.
additionally already existing tenant on estate and no arrears issues.
what is an assignment ?
- An assignment is essentially selling the lease to a third party. The transfer requires landlord consent, not to be unreasonably withheld or delayed.
could you refuse the assignment at logistics city?
- Grounds for refusal: character of the proposed assignee, effect on rental values, covenant strength.
what is the profit test when checking a tenants covenant strength?
- L looks for T profit to 3 x exceed the annual rent, SC and insurance.
what was your client advise with unit b logistics city assignment
- I advised we include an AGA to the assignment to ensure continued landlord protection.
- S17 of L&T covenants act allows LL to claim against guarantor within 6 months.
please talk through the licence at unit 8b nursling
- Agents engaged with 8a. they were at max capacity and hence being shown the other vacant units on the estate, particularly next door 8b
- I recommended to my client we could agree a short-term licence. Solicitors formally documented this.
- It provided an income flow, unit security and improved L&T relations whilst a lease negotiation was taking place.
what is a licence?
A licence is where the landlord grants a tenant permission to use the property or land for a
specific purpose. A licence may be for a fixed term or ongoing.
differences between lease and licence?
- a licence does not grant the tenant ‘exclusive possession’ of the property
- licences do not create a legal interest in the land and cannot be assigned to another party.
- Most licences give both the landlord and
tenant the right to terminate the
agreement at short notice and have less onerous conditions.
what is the case law around lease vs licence?
Street v Mountford
Established the key legal distinction between a lease (tenancy) and a licence. The House of Lords held that if a person has exclusive possession, for a term, at a rent, then it is a lease—regardless of what the agreement is called. This case prevents landlords from avoiding tenant protections by labelling leases as licences.
what is the legislation on measurement?
RICS Professional Statement: RICS Property Measurement, 2nd edition (2018)
Code of Measuring Practice, 6th edition (2015).
what is the rics property measurement 2018
- Introduces IPMS. Global consistency.
- Mandatory for RICS members, you have to justify a reason for using another standard.
- Covers office, resi, industrial.
what is the code of measuring practice 2015
- Defines GEA, GIA and NIA.
- Still relevant in UK markets and often used alongside IPMS.
Who is the RICS President,
previous president and
current president elect,
CEO
Justin Sullivan
Tina Pailet
Nicholas Maclean
Justin Young
what measurement did you do for craven house.
I did both NIA and IPMS 3
why did you carry out a measurement of 2nd floor at craven house?
Client wanted to check records were correct before they market, previous info was old.
what were the differences in your two measurements of craven house?
The unit had large glazed windows, so the Internal Dominant Face (IDF) was the internal face of the glazing. Therefore, window recesses and areas behind sills were included in IPMS 3, but not included in NIA.
There were several structural columns and full-height internal walls, which were included in IPMS 3 but excluded in NIA.
A lift lobby was accessed through a set of doors, forming part of the common parts. It was therefore excluded from both IPMS 3 and NIA as it fell outside the demise.
The unit did not include any areas below 1.5m in height, so no adjustments were needed for that under IPMS 3.
Overall, the IPMS 3 figure was higher than the NIA, primarily due to inclusion of window areas and internal columns.
why did you carry out a measurement of 1220 arlington business park?
SC Query. Downsized to occupy half a floor. Therefore, tenant requested a new measurement for apportionment
why did you measure 1220 using both nia and imps 3
- Used IMPS 3 because compulsory for offices and all future measurements are Arlington were going to include IPMS. Still used NIA because the SC apportionment was based on NIA.
what is the IDF of an ipms3 measurement
The Internal Dominant Face (IDF) is the inside surface of a wall that makes up more than 50% of the vertical surface from the floor up to 2.75 meters high (or up to the ceiling, if it’s lower).
- If 50% does not occur… “the finished surface is deemed to be the IDF.”
(NIA Measured to internal face)
how did you measure the dividing wall at 1220
what was the scale of the plan?
Common wall measured to internal face with NIA but measured to midpoint with IPMS 3
Do this by using the plans. 1:1250 scale.
i.e., 1 cm is 12.5m IRL
what measurement tool did you use
A bosch laser disto
5 methods of valuation ?
- Comparable, investment, residual, profits and depreciated replacement cost
What are contemporary valuation techniques?
- Discounted cash flow method. DCF.
- Used when valuing projected future cash flows. Discount rate applied to determine present value.
- Useful when multiple income streams e.g., retail.
what guidance is there on valuation?
RICS Valuation – Global Standards 2022 aka the red book
what are the requirements for RICS Valuation – Global Standards 2022
- COI checks, assumptions, disregards, valuation report content, compliance with GAAP and IFRS.
what guidance is there on comparable evidence?
RICS comparable evidence in real estate valuation 2019 (re-issued as professional standard in 2023.)
what does RICS comparable evidence in real estate valuation 2019 advise
- Selection of comps – size, age, condition, location.
- Verify data.
- Adjust comps for key factors.
- Weight and rank comparable evidence.
- Note any limitations or lack of comps.
talk through your valuation of unit 20 botany trading estate.
- Using the investment method, I calculated the MV based on comparable evidence.
- i used £10 p/sf which gave £60K
- Yield of 6% based on comparable and yield reports for industrial yields in the UK. I adjusted the yield upwards to reflect the secondary tier condition and not in a prime location such as London.
- £60,000 × (1/.06) = £1,000,200
- Less acquisition costs 1.8%, less SDLT = Market value (18K)
- SDLT: 0% up to £150K
-2% on £150-250K
-5% on £2250K plus.
-£40K total here. - MarketValue=£982,000−£40,000=£942,000
talk through your valuation of unit 16 botany trading estate
- unit Currently vacant,
- client requested valuation on special assumption it would be let
- I gathered comparable evidence, unit recently refurbished
- confirmed a Market rent of £75K based on a £10.50 psf (7,000 square feet)
- I used a yield of 6% used. Due to yield reports, and risk
- 75k capitalised into perpetuity at 6% = £1.25 million gross acquisition price.
- Less acquisition fees and SDLT gave the market value of £1.1 million
- I then applied the Special assumption the property is let on defined terms. I reduced yield to reflect the fact the property is let.
- 75k capitalised at a 5.5% yield = £1.36 million
- minus sdlt and fees
- This improved the MV to £1.28 million.
what is MEES 2018
- Minimum Energy Efficiency Standards – From April 2023, there is a prohibition on commercial landlords continuing to let properties with a sub-standard EPC rating i.e. ‘F’ or ‘G’, unless an exemption applies.
penalties for not complying with MEES?
- penalty for not complying with MEES? Depends on length of breach, if breach < 3m £5k or 10% of RV (up to £50k. >3m £10k or 20% of RV up to £150k
what are the upcoming EPC changes?
- Since April 2023 it has been illegal to let or continue to let properties with EPCs below an E. Noncompliance can be fines up to £150,000.
- From April 2025 all rented commercial properties must possess a valid EPC
- Minimum requirement will be a C from April 2027 and a B from 2030.
What ESG reporting do you do at Workman ?
- Providing CBRE ESG team with meter reads, and information such as tenant contact details or access arrangements for EPC surveys.
what properties are exempt from needing an EPC
- Exemptions: places of worship, listed buildings, stand-alone buildings with less than 50 square meters, buildings due to be demolished provided they have planning permission.
How many grades are there for an EPC?
A-G
How long is an EPC valid for>
10 years
what are the EPC requirements for existing leases
- Minimum of E required before being let or having a lease renewal. Existing leases from April 2023 new leases from April 2018.
what remedial works were carried out on the F rated EPC vacant building you flagged.
Upgrade to LED lighting: Replace older fluorescent or halogen lighting with energy-efficient LED lights.
Install double glazing: Replace single-glazed windows with double glazing to improve heat retention.
Went from an F to a D
8b nursling pretend.
what happened to the EPC rating at unit 3a botany trading estate
- During lease negotiations it was identified the EPC was an F
- Below the MEES regulations.
- Proposed improvements were removing an air heater and replacing it with split systems
- Tenant refused
- Therefore, client sought to register MEES exemption under consent exemption provisions.
- A letter was arranged and signed by the tenant to document their refusal.
is tenant refusal a valid reason to not comply with mees
Yes, it’s allowed to apply for an exemption under the consent exemption provisions if the tenant refuses, provided that the tenant’s refusal is properly documented and the landlord makes a genuine attempt to improve the property.
The exemption is valid for up to 5 years, but the landlord must still take reasonable steps to improve the property during that time.
What is meant by the assignee’s character. and what is the case law
- Character i.e., controversial or high risk industry. (betting shop, director with criminal history)
- Legal case example: International Drilling Fluids v Louisville Investments (1986) established that a landlord must act reasonably and not refuse consent for capricious or purely personal reasons.
What is meant by the effect on rental value with opposing an assignment. what is the case law?
- Effect on rental values. i.e., a Poundland store amongst high end stores. or if the assignee is noisy and produces an odor, other tenants will complain.
- case law: Ashworth Frazer Ltd v Gloucester City Council [2001]
The House of Lords held that a landlord may refuse consent to assign a lease if the proposed assignee’s intended use could damage the value of the reversion, e.g. if it would affect rental values or marketability of the landlord’s interest.
What is the RICS ethics decision tree
The RICS Ethics Decision Tree is a tool designed to help members assess whether their actions align with RICS professional standards and rules of conduct.
Breakdown the Ethics Tree. First Q and so on.
Is it legal?
/ \
No Yes
/ \
Don’t do it Is it in line with RICS standards?
/ \
No Yes
/ \
Don’t do it Would you be happy
for your actions to be public?
/ \
No Yes
/ \
Don’t do it Go ahead
Can you advise what CDM 2015 is.
- Construction design and management 2015 is a set of regulations designed to ensure health and safety throughout construction projects.
What are some requirements within cdm 2015
It requires key duty holders, like the client, designer, and principal contractor, to manage risks from the design stage through to construction. The main requirements include ensuring risk assessments are carried out, health and safety plans are in place, and that all parties collaborate to reduce potential hazards.
What are designers and principal contractors
Designers - manage H&S risks. Ensure the works eliminate risks or reduce them where possible. BUT main focus is on the planning and design stages.
Principal contractors - plan, manage, and monitor the construction phase of a project.
- designers create safe environment. principal contractors manage and enforce safety during construction.
What are the three types of asbestos and when were they banned.
White – 1999
Brown – 1985
Blue – 1985
What does an R&D survey do
A R&D survey, in the context of construction, involves identifying and managing Asbestos Containing Materials (ACMs) before refurbishment or demolition work begins. The survey locates and describes any ACMs in the building or area to be refurbished or demolished, ensuring that they are safely managed or removed according to health and safety regulations. This is critical for protecting workers and ensuring compliance with asbestos management laws.
What are the basis of apportionment for service charges?
Floor area, (objective, easy, doesn’t account for use)
rateable value, (reflects value, reviewed infrequently)
fixed percentage, (clear, predictable, not flexible)
Weighted (fair based on usage, more complex, can be disputed)
Who carries out rateable valuations
The Valuation Office Agency
How frequent are rateable values carried out
every 3 years
What was included in your section 25 notice?
Property, landlord, tenant
- term 10 years from July 2024
- rent £205,700 pa
- 5th year upward only to MR
- break option 5 year tenant only
- repair/dilpas to role over
- inside l&t act
- user - same
- other terms - same.
What advice would you give your client during a lease renewal if the property is overented?
I’d advise to do nothing, allow tenant to hold over and pay a higher rent.
How can a lease be renewed without a section 25 or 26 notice?
if L&T agree a new tenancy without formal notices. under section 28 of the act the existing lease ends and a new one begins.
What if S25 is due to expire and no new lease has been agreed?
Section 29B allows for either party to apply to court for an extension (before the deadline)
Tenant request for a new lease. how long does LL have to respond?
within 2 months or they lose right to oppose.
for a RR if the LL gets no response what are the options
RR usually not time barred unless there is time of the essence
LL can proceed but may need to go to arbitration or independent expert.
What is a section 27 notice
Where the tenant gives notice they are ending the lease. Needed with at least 3 months before expiry.
How long do you retain a valuation file
6 years
what are the tools of a negotiator?
Position of power
Knowledge
Charisma
Past experience
Clear communication
Why did you advise an AGA, what credit checks did you carry out?
- For extra protection due to the high rents on this unit, £200k a quarter.
- Weak economy, vacant units and estate nearby.
- Dunn and Bradstreet check
1A Low Risk
75 Credit Rating ‘good’ due to slight delays.
Why do you want to join the RICS
- Reputation
- Been working towards this since university
- Network
- Training
Differences between GEA and IPMS 1
- External balconies and accessible rooftop terrace are excluded in GEA but included and stated separately in IPMS 1
- Internal balconies included in GEA but stated separately in IPMS 1
Differences between GIA and IPMS 2
- Balconies and rooftop terrace same as IPMS 1
- IPMS measured to internal dominant face, therefore window reveals but GIA just measured to internal face.
NIA vs IPMS 3
- NIA excludes balconies and terraces. IPMS 3 includes but states separately
- NIA excludes areas under 1.5m height whereas IPMS states separately
- Internal walls and columns excluded in NIA but included in IPMS 3
- Enclosed walkways / passages excluded in NIA but included in IPMS 3
what is a Jervis v Harris clause
A clause in a lease allowing the landlord to serve notice on the tenant to remedy disrepair. If the tenant fails to act, the landlord can enter the property, carry out the works, and recover the costs as a debt, not damages.
This is significant because it avoids the Section 18(1) cap on damages and simplifies recovery. Established in Jervis v Harris [1996].
What is time of the essence
provisions set out specific periods or dates for the performance of contractual obligations, which are strictly enforced.
(e.g. linked to Ts option to break)
What is a deeming provision
These provisions are used to create certainty and clarity in situations where there might be ambiguity or dispute.
e.g.,
L to give notice to proposing a 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 Ls rent
L could be deemed to accept Ts counter proposal if lease states so.
How to contract out the 54 act.
Simple Declaration –
➤ Only if lease granted 7+ days after warning notice
➤ Signed by tenant before lease
Statutory Declaration –
➤ If lease granted less than 14 days after warning notice
➤ Sworn before solicitor
➤ Required under s.38A(3) LTA 1954
Difference between lease vs licence?
A lease is a legally binding contract that grants exclusive possession of land or property for a defined term whereas a licence does not. as defined in street vs mountford.
What leases are excluded from the 54 act?
Business premises, and the tenant must be in occupation for the purposes of their business.
Fixed term under 6 months, with no right of renewal
Tenancies at will
Licences (not leases)
Agricultural and mining leases
Difference between rent review vs lease renewal.
- A lease renewal is a statutory procedure laid down by the Landlord and Tenant Act 1954
- A rent review is a contractual procedure contained within the lease
UK Basis of value
Existing use value
Existing use value for social housing
What are some special assumption examples in valuation
– e.g. “Assume planning permission is granted”
Assume a different legal or physical situation
– e.g. “Assume vacant possession”
Assume a different date
– Retrospective or prospective valuation
Assumptions in valuation
Assumption something assume to be true without investigation i.e., property fit occupation, services connected, free from contamination. Special are taken to be true even though it’s not true, i.e. assuming vacant when let/let when vacant, assume planning permission.
RICS Simplified Arbitration Service (SAS)
What?
Used for?
Key points?
🟦 What?
New, streamlined arbitration service (2023)
🟦 Used for?
Mainly rural rent reviews / agri disputes
🟦 Key points:
Joint agreement needed
Fixed cost: £2,000 cap per party
Decision in ~28 days
Mostly paper-based, optional hearing
How would you value a retail property?
Since I am not currently a Chartered Valuer or a registered valuer, I would not accept new valuation instructions. I have only carried out internal valuations at my client’s request, ensuring they were for internal use only.
The second edition of RICS’ Countering Financial Crime: Bribery, Corruption, Money Laundering, Terrorist Financing, and Sanctions Violations standard is currently under consultation. expected to be published by August/September 2025. Updates?
🔹 Emerging Tech: Focus on AI and cryptocurrency risks
🔹 Enhanced Due Diligence: Risk-based approach for different levels of checks
🔹 Governance & Training: Senior officer for financial crime policies, staff training required
🔹 Sanctions Compliance: Addressing potential sanctions violations
🔹 Reporting: Mandatory reporting of suspicious activity while maintaining confidentiality
Please provide a high-level overview of the RICS Sustainability Report?
🔹 Market Demand: Increasing demand for green buildings, but adoption of sustainable practices remains limited
🔹 Barriers: High upfront costs and insufficient government incentives hinder widespread adoption
🔹 Sustainability Measurement: Need for consistent sustainability standards, e.g. RICS Whole Life Carbon Assessment (WLCA)
🔹 2050 Net-Zero Targets: Significant action required to meet targets
🔹 RICS Role: Shaping global sustainability policies and participating in initiatives like the UN Buildings Breakthrough
how is YP calculated
1/(1+i)^t
How is yp in perp calculated
1/i
What legislation is there for forfeiture
S146 of Law of Property Act 1925
Can the T apply for relief of forfeiture
Yes, under the leasehold property repairs act 1938 (for leases longer than 7 years with more than 3 years left to run.)
Surveying safely 4 step process to an inspection
Personal safety
Inspection of local area
External inspection
Internal inspection
Structure of surveying safely
Personal responsibilities
Assessing hazards and risk
Workplace h&s
Occupational health and hygiene
Visiting sites
Fire safety
Resi surveying
Management of contractors
Different between 1st and 2nd edition of surveying safely
2nd introduced
Safe person concept
Emphasis on competence of individual
What lights were replaced in the EPC improvement works?
T8 or T12 fluorescent tube lights replaced with LED lights.
What RICS publication is there on CHPs?
RICS Guidance Note (GN) on Complaints Handling Procedure (CHP).
Published in July 2016 as a guidance note.
It was later reissued as a Professional Standard in October 2023
This Professional Standard provides detailed guidance on how RICS-regulated firms should handle complaints, including the requirement to have a clear and accessible complaints procedure, maintain a complaints log, and include an Alternative Dispute Resolution (ADR) mechanism approved by the RICS Regulatory Board. (property redress scheme).
Red Book Update Effective 31st Jan 2025
Align with development in other relevant global standards and regulations, such as the new IVS
published on 31 January 2024. These included a revised structure and increased focus on ESG,
data and valuation modelling.
alignment with IVS as follows:
- VPS 1 (Terms of engagement)
- VPS 2 (Bases of value, assumptions and special assumptions)
- VPS 3 (Valuation approaches and methods)
- VPS 4 (Inspections, investigations and records)
- VPS 5 (Valuation models) (how you valued it)
- VPS 6 (Valuation reports)
Talk through your residual valuation?
Lastly, units 21-22 Botany Trading Estate.
GIA of 10,929
Office and amenity block to front of units, 2 toilets and kitchen space. 6 roller shutters.
The scope of works is for a roof replacement, PV installation, external and internal repair and concrete yard replacement.
Market rent of £165,000 from comparable evidence
I capitalised this into perpetuity at 5.5%.
This = GDV of 3 Million. Less of fees gives the net development value of 2.938 million.
To get the Gross residual value I subtracted all the necessary costs.
Main contact works 700k
Building fees at 10% of the contact works 70k
Finance at 8% 23k (interest rates around 5.25%
Contingency 5% 35k
Developers profit 15% of GDV 450k
Total cost 1.28 mill
GRV = 1.65M
PV for 6 months build time gives gross acquisition cost of 1.610 M
Less fees and stamp duty gives a site value of say 1.5M
