Transcript Document

Voluntary Action Camden
Open Book Presentation
The Proposal – Open Book Policy
• To sell land owned by Camden Local Authority to generate
funds to reinvest in Community Investment Programme.
• Funds will be used to rebuild the Edith Neville Primary School
and St Aloysius Nursery plus funds for the refurbishment of
the Ossulston Estate and Godwin & Crowndale Estate.
• There are other projects that may be allocated funds out of
this sale.
• By understanding how much the council might make from the
sale you can appreciate how much might realistically be
available for reinvestment in the Somers Town local
community.
Valuation of Development Land
There are two approaches to the valuation of development land:
comparison with the sale price of land for comparable development; or
assessment of the value of the scheme as completed and deduction of
the costs of development (including developer’s profit) to arrive at the
underlying land value. This is known as the residual method.
In practice it is likely that a valuation would utilise both approaches,
and the degree to which either, or both, are relevant depends upon the
nature of the development being considered, and the complexity of the
issues.
Valuation Information Paper 12 Valuation of development land
RICS (2008)
Residual Appraisal
Having established the development potential a
residual
valuation can be expressed as a simple
equation:
(value of completed development) – (development
costs + developers profit) = land value
Valuation Information Paper No. 12
Valuation of development
The Site
Residential sale prices
Retail/leisure comparable
Savills Research on development
viability of Private Rented Stock
Assumptions and main input variables
• Site area of 1,100 m2 or 0.27 acres
• Building footprint of 730 m2 or 7,860 sq ft
• One level of commercial space and 8 levels of residential
• 63 residential units (average 890 sq ft)
Income
• Residential sale price - £950
psf
• Affordable housing – 45% of
Market Value
• Retail rent - £25 psf pa.
• Retail yield – 7%
• Net to Gross of 90% used for
both retail and residential
Costs
• Site surveys - £500,000
• Build costs
• Retail - £160 psf
• Residential - £300 psf
• Marketing - £150,000
• Professional fees – 13%
Sensitivity on scheme with 15% of
units being affordable
Sensitivity on scheme with 30% of
units being affordable