VALUATION METHODOLOGY

In assessing the market value of the freehold ‘going concern’ interest of the subject property we have had regard primarily to the capitalisation approach.

In this method market value is assessed by capitalising the estimated net operating profit from the property at an appropriate rate (yield) which reflects the risk of maintaining that income in perpetuity. The risk of maintaining the net operating profit is influenced by factors including but not limited to:-

·     Existing and future trading potential of the property

·     Location of the property

·     Age and condition of the improvements

·     Condition of plant and equipment

·     Existing and future competition

·     Management – our analysis assumes average management

·     Aesthetic appeal

·     Prevailing market conditions

·    Competition

In this instance an allowance has been added to the capitalised value to account for the additional land and improvements not forming an integral part of the going concern enterprise.