Business Plan Concept - Assignment

BUSINESS PLAN

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
The Property...........................................................................................................................1
Estimated Rental Value and All Risks Market Yield.............................................................3
Rateable Value of the building and Rates Payable including SBRR.....................................5
Hypothetical Scenario 1.........................................................................................................8
Hypothetical Scenario 2.........................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
.......................................................................................................................................................11

INTRODUCTION
Valuation of leasehold property is the complex concept and it will calculated through
critical financial ratios to measure the value of property (Ball, Lizieri and MacGregor, 2012). It
is direct for freehold property but in case of leasehold property, it more complicated to determine
because of their limited shelf life. It include typical tenure for the different leasehold property
such as 99 years for the residential or commercial property and 30 to 60 years for the industrial
property. This report cover various topics such as Estimated Rental Value (ERV) of the property
and it also include the All Risk Yield (ARY) which used for the valuation of risk related to
investment. In addition, Market Risk Yield (MRY) is the market risk of purchasing property.
MAIN BODY
The Property
Address: 85 Chester Street, Aston, Birmingham, B6 4AE
Rental Price: £ 121,478 per annum exclusive
Tenure: To Let (Leasehold)
Property Type: Industrial / Warehouse
Details: Approx. 8.1m eaves height
Accommodation: Near about 1736 sq m.
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Location: The prospective property is located on Chester Street within Aston area of
Birmingham. The property area can be used either as industrial, office, residential or
warehousing purposes. The property is highly accessible with interconnectivity between central
points of the city. It is roughly 1 mile away from Birmingham City as well as 2 miles away from
Junction 6 of M6 Motorway, that can be accessed via A38M Aston Express Way and A5127
Lichfield Road (Bellotti, 2017).
Description:
https://www.harrislamb.com/properties/85-chester-street-aston-birmingham/
 Infrastructure: The premises are a single bay industrial or warehousing unit made out of
steel portal frame with a pitched steel profile clad insulated roof. The roof contains
translucent roof lights, part block-part steel profile clad elevations as well as a concrete
floor that is beautifully painted. The eaves height of the building is about 8.1m with at
least 7m of working height. Floors: It comprises a integral two-storey design. The two floors are connected with two
staircases. The ground floor includes a reception area, trade counter and a combination of
open plan, cellular offices as well as work kitchen or canteen. Along with this, there are
water closet facilities available in the building for disabled, females as well as male
frequenters. On the first floor, a showroom is available in addition to a boardroom,
cellular offices, another kitchen and water closet facility. It also has an additional
mezzanine floor area with works office that enhances its storage capacity (Challinor and
et.al., 2014).
Floor Area Square Metre (sq m)
Building Area 1257.16
Ground Floor 247.03
First Floor 157.47
Mezzanine 74.6
Total Gross Internal Area (GIA)* 1736.26
*These measurements have been identified in accordance with RICS Code of Measuring
practice.
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