Briefing Paper

University of Manchester: SEED; Planning, Property and Environment 

Coursework Outline: PLAN60331 PROPERTY VALUATION 2023-24

Prepared by Ilir Nase

Property Valuation: Briefing for Assignment Two

There are two assignments for this course unit. For Assignment Two, students will prepare an individual essay.

Assignment Two is worth 75% of the final mark for the unit.

ASSIGNMENT 2

This is an individual critical essay which must be submitted through Turn-it-in on Blackboard by 2pm on Tuesday 23ª January 2024. The maximum word count is 3,000 words.

The property at 55 Princess Street Manchester, M2 4EW has been on the market for over a month. A snapshot of the key features extracted from one of the property platforms available to us and a brochure describing the available space to let are provided as part of this assignment package.

You are to prepare a valuation for your client, Bridgeford Street Enterprises Ltd. They wish to purchase the property as an investment with an intended holding period of 10 years and have instructed an assignment due (valuation) date of 16/11/2023.1 The valuation has been requested because they wish you to assess the property's investment value via a discounted cash flow (DCF) model taking account of all existing and future tenancies including (possible) lease renewals and/or new leases. The conclusions should additionally include advice to your client whether to accept the asking price.

NO PERSON OR ORGANISATION ASSOCIATED WITH THE ABOVE PROPERTY CAN BE CONTACTED FOR THE PURPOSE OF THIS ASSIGNMENT. ANY QUESTIONS SHOULD BE DIRECTED TO THE UNIT TUTOR (ilir.nase@manchester.ac.uk).

You are expected to build your own excel template for calculation purposes as no template will be provided for the DCF models. The subject property comprises of ground floor retail and office suites in the upper floors which requires analysis of market rents for both sectors. You need to do a market and tenant research to make informed decisions about lease renewals / new tenancies based on tenant covenants, (sub)market performance, etc. The 3d floor space figuring

1 For ease of template building consider the whole final year (2033) in your calculations, this will mean that the precise holding period will be for 121.5 months.

The difference between the instructed valuation date and Assignment 2 submission date is significant (over 2 months). There could even be a transaction during this time which you might as well consider for indicative purposes only. Your market evidence, particularly for comps, cannot be after valuation date i.e., you cannot consider transactions after 16/11/2023.