Reversionary freehold valuations: over‐rented cash flows by spreadsheet

Nick French

Journal of Property Investment & Finance, 2013, vol. 31, issue 3, 298-306

Abstract: Purpose - The majority of investment property is valued at a point after the original letting or agreed market rent (MR) at review. This briefing aims to look at the valuation of “over‐rented” property. That is the term used to describe a property where the current rent passing exceeds the current market rent. Design/methodology/approach - This briefing looks at the valuation of over‐rented property by discounted cash flow and provides an example of setting up a flexible template by spreadsheet. Findings - The spreadsheet template allows the valuer to value the over‐rented cash flow by modified or full DCF. Practical implications - The flexibility of the template allows the user to change the length of the lease, the rent reviews and it calculates the term until the rent passing is exceeded by the estimated market rent. Originality/value - The technique is not original but the spreadsheet template helps to explain the profile of the cash flows derived from over‐rented properties.

Keywords: Freehold property; Reversionary freehold; Over‐rented; Discounted cash flow; Property; Rent reviews; Rental value (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:jpifpp:v:31:y:2013:i:3:p:298-306

DOI: 10.1108/14635781311322256

Access Statistics for this article

Journal of Property Investment & Finance is currently edited by Nick French

More articles in Journal of Property Investment & Finance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().