Nandadeep Valuers Foundation

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Case Studies-Land and Building

Author- Er Vimal Shah

Case Study-1

Mr. A is a freeholder of a 2 storied building (GF + FF). The rack is Rs 2 lacs per annum (net) for each floor. Mr. A has leased the GF to Mr. B on full repair lease before 20 Years for a period of 60 years at a rent of Rs 80000 per annum (net) by taking some premium and the FF to MR. C for 60 years on full repair lease before 25 years at a rent of Rs 60,000 per annum (net) by taking some premium. Assume rate of return as 8% and rate of recoupment as 3% for the tenants and the freeholder's return as 8%

1.1 Which method shall be adopted to find Marriage Value ?

1 point

COST APPROACH

MARKET APPROACH

IRR METHOD

INCOME APPROACH

Clear selection

1.2 What is the amount of outgoing for the landlord ?

1 point

NIL

8,000/-

6,000/-

6,400/-

Clear selection

1.3 What is the total annual rental income for the Landlord ?

1 point

2,00,000/-

80,000/-

1,40,000/-

60,000/-

Clear selection

1.4 What is the value of tenant B's interest in the property ?

1 point

7,82,000/-

12,90,000/-

14,50,000/-

19,36,000/-

Clear selection

1.5 What is the value of tenant C's interest in the property ?

1 point

14,50,000/-

7,82,000/-

19,36,000/-

12,90,000/-

Clear selection

1.6 What is the value of Landlord's interest in the property ?

1 point

7,82,000/-

19,36,000/-

14,50,000/-

12,90,000/-

Clear selection

1.7 What shall be the value of Landlord's interest in the property if it is vacant ?

1 point

50,00,000/-

30,00,000/-

40,00,000/-

14,00,000/-

Clear selection

1.8 What is the total Marriage value assessed in this case ?

1 point

5,24,000/-

NIL

1,08,000/-

3,24,000/-

Clear selection

1.9 If Mr. A wants to end the Lease of Mr. B, what amount he has to pay to Mr. B ?

1 point

14,50,000/-

12,90,000/-

15,58,000/-

13,98,000/-

Clear selection

1.10 If Mr. A wants to end the Lease of Mr. C, what amount he has to pay to Mr. C ?

1 point

14,50,000/-

15,58,000/-

13,98,000/-

12,90,000/-

Clear selection

Clear form

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