England and Wales Lands Tribunal

[2001] EWLands LRA_46_2000 (16 October 2001)

15 Cadogan Square (First Floor)

LRA/46/2000

LANDS TRIBUNAL ACT 1949

Leasehold Reform, Housing and Urban Development Act, 1993 Schedule 13 - Valuation of Leases disregarding rights - Evidence of settlements - Marginal variation from LVT's valuation - Appeal and cross-appeal dismissed.

IN THE MATTER of an APPEAL against a DECISION of the LEASEHOLD

VALUATION TRIBUNAL FOR THE LONDON RENT ASSESSMENT PANEL

BETWEEN ADRIAN J R LANGINGER Appellant

and

THE EARL OF CADOGAN AND Respondents

CADOGAN ESTATES LIMITED

Re: Flat 7 & Garage 6,

Clunie House,

Hans Place,

London SW1

Before: His Honour Judge Michael Rich QC

Sitting at 48/49 Chancery Lane, London WC2A 1JR

on 4, 5 and 8 October 2001

Edwin Johnson, instructed by Bircham Dyson Bell for the Appellant

Anthony Radevsky, instructed by Pemberton Greenish, solicitors of London for the Respondent


 


DECISION

Issues

1. This is an appeal against the decision of the Leasehold Valuation Tribunal (LVT) given on 14 August 2000 fixing the price payable in accordance with schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 for an extended lease of Flat 7 and Garage 6, Clunie House, Hans Place. They determined the premium at £144,435. The parties before this Tribunal dispute only two elements in the LVT's valuation. The tenant by its grounds of appeal disputes the valuation of the extended lease which the LVT had, after allowing an agreed sum for the value of the tenant's improvements, determined at £825,000 which equates to £767 psf for the agreed floor area of 1,076 sq ft. The parties are agreed that the vacant possession freehold value equals 101% of the extended lease value so that the equivalent freehold value used by the LVT of £833,250 (£774 psf) is accepted as following from its valuation of the extended leasehold.
2. Mr Justin Shingles, who gave valuation evidence on behalf of the tenant before this Tribunal, although not before the LVT, arrived at a freehold value of the subject premises in their existing condition of £745,000 from which he deducted the agreed £20,000 for tenant's improvements required to be disregarded, in order to arrive at a figure for the freehold of £725,000. From this he derives his valuation of the extended lease at £717,750. In reaching these figures he relied upon or considered a number of comparables and analysed the transactions in terms of rates psf. His figure for the freehold equates to £674 psf and for the extended lease to £667 psf.
3. The landlord has cross-appealed to dispute the LVT's valuation of the existing leases on two grounds. I record that the garage and flat are separately leased but cannot be disposed of separately and the extended lease is to be of both flat and garage. At the agreed valuation date of 8 June 2000 the leases had approximately 43 years unexpired to 24 June 2043. The LVT determined their value at £610,000 (£567 psf). They reached that figure after deducting the agreed £20,000 for the tenant's improvements from their valuation of the premises as they exist at £660,000, and also 5% for the value of statutory rights. The grounds of appeal challenge both the valuation and the adequacy of the deduction for statutory rights. The cross-appeal has been consolidated with the appeal, but the tenant, represented by Mr Edwin Johnson presented the tenant's case first.
4. The valuation issues are set out in the evidence of Mr Daniel Wiggin of W A Ellis who gave evidence on behalf of the landlord. He gave evidence of the value of the existing leases of the premises in their unimproved state in the sum of £550,000 (£511 psf) on the basis of a deduction of 7% for statutory rights. He also gave evidence as to the value of the extended lease of the premises in the same condition in the sum of £825,000, thus supporting the LVT's valuation. In both cases his evidence was as to his opinion of the relevant capital value which he then supported by reference to comparables. He did not proceed from an analysis of rates psf.
5. Mr Shingles for his part did not proffer a separate valuation of the existing lease, but after considering the comparables relied upon before the LVT, he gave his opinion that the LVT's valuation of the existing leases was not wrong.
6. Thus in tabular form the dispute for the determination of the Tribunal may be summarised as follows:

Tenant	Landlord	Landlord
Extended lease	£717,750 (£667 psf)	£825,000 (£767 psf)
Freehold interest (+ 1%)	£725,000 (£674 psf)	£833,000 (£774 psf)
Existing lease	£610,000 (£567 psf)	£550,000 (£511 psf)

(The LVT's figures are in bold. The agreed deduction of £20,000 for the tenant's improvements has been made.) Having regard to the parties' agreement as to other matters, the price to be paid in accordance with the statute would be a simple matter of calculation from the determination of these disputed figures.

Evidence before the Tribunal

7. Before discussing the evidence of the two witnesses, to whom I have already referred, I should refer briefly to that of two other witnesses. Firstly to that of tenant himself who in addition to relying upon Mr Shingles's expert evidence, gave his own evidence, which, in so far as it was not mere opinion evidence which he was not qualified to give, I admitted. He made certain criticisms of the condition of Clunie House. The minor factors to which he drew attention are however merely a part of the process of assessing the relevance of comparable transactions of other premises with their respective advantages and disadvantages. Mr Shingles noted his understanding of the condition of each comparable in describing it for the purposes of his analyses. Mr Langinger also referred to advice which he had received as to weekly letting values but neither of the valuers nor I count this of assistance. Mr Langinger's evidence was primarily directed to the inconvenience of the garage which is part of the premises. It is only 7ft 8½ins wide, that is less than the 8 ft recommended by the planning authorities for parking spaces. As Mr Wiggin had placed particular emphasis on the availability of a garage in his selection of comparables, I took care to note the size of garages and parking spaces when I inspected the comparables. The garages at Marland House, to whose availability to let Mr Langinger had drawn attention, were only 7ft 5ins wide. The car parking spaces at Bolebec House, to which Mr Wiggin referred, were also 7ft 8½ins wide, but those at Belgravia House were 10ft. There are obvious advantages of security in a lock-up garage, but a parking space of similar dimensions may offer better accessibility. When properties which I have regarded as comparable, have included garages, they have been no better than that at the subject premises, and where it has been material to adjust to allow for the availability of the garage I have been content to adopt Mr Shingles's valuation of £60,000 as a freehold value of the garage at the subject premises.
8. Mr Radevsky, who appeared for the landlord, called Mr Julian Clark BSc, MRICS of Gerald Eve, to give expert evidence. Although he was the only professionally qualified witness and, as such produced a formal valuation based on Mr Wiggin's figures, he himself made no valuation. He produced factual evidence of settlements achieved in respect of the grant of extended leases on the Grosvenor Belgravia and Cadogan Estates. These enabled him to analyse the relativity of the valuation of various lengths of lease, on the assumption that the lessee had no statutory rights, to the value of the freehold. Of the nature of the real world where there are no transactions in which statutory rights are not attached to the interest assigned, there can be no comparable evidence of values disregarding such rights. Mr Clark had produced these same tables before the Tribunal in a case concerning Flat B 23, Cadogan Square which was heard by Mr N J Rose FRICS. In his decision dated 12 February 2001, Mr Rose accepted that such settlement evidence could provide valuable evidence to cross check valuations arrived at on the basis of comparable evidence and would be the best evidence where no comparables were available. However, he expressed himself as being far from satisfied in that case that the analyses of settlements provided by Mr Clark provided an accurate indication of valuations in fact agreed. Before me, Mr Clark has produced more evidence of agreements, but, as he accepted, agreement as to relativity was in fact reached in less than half of the cases on which he particularly relied. Nevertheless agreements were reached in each case as to the premiums to be paid. If the valuers representing the tenants did not agree the values of the existing leases and of the freehold, it must be because they took the view that the former was greater or the latter less than was claimed on behalf of the landlord, or both. Any disagreement as to relativity would therefore be to the effect that the landlord had under-estimated the proportion of freehold value attributable to the existing lease. Further since these landlords would not agree settlements outside the pattern of relativities set by previous settlements, the pattern was likely to be self-reinforcing.
9. Mr Shingles produced evidence of two transactions in Cadogan Square, the sale of a 21¾ year lease at 2/45 and of an extended lease of 23B, to show that Mr Clark's table of settlements was not reproduced in market transactions. After adjustments he calculated a relativity of 77.97% compared with a range of values from Mr Clarke's table of settlements barely exceeding 50%. Unfortunately, I did not find Mr Shingles's calculation persuasive. The purchase of 23B was not an open market transaction, the discount to be made for rights on 2/45 begs the very question which it is sought to answer, and the need for adjustment to allow for the different positions of these differently sized flats made his exercise too speculative to enable the Tribunal to draw further conclusions than those that follow from the identification that I have already made of the reasons why the table will tend to underestimate relativities.
10. Providing therefore that these factors tending to mean that the tables are likely to under-estimate relativities are kept in mind, I think that they can be used, as Mr Radevsky submits, as checks on valuations as to which there is comparable evidence and as to opinions where there is no comparable evidence. I shall revert to Mr Clarke's evidence for that purpose after I have addressed the evidence of comparable transactions upon which Messrs Shingles and Wiggin based their opinion of value.

Valuation of Freehold

11. Mr Shingles produced a schedule of twelve comparables to which he referred in support of his valuation of the freehold. He had in each case adjusted the prices paid by reference to time in accordance with the FPD Savills residential capital values index for Prime Central London Flats. Such adjustment was agreed by Mr Wiggin. He had then assessed a rate per square foot for each property, which was in each case a matter of arithmetic. Where necessary he then adjusted to an equivalent freehold value. He did not however in doing so apply any table of adjustment and where it was questioned, his opinion appeared to be arbitrary, although in the event disagreements became fairly unimportant in the assessment of the freehold value because of the sufficiency of transactions which were sufficiently close to freehold transactions for agreement to be reached as to the appropriate adjustment.
12. Mr Shingles then purported to adjust the rates psf so derived from comparable transactions to the different circumstances of the subject premises. If his further adjustments had been appropriate and sufficient, the resulting figures would have formed a pattern such that the market value of the subject premises would have been shown within a narrow band varying only according to the vagaries of the market. His resultant figures however ranged from £516 psf to £877 psf. I fear that I therefore found this methodology wholly unhelpful. It indicated either that his adjusted starting rate psf was unreliable or that his adjustments for identified differences were insufficient or both, probably because he had sought to adjust comparables which were not truly capable of being used as comparables at all.
13. For these reasons, I asked Mr Shingles to prepare a schedule of the comparable transactions relied upon adjusted only for time (as agreed), to which were added columns for an adjustment to freehold value and rate psf. In the case of seven out of the twelve transactions the valuers could agree the adjusted rate psf for the freehold. In the other cases, I was given alternative rates according to the respective views of relativity of Mr Wiggin and Mr Shingles. I append the schedule so produced as Appendix 1 to this Decision. I have with the assistance of the schedule so prepared been able to review the evidence both of Mr Shingles and of Mr Wiggin.
14. To assist my review I have inspected the subject property and an equivalent unimproved flat in Clunie House both inside and out. I have inspected the exterior of all but one of the comparables and in each case I have inspected the common parts and parking facilities if any. The exception, 41 Royal Court House is significantly larger than the subject premises and has a roof terrace, and was not seriously relied on by either valuer. I begin by reciting the agreed facts as to the subject premises as found in an agreed statement of facts.

Description of the Surroundings

15. 1 Hans Place is an oval shaped terrace of mainly Victorian or Edwardian houses built around a central garden. Part of the east side of the garden square is made up of two 1960's apartment blocks one being the subject building and the other being Denbigh House. Hans Place is a much sought after and prime residential location in central London within easy walking distance of the restaurant and shopping facilities of Knightsbridge and Brompton Road to the north and west and Sloane Street to the east. There is a London Transport Underground station at Knightsbridge and bus routes in Knightsbridge, Brompton Road and Sloane Street. As well as residents on street parking, there is an NCP car park in Pavilion Road.
16. 2 The subject building is not listed, but is situated in the Hans Town Conservation Area.

Description of the Building

17. 1 Clunie House is a purpose built block of apartments and garages built in the early 1960's and situated on a substantial plot between the east side of Hans Place and Pavilion Road to the rear. There are two flats on each of the ground to fourth floors with a penthouse flat occupying the whole of the fifth floor. There is a caretaker's flat in the basement, together with 2 garages and a number of storerooms let with the underleases of the flats. 12 further garages (6 at ground floor and 6 at lower ground floor level) and a first floor mews flat comprise a separate 3 storey block to the rear fronting Pavilion Road. The main pedestrian access to Clunie House is via the foyer fronting Hans Place. Vehicular access is from Pavilion Road via a ramp, which leads down to the basement level garages below the main block and the mews block. …
18. 2 The flats in the main building therefore have outlooks, both eastwards over Pavilion Road and westward over Hans Place. All floors in the main building are served by a lift and there is a resident caretaker. In addition to the provision of garages, there is local residents' on street parking in the immediate vicinity.

Description of the Subject Flat

19. 1 Flat 7 is situated on the second floor of Clunie House, taking up the northern half of that floor. Garage 6 is situated in the mews block on the ground floor at the north end and thus opens out directly into Pavilion Road. The storeroom let with the flat is situated in the basement of the main block.

5.2 The accommodation in the flat comprises:

Description	Metres	Feet
Hallway
Living Room (west facing with balcony)	4.93 x 4.41	16' 2" x 14' 6"
Bedroom 1 (west facing)	4.77 x 3.76	15' 7" x 12' 4"
Bathroom 1 (en suite to Bedroom 1)	3.08 x 2.09	10' 1" x 6' 10"
Bathroom 2 (no natural light)	1.81 x 2.09	5' 11" x 6' 10"
Cloakroom/wc	0.89 x 1.69	2' 11" x 5' 6"
Bedroom 2 (east facing)	3.48 X 3.15	11' 5" X 10' 4"
Dining Room/Bedroom 3 (east facing)	3.48 X 2.71	11' 5" X 8' 11"
Kitchen (east facing)	2.76 x 2.93	9' 0" X 9' 7"

20. 3 The gross internal floor area is approximately 99.94 square metres (1,076 square feet).
21. 4 Access to the flat is by way of communal stairs or lift opening onto the second floor landing.
22. 5 There is a gas supply to the flat. There are two built-in electric heaters, as landlord's fixtures, one located in the hallway and one in the second bedroom. Hot water within the flat is independently electrically heated, with an immersion heater and hot water tank serving the two bathrooms and an instant water heater serving the kitchen."
23. Clearly the best evidence of value, if available, would be a similar flat in the same block. Before the LVT evidence was given as to the various offers made in respect of three flats in the block and even in respect of the subject premises, but because none fructified into a transaction and there may be special circumstances attaching to each, neither party relied on any of these offers, and I put anything I was told about them out of my mind.
24. Mr Shingles placed reliance on the sale of the penthouse flat, 12 Clunie House in October 1999 at an adjusted price psf of £871. Mr Wiggin regarded a flat, recently modernised and occupying with its terrace of 383 sq ft more than twice the floor space of the subject premises and commanding views from the 5^th floor, as simply not comparable. I do however think that it is of some assistance because it is, after all, in the same block, has a similar garage and storage cage, and enjoys the same location. For the purposes of analysis I calculated a rate psf treating the terrace, which is clearly a significant amenity, as half value, and note a figure of £779 psf which would be so derived.
25. Mr Shingles has referred to a group of blocks of similar age and not dissimilar appearance in Upper Belgravia: Whaddon, Thorburn and Greville Houses. The flat in Whaddon House has no garage but there is parking in a private road. Those in Thorburn and Greville Houses do have access to a NCP car park where they can rent space at a 90% discount. But this car park dominates the access to these blocks and there is no dispute that the surroundings' ambience is markedly inferior to that of Hans Place. I have already said that I would accept Mr Shingles's valuation of the subject garage at £60,000 and regard that as the appropriate adjustment to equivalence with the subject premises even though as at present these flats do enjoy some parking facility. I note that the adjusted rate psf for 24 Greville House including the garage on this basis would be £647. I regard this as a poor comparable by reason of its location but accept that it is right to have regard to it. I do not however think it necessary further to analyse 17 Thorburn House whose condition was said to be "tired" when sold and where the sale was of a 63 year lease whose adjustment to freehold value is in dispute. Likewise 16 Whaddon House is in an even less well favoured location but I note that it equates on the same basis to £522 psf.
26. I turn next to put to one side two transactions to which Mr Wiggin referred at the Bromptons in South Kensington. This is well removed in terms of both location, amenity and style. I do not find these to be useful comparables.
27. Rather closer, but hardly more useful is a transaction in respect of 39 South Lodge, a much more spacious flat in a more modern block with "stupendous views", which is agreed to show an adjusted value of £820 psf.
28. Rather closer both geographically and in quality was a group of transactions around Lowndes Square. 12, Bolebec House is very similar in size. Although it lacks an ensuite bathroom I do not regard its layout as significantly inferior. The common parts of this building are impressive when compared to the subject premises. For the purposes of analysis I accept Mr Shingles's adjustment of the rate psf to reflect the vendor's contribution to improvements being carried out at the time of the sale, and would therefore note a rate psf of £766 for the freehold. I noted on inspection that the flat is on the third floor above Barclays Bank, although on the 2^nd floor of the block. The outlook is not so good as that of the subject flat, but it is probably not too much affected by the traffic in the busier roads, and is, in my judgment a useful comparable.
29. Two comparables in Lowndes Court both overlooking the Lowndes hotel in the front and parking access at the rear, demonstrate the value of the higher floor. I accept Mr Wiggins analysis of these in preference to that of Mr Shingles, as being based on a more carefully and coherently based table of adjustments for length of term. No.2 on a raised ground floor at £686 psf is 84.5% of the £811 psf for No.22 on the 2^nd floor. They both are in a clearly superior block with better common parts than Clunie House, but whilst being allowed access to Lowdnes Square Gardens they lack the views over a garden which is an important amenity for the subject premises.
30. Mr Shingles also referred me to a very recent transaction at 18 Chelsea House which Mr Wiggin would analyse at £579 psf. Although occupying a smaller area within a curved building it is divided into more rooms. I have not been able to inspect internally, but my visit to the common parts leads me to accept Mr Wiggin's view that this is a "Division 2" block, not readily comparable with the subject premises.
31. I return therefore to the guidance to be derived from those comparables which I have noted as being of assistance. Mr Wiggin said in cross-examination that he preferred the subject premises to 12 Bolebec. I agree with him as to the view but less as to the lay-out. He himself valued the subject property at £774 psf a little less than his analysis of this comparable, which after adjustment to £766 now appears to be somewhat less than his valuation of the subject premises unimproved. In spite of the similarity of buildings, I regard the subject property as much closer to Lowndes Court in quality than it was to Greville House. I have no doubt that 12 Clunie House is more valuable psf as well as overall but regard it, as I have analysed it, as a useful check on my valuation of the freehold which I make at £750 psf or £807,000 for 1076 sq ft. Concentrating, as Mr Wiggin has on capital values, that would be more than the more compact 12, Bolebec House, and a little over half the price of the improved pent house. Having regard to the agreed adjustment of 1% the valuation of the extended lease would be £799,099, I therefore conclude that the LVT has arrived at a figure for the freehold a little more than 3% above that at which, with the benefit of further evidence I would have arrived.

Valuation of existing lease

32. There is far less comparable evidence available for the valuation of the existing leases. After considering a number of transactions including a four year old transaction at 6 Clunie House which both valuers rejected as too historic, Mr Wiggin confined himself to reliance on a sale of a lease with 33.75 years unexpired at 2 Belgravia House and of a lease with 57.38 years unexpired at 4 Denbigh House. I append as Annex 2 Mr Shingles' summary of facts in respect of these two properties to which have been added the rival adjustments to value the subject lease of 43 years. The first of those properties however is on the ground floor facing the street in Halkin Place. It is significantly larger with an extra room. I did not, after hearing evidence in regard to it and inspecting it externally, find it a useful comparable.
33. Denbigh House on the other hand is an almost identical block next door in Hans Place. It has effectively the same garage and storage provision. It is however less well related to the buildings at the rear and No.4 on the 1^st floor would look into buildings, over which the rear of the subject premises would have an uninterrupted view. It is agreed, that the subject premises are in what the market perceives as the preferred block. They are also higher, have a better layout and in my judgment clearly ought to be worth more, not only overall but even psf. The only factor which would tend to increase the rate psf for 4 Denbigh House is its smaller floor area of 800 sq ft against the subject flat's 1076. Within that space, it succeeds in providing, as does the subject flat, 2 bedrooms, a kitchen and a living room. It however has only a shower room, instead of two bathrooms. Mr Wiggin accepts that this may have the effect of reducing the possible market to those looking for a pied-à-terre, whereas the subject property could attract purchasers looking for a main home. I therefore conclude that even after allowing a discount for size, the existing lease of the subject property, even in its unimproved state, would have a higher value psf for a similar unexpired term than 4 Denbigh House. I would, having regard to the evidence of the effect of floor levels at Lowndes Court, regard a net adjustment to the rate psf of the order of 10% as appropriate.
34. This however is the order of adjustment to be made to a rate psf for 4 Denbigh House if the lease which was sold had been of the same unexpired term as the subject premises and the transaction had not been affected by the availability of 1993 Act rights. The problem in using the evidence of this transaction in order to arrive at a valuation of the existing leases of the subject premises is to decide on the appropriate adjustments to reflect firstly the different unexpired terms and secondly the need to disregard the effect on value of statutory rights.
35. Mr Wiggin uses a table, whose reliability he could explain only by reference to the authority of his senior partner, to adjust the rate psf derived from the sale of 4 Denbigh House to the valuation of the subject 43 year lease. The multiplier derives from the respective relativities of the 43 year and the 57 year leases, to freehold value. He multiplied by 66.1 and divided by 75.2, to produce an adjusted rate psf some 88% of the £586 agreed to be derived from the actual transaction. These relativities are said to have been derived from "transactions uncorrupted by actual or potential rights". How this could be achieved I have not been informed, but I am even less assisted by Mr Shingles's alternative multiplier of 75 ÷ 82 or 91%.
36. The fallacy of using the relativities of leasehold values "uncorrupted by rights" to derive a figure from a transaction which Mr Wiggin says "must have included some element attributable to potential 1993 Act rights", and then adjusting the figure to allow for the disregard of such rights in respect of the shorter tenancy, is, of course, that it assumes, almost certainly wrongly, that the rights form the same proportion of the value of the longer as of the shorter lease.
37. Mr Wiggin however merely treats the figure of £515 psf for a 43 year lease of 4 Denbigh House as supporting his judgment figure of £511 psf for the subject premises disregarding rights. If rights represent, as he suggests, 7% of market value, this indicates a valuation of the subject leases without rights at £549 psf.
38. I checked the consistency of Mr Wiggin's valuations, which I am satisfied he arrived at independently, by noting that his figure for the existing lease, excluding rights, is almost exactly 66.1% of his valuation of the freehold. If I accepted his relativities, I ought, if I value the freehold less, certainly not reject his valuation of the existing lease. Mr Clark purported to do a similar check against his own tables and regarded the fact that a relativity of 66% fell within the band of settlements for 43 years leases from 65.5% to 72.9% as supporting Mr Wiggin's valuations. If, however, as I have found, the table of settlements tends to under-estimate relativities, the fact that Mr Wiggin's figures are at the bottom of Mr Clark's range, is cause to doubt them.
39. To use the evidence of 4 Denbigh House in order to arrive at a without rights valuation of the subject leases, it would, of course, be the discount for the 57 year lease, which Mr Shingles suggests is very nearly nil which matters. Mr Shingles suggested as a rule of thumb that an allowance of 2½% might be appropriate for leases of between 50 and 60 years. If that were applied to Mr Wiggin's adjustment for length of time, one would get a without rights figure for the 43 year term at 4 Denbigh House of £502 psf. That seems to me to justify a valuation on the same basis for the existing leases of the subject premises of £550 psf or £591,800, say £592,000. This is less than 3% less than the figure at which the LVT arrived.

Conclusion

40. Applying the figures at which I have arrived to the LVT's valuation would have the effect shown on Annex 3, namely of reducing the price payable by less than £4,000 and less than 3%. It is quite impossible for me to say on such figures that the decision of the LVT was wrong and I would dismiss both appeal and cross-appeal.
41. As agreed at the hearing I will consider any application as to costs made within 14 days of the date of this decision.

Dated: 16 October 2001

(Signed) HH Judge Michael Rich QC


 


ANNEX 1

7 Clunie House

Freehold Comparables

Freehold Comparables unimproved

		Index	Time	Adjust to freehold	£ rate psf of GIA
Flat	Penthouse 12 Clunie House	237.20	£1,560,540	£1,576,303	£871
Date	Oct 99
Price	£1,400,000
GIA sqft	1810
Lease	118
Floor	5
Aspect	E/W
Condition	Excellent
Lift	Yes
Balcony	Terrace 383 sqft
Flat	16 Whaddon House William Mews	255.06	£609,014	£609,014	£476
Date	Feb 00
Price	£587,500
GIA sqft	1280
Lease	sof
Floor	5
Aspect	E/W
Condition	Fair
Lift	Yes
Balcony	Yes
Flat	17 Thorburn House	255.06	£373,183	Shingles £444,265 Wiggin £466,650	£486 £510
Date	Feb 00
Price	£360,000
GIA sqft	915
Lease	63
Floor	5
Aspect	NW/SW
Condition	Tired
Lift	Yes
Balcony	No


 


ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)
7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables
Flat	24 Greville House	280.9	£698,879	£705,938	£596
Date	Jan 01
Price	£710,000
GIA sqft	1184
Lease	125
Floor	7
Aspect	NE
Condition	Fair
Lift	Yes
Balcony	No
Flat	12 Bolebec House	212.37	£796,811	£796,811	£777
Date	Jul 98
Price	£640,000
GIA sqft	1026
Lease	985
Floor	2
Aspect	N/S
Condition	Fair
Lift	Yes
Balcony	Yes
Flat	2 Lowndes Court	264.40	£810,000	Shingles £843,750 Wiggin £879,967	£664 £686
Date	Aug 00
Price	£810,000
GIA sqft	1270
Lease	85.75
Floor	Raised G
Aspect	E
Condition	Good quality
Lift	Yes
Balcony	No


 


ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)
7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables
Flat	22 Lowndes Court	211.67	£905,622	Shingles £938,468 Wiggin £965,282	£790 £811
Date	Feb 99
Price	£725,000
GIA sqft	1188
Lease	87
Floor	2
Aspect	E
Condition	Good quality
Lift	Yes
Balcony	No
Flat	41 Royal Court House	244.00	£958,992	Shingles £988,651 Wiggin	£612 £625
Date	Dec 99
Price	£885,000
GIA sqft	1615
Lease	90
Floor	4
Aspect	N/W/S
Condition	Immaculately presented
Lift	yes
Balcony	Roof terrace: 159 sq ft
Flat	39 South Lodge	212.30	£1,071,050	£1,071,050	£820
Date	Sep 98
Price	£860,000
GIA sqft	1306
Lease	sof
Floor	9
Aspect	N & S
Condition	Good
Lift	Yes
Balcony	Yes


 


ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)	ANNEX 1 (Continued)
7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables	7 Clunie House Freehold Comparables
Flat	42 The Bromptons	244.00	£1,046,764	£1,046,764	£818
Date	Frv 99
Price	£966,000
GIA sqft	1280
Lease	sof
Floor	1st & 2nd
Aspect	NE & NW
Condition	Excellent
Lift	Yes
Balcony	Yes + roof terrace
Flat	45 The Bromptons	249.53	£842,364	£842,364	£877
Date	Jan 00
Price	£795,000
GIA sqft	960
Lease	sof
Floor	2
Aspect	N & S
Condition	Good
Lift	Yes
Balcony	Terrace: 72 sq ft
Flat	18 Chelsea House	299.90	£520,160	Shingles £571,604 Wiggin £584,449	£566 £579
Date	May 01
Price	£590,000
GIA sqft	1010
Lease	76.83
Floor	9
Aspect	E & W
Condition	Bright
Lift	Yes
Balcony	No


 


ANNEX 2

7 Clunie House

Leasehold Comparables

Flat	7 Clunie House
Date	Jun 00
GIA sqft	1976
Floor	2
FPD Savills Pcl Flats Index June 2000	264/4
Length of Lease	43
Lift	Yes
Balcony	Yes

Leasehold Comparables unimporved

		Index	Time	£ rate psf of GIA of comparable	After Adjustment
Flat	2 Belgravia House, Halkin Place	237.20	£479,309	£365	Shingles £386 Wiggin £416
Date	Oct 99
Price	£430,000
GIA sqft	1312
Lease	33.75
Floor	G
Aspect	NE
Condition	Well maintained
Lift	Yes
Balcony	No

Flat	4 Denbigh House Hans Place	211.6	£468,573	£586	Shingles £536 Wiggin £515
Date	Feb 99
Price	£375,000
GIA sqft	800
Lease	57.38
Floor	1
Aspect	W
Condition	Fair
Lift	Yes
Balcony	No


 


ANNEX 3

Flat 7 and Garage No.6

Clunie House, 4-7 Hans Place, London SW1

Determination of the premium to be paid in accordance with s.56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993, as at 8 June 2000 - the agreed valuation date.

A. Diminution in value of the landlord's freehold interest (para 3)	A. Diminution in value of the landlord's freehold interest (para 3)	A. Diminution in value of the landlord's freehold interest (para 3)	A. Diminution in value of the landlord's freehold interest (para 3)	A. Diminution in value of the landlord's freehold interest (para 3)
			LVT's figures	LT's figures
(i)	Value under existing lease -
	Ground Rents 8/6/2007 YP 7 yrs @ 7%	£255 pa 5.3893	£1,374
	Ground Rents 24/5/2007 to 23/6/2028 YP 21 yrs @ 7%	£510 pa 10.8355 £5526
	Deferred 7 yrs @ 7%	0.6227497	£1,397
	Ground Rents 24/6/2028 to 23/6/2043	£1020 pa 9.1079 £9290
	Deferred 28 yrs @ 7%	0.1504022	£1,397
	Reversion to freehold with vacant possession disregarding tenant's improvements £833,250 Deferred 43 yrs @ 6% 0.0816296		£68,017 £74,229	74,229
	Less
(ii)	Value under extended lease -
	Grounds Rents	£nil
	Reversion to freehold with vacant possession disregarding tenant's improvements £833,250 Deferred 133 yrs @ 6% 0.00043	£358	£807,000 £358 x 0.00043 £73,871	347 73,882


 


ANNEX 3

(Continued)

Flat 7 and Garage No.6

Clunie House, 4-7 Hans Place, London SW1

			LVT's figures	LT's figures
B	Marriage Value (para 4)
(i)	Values under the extended lease -
	Freehold interest Leasehold interest	£358 £825,000 £825,358	799,099	£799,347 £799,446
	Less
(ii)	Values under the existing lease -
	Freehold interest  £74,229 Leasehold interest £610,000	£684,229		£74,229 592,000 666,229
	Marriage value 50% of Marriage value	£141,129 £ 70,564		133,217 66,608
C	Premium for extension of lease
	Diminution in value of freehold interest Share of Marriage value Compensation under Sched.13 para 5	£73,871 £70,564 £nil		£ 73,882 £ 66,608      nil
	Premium	£144.435		£140,490