1. Acting as a Consultant to the Client and taking back Control over Fees Two Sides of the Same Ticket to Successful Valuation Practice
Roger G. Messenger BSc FRICS FIRRV MCIArb REV Hon. CAAV
MIPAV (Hons) RICS Registered Valuer
Vice Chairman, TEGoVA
Chairman of REV Recognition Committee
Wilks Head & Eve

2. Why – What is the Problem?
Short Reports, Single Valuation, No Advice
= Very Low Fees
- Common Complaint is – “Fees are Unsustainable for Valuers”

3. Instructions from Clients
BANKS – Usually very detailed and specific – may be limited room to “expand” the instruction –
BUT: - All Banks have customers, and it is usually for a Borrower customer that a valuation is being compiled. In the United Kingdom, the Valuer would be copying the valuation to the customer!

4. Valuation Instruction – Other than Bank
- Expand and Grow the Fees!
- Most of the time, the Client will welcome the advice for a relatively small additional cost
ACTUAL EXAMPLE from 2014 – and ONGOING! Instructions from a Client to value an investment property for the Bank who hold a mortgage on it.

5. - Access – Good vehicle and pedestrian access
PROPERTY – CAR PARK – CRAWLEY – SOUTH EAST ENGLAND Instruction: Value Freehold Interest subject to the Lease
- Location - close to main shopping centre – open- air surfaced car park
- Access – Good vehicle and pedestrian access
- Size – 34 car parking spaces – 0.06 hectares
- Surface Condition - Fair

6. CAR PARK VALUE
- Based on Receipts to car park/rental profile TARIFF: £2.30 / 1 hour £3.30 / 2 hours £5.30 / 24 hours

13. Lease to a National Firm of Car Park Operators
- 5 Years – 9/11 to 9/16
- Permitted Use – Vehicle Parking
- Rent: £53,000 per annum
- New Lease possible

14. Let to a Good Covenant
- Valuation Date August 2014 – 2 years’ £53,000
- Reversion to ? £60,000 based on a receipts profile
- £885,000 = Capital Value

15. - FEE FOR ADVICE, FEE FOR NEGOTIATION
ALL DONE?
- NO 1. Re-gear existing lease now New 15 year lease with 5 years remaining Even at £53,000 per annum, value would increase to £1,050, Tenant would agree a new lease.
- FEE FOR ADVICE, FEE FOR NEGOTIATION

16. ALL DONE? 1. What else can I do with this?
- NO
1. What else can I do with this?
- On its own, too small and in the middle of other buildings
- Can it be combined with neighbours?
- Yes, possibly.
- FEE TO INVESTIGATE, ADVISE AND TAKE FURTHER

17. Maybe Should Have Looked at This as Part of the Valuation Instruction?
So adjacent – tired old Church Hall – 2 storey
- Approach Diocese who ‘own’ church property
- Discuss – would they like a ‘state of the art’ new church hall?

18. Approach Local Authorities for Risks on obtaining Planning Permission
- Long Discussions – but eventually included in their regeneration vision.
- What for? Church Hall, Community Centre and 42 apartments.
- ADVICE ON FINANCIAL FEASIBILITY – VALUATIONS – VALUE TO CHURCH AUTHORITY
- ADVICE ON JOINT VENTURE
- FEES

20. LOCAL AUTHORITY OWN ADJACENT LAND
- Can we be part of a bigger scheme?
- Car Park/Church Hall/Local Authority land
- MAYBE – with the right deal
- ADVICE, VALUATIONS, NEGOTIATION
- FEES

21. JOINT VENTURE PROJECT
- Cost and value apportionment between 3 parties
- Planning Consent – Planning Obligations – cost?
- Development Contractor Procurement
- Funding Procurement
- ADVICE, VALUATIONS, NEGOTIATION
- FEES

22. LOCAL AUTHORITY FALL OUT OF J.V.
- NOW TWO PARTIES
- Revaluation and negotiation
- Advice and FEES

23. - Worked up Scheme Drawings
IN THE MEANTIME
- Worked up Scheme Drawings
New Lease – with Landlord Redevelopment break option
- Advice, Valuation and FEES

24. CLIENT - Asset now worth £1,100,000 (£885,000) “as is”
- Potentially £1,600,000 as the JV development site
- Initial Valuation Fee for Bank – now plus 1,000%
- Still good value for the Client

25. PLANNING
Revised scheme for apartments and church hall rejected by Planning Authority
“Insensitive to historic church”. Over-development.
New scheme drawn up – new viability valuations – fees
In the meantime – church issues!
NEW VICAR
Completely different ideas. Doesn’t want a church hall, but a multi-use ground floor space so he can run a retail outlet/drop-in centre and café in the daytime and refuge by night. He also wants two flats – free.
VALUATIONS
- Revised valuations between the parties and revised viability valuations on new planning scheme - FEES

26. DEVELOPER PROBLEMS ADMINISTRATORS
A falling-out between Directors of development company client. One Director forces administration – Two accountants appointed as administrators.
ADMINISTRATORS
Accountants approach us as having best knowledge of the site and all the issues. Valuation in administration pending a sale – FEES
Advice on achieving a planning consent to add value – FEES
Consultant to Architects who are doing a new scheme – FEES
Negotiation with Church (Vicar) and Diocese on the value of constituent parts with and without planning consent - FEES

27. PLANNING AND POST-PLANNING
On receipt of a planning consent, Administrators will commission a sale of the investment rather than any redevelopment. For potential conflict reasons, we will not handle the sale, however, the Administrators have outlined that once on the market, we are free to represent any potential developer purchaser in an acquisition. In the alternative, the Diocese may instruct us to advise them on any disposal agreed with a developer.
FEES – an instruction that keeps giving!
FUTURE
Given the nature of this, we believe the issues will still be current in 2019 when the first rent review falls due on the car park. If that happens, the administrators have already confirmed advance instructions.

28. PLANNING AND POST-PLANNING
WORK THE SITUATION AND THE CLIENT – WATCH OUT FOR CONFLICTS BUT WITH TRANSPARENCY AND SIGN-OFFS BY INTERESTED PARTIES – PROTECTION
PROBABLY FEES WILL BE 2,500% OF ORIGINAL INSTRUCTION OVER 5 YEARS.
MORE PLEASE!

29. VALUERS – WE ARE TRAINED TO LOOK FOR THE ANGLE – SOME SEEM TO HAVE FORGOTTEN!
- Low Fees and Volume Work – “STUPID BUSY”
- Low Fees, Volume Work and Conversation – Where Possible – “SMART BUSY”

30. MESSAGE Look beyond what you are asked, and behave, just for a short while, like your entrepreneur Client and see where it takes you. You have the knowledge, the skills and the professionalism…… USE IT!

31. Thank You Roger G. Messenger BSc FRICS FIRRV MCIArb REV Hon. CAAV
MIPAV (Hons) RICS Registered Valuer
Vice Chairman, TEGoVA
Chairman of REV Recognition Committee
Wilks Head & Eve