Service: Asset Valuation & Advisory | Sector: Universities
We were instructed to value the entire heritable property estate on behalf of Queen Margaret University for financial reporting purposes. Their buildings are all purpose built and located on a large single site. The valuation was required within a timeframe to suits the University’s reporting requirement.
All properties were inspected, and the academic buildings measured as part of a previous valuation exercise.
The non-residential buildings provide a range of accommodation from lecture theatres to laboratory space and sports facilities to a biomass boiler house and are therefore defined as specialised properties. The absence of comparable evidence required us to adopt the Depreciated Replacement Cost approach for the valuation.
The residential estate comprises a number of similar buildings forming a student village and a Discounted Cash Flow was used to calculate a valuation given the operational nature of the assets. To this end we obtained revenue and expenditure information from the university for the past five years and prepared a sustainable cashflow to which we applied an appropriate exit yield and discount rate.
We then prepared full financial forecasts for each scenario which were accompanied by detailed annotation. This then enabled us to provide an indicative opinion of value of each completed scheme.
Our approach to the valuation resulted in a final overall value in excess of £120 million, which we reported on time to the client alongside suggested wording for inclusion in their financial accounts. Finally, we assisted our client in responding to their Auditors’ queries regarding valuation matters.