Instructions:
Overview
A detailed current market valuation of a commercial property together with necessary attachments is to be submitted
by the due date. This valuation report must comply with the ANZPI (Australia & New Zealand Property Institute)
professional practice standard http://anzvps.api.org.au/index.php and follow chapter 8 – Valuation Instructions and
Reports of the prescribed text.
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Students are to prepare a full-speaking narrative long format professional valuation report to a superior industry
standard on either a multi-tenanted commercial office or retail income producing property. Include details of all
valuation calculations, methodology, assumptions & market (sales/rental) analysis. Close attention will also be paid
to field notes quality and extensiveness of acknowledgements.
A separate assignment cover sheet with all details will be available on the vUWS site for this subject . See below.
An investment marketing report is NOT required. Provide all salient details pertaining to the commercial organisation
you have received instructions from including the purpose, interest and basis of valuation. Do not nominate WSU or
the subject coordinator as the instructing party. Keep it realistic and aligned with report purpose. For example:
Ron Asheton of Eastpac Bank or WSU Bank; or Freddie Hubbard, Director of ABC solicitors etc. Educational purposes
is not a valid valuation purpose.
You are required to adopt Discounted Cash Flow (DCF) as your primary method (MANDATORY). Other contributing
factors such as professional thoroughness of information gathering and market activity will is also required. A
comprehensive valuation rationale, methodologies (including primary and supporting secondary check approaches)
and full workings and calculations must be included.
Acknowledged and detailed assistance from a private practitioner is welcomed and ideally should score higher marks.
Plagiarism will however be keenly scrutinised this session. Always acknowledge persons but do not forget identifying
the existence of an industry report is equally important. Please read following through carefully.
For all intents and purposes the foregoing may be viewed as client instructions as the observant student will note that
these issues must be addressed in any quality valuation report. It is left to the student to discern the most appropriate
basis, purpose (insurance valuations and on completion valuations are however excluded), interest to be valued and
valuation methodologies for the chosen subject property. Submitted reports without a properly defined purpose
or a contradictory, conflicting & erroneous purpose attract very low to fail grades. Distinguish between
the basis and the separate underlying reason for the valuation. Current market value is a basis and is NOT a
purpose! (Review Millington text, An Introduction to Property Valuation, Chapter 7 if uncertain or prescribed text
Principles & Practice Ch.8)
– A tenanted building with passing rents is a much better proposition for our purposes than a vacant or owneroccupied building. As per instructions we prefer existing multitenanted lease expiry profile with passing income.
We recommend freehold (fee simple in possession) subject to existing leases. Assess under/over/current market
situations. Valuation of a building on a vacant possession basis is undesirable and will attract discounted marks
compared to a passing rental analysis scenario at the date of valuation (fully let up basis) as reversionary income
will be reflected in the preferred market realistic approach.
– Ideally the subject property/building should have a business or commercial zoning. Confirm and support via
appendices with planning scheme ordinance extract or LGA/consent authority land use table reference. If
existing use rights apply amplify.
– One of the two valuation methods has to be DCF. It cannot be avoided.
– A secondary check method of valuation is compulsory.
– Long term ground leasehold and ACT leasehold is OK.
Details
Further clarification and discussion will be carried out in class and online. Students are expected to peruse the vUWS
posted materials relating Assignment Resources e.g. Due Diligence checklist. As a valuation practitioner the subject
coordinator/assessor will tend to focus on:
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VALUATION REPORT
1. The premises are to be described in terms of size, construction, accommodation, layout and present use. Additionally, students are to outline and
investigate the status of the selected property in terms of town planning conformance considerations.
2. Having regard to the current use of the premises the basis of valuation must be ”current market value”; students are to put forward prime,
supporting secondary (check) methods of valuation and must identify market data presently available to the valuer (e.g. sales, yields, absorption and
rental levels).
3. Additionally, students will highlight the points of comparison discerned in the key sales/rental transactions identified in the rationale‘ section of
valuation report. What attributes assisted their deliberations in arriving at the final value conclusion in accord with the stated report purpose. See
Millington, Ch.7 as per vUWS posting.
4. Students will prepare a full-speaking narrative professional valuation report for the selected premises. The ANZVPS Business Focus 14.3 Reports,
Content and Compilation section specifically refers to self-contained or comprehensive style reporting format.
http://anzvps.api.org.au/14-3-business-focus.php Details of all valuation calculations, methodology, assumptions, and market analysis are required.
Professional standards will encompass instructions, valuation executive summary, evidence and annexures. Especially, students will identify the matters
that must be conveyed to persons commissioning a valuation of the premises selected for this exercise.
The traditional industry reporting format does not preclude scholarly discussion (where relevant) and proper referencing for this subject ’s purposes.
The increased word limit is 2,500 words (excluding appendices) maximum incorporating if deemed relevant, figures, tables/charts, floor and site plans, locality maps, photos/pictures, sales transaction analysis schedules, field
notes, supporting valuation calculations and workings; qualifications, disclaimers, acknowledgements, table of contents, executive summary and reference list. Students must hone, edit and re-edit their reports down to a lean,
concise document. Cultivate a professional and objective narrative tone that flows.
Note exclusions: No regional dispensation on current market value threshold. No single fronted, double storey
lockup shops allowed. No retail bulky goods developments. No single floors of a commercial building allowed. This
means strata floors and legal chambers are effectively voided. A whole strata building of course, isn’t a problem. No
industrial buildings/ complexes. Industrial property is the focus of Principles of Valuation. Commercial office, retail
and mixed uses are the province of this MGMT2001 subject .
It is envisaged that students will consult the lecturer associated with this topic with a view to discussing in some
detail the suitability of the premises selected. The preference is post via property address blog and note the vUWS
assignment related section.
This subject is not to be viewed as a discrete subject area. Students are encouraged to implement and incorporate
skills or ’tools’ acquired from other subject areas into their valuation assignment.
Assignment restrictions
In previous years students tried to submit public hotels, residential towers, a strata suite and industrial buildings
which all failed to meet the client instruction brief. Students are not allowed to:
– Undertake a land use/property type completed in an earlier program/subject;
– Submit an address that has been valued by another student of this subject within the last two years. If you
have any doubts in this respect, you must raise them with teaching staff;
– Submit a subject property address outside their official enrolled residential home state; i.e. NSW students’
property must be in NSW. (However, externally enrolled interstate or overseas students may choose an address
in their home state/territory/country.)
– Undertake on-completion, rental, insurance valuations; nor adopted forced sale value https://www.youtube.com/watch?v=uEture=youtu.be (However, if mortgage security is stipulated for valuation purposes note 8.2 ANZVGN 2 Valuations for Mortgage and Loan Security Purposes http://anzvps.api.org.au/8-2-vgn.php)
Ideally each student selects a different property address. In the past if more than one valuation is carried out for
the same property then the assignment will be marked as one and students will share marks. This policy has been
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changed in recognition of the vast student numerical cohort now enrolled annually. There is no group option but a
maximum of only two students can submit a valuation on the same commercial property address. Only individual
submissions via Turnitin are permitted with no collusion between students allowed.
To avert the above scenario each student will email me, the property use and address of their selected premises for
assignment purposes. First come, first served. The coordinator will not be responsible for incomplete details.
An exterior photograph (jpg.) attached of the subject property is always a good idea as a picture often tells the story
better than copious text. This aids in the ’reply’ feedback. For example, the subject property simply has its address
in the title:
17_West_St_PARRAMATTA_ NSW_2150 6 Sty. Com. Office Bldg.
If you have queries or need to amplify use the comments key etc. Your name & SID # is automatically recorded so
need to waste space keying same.
It is expected that students assiduously organise contacts and finalise arrangements in order to make site inspections,
conduct interviews and secure property specific income/cost data from the first teaching week of Autumn Session.
It is not the coordinator’s role to check duplication. The onus is on students to check and self-monitor. Third &
above subsequent posters will automatically be disqualified unless a first or second poster has publicly withdrawn.
Students are required to check e-mails, announcements & vUWS.
All are required to pre-register their full nominated property address, proper description and any subsequent changes
via email. The non-submission of the above requirement (which virtually constitutes the Title page of the assignment)
will attract a single 5% penalty of available marks.
A property address and use may change if a valid reason is explained to the subject coordinator/tutor. This flexibility
does not void the above requirement.
The subject coordinator has no problem with mentored, fee paying supervised assignment submissions with proper
due acknowledgement of all parties, so long as the employer’s express consents/permission is obtained. There is
also no impediment to adopting a valuation firm or company’s reporting format, jargon or standard descriptions and
endorsements. Spreadsheets, valuation calculations and analysis must be original. If any assistance is provided by a
valuer in any way, then the extent of this assistance must be fully detailed and acknowledged in the report. Permissions
and clearances must be obtained regarding a specific building, especially if a valuation report is being partially utilised
as an information source. Further, the explicit existence and extent of any report (investment/valuation, industry-fee
paying or otherwise) must be clearly identified.
The assignment emphasis will be on the coherence of the property solution to the valuation problem and whether
the story of the property is communicated effectively. The valuation report’s purpose and interest must conform
to the stated valuation approaches. Teaching staff are concerned with sales and rental analysis, relevance to the
marketplace and the methodologies supporting the conclusion. We are not overly concerned with whether the final
current market value is 100 per cent accurate, right or wrong. The prime areas of interest are the soundness of the
valuation process and how well that is represented in the parallel valuation report writing process.
The owners may very well provide the student with dated passing rental or cost data (say, 2 years prior to date
of valuation or earlier). So be it. It is up to students to make their own adjustments and comparisons to current
market levels. Brokers, valuers, centre managing agents (City-scope publications for contacts) and asset managers
etc. may be of further assistance. It is perfectly legitimate for the owners/operators to disguise certain information
if commercially sensitive with appropriate qualifications. You may even be provided with ballpark figures! Just be
certain to quote the proper context.
The property address must always be real, actual and identified.
Non-adherence to minimum presentation requirements (penalty)
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Any unsatisfactory submission will be returned (subject to the coordinator’s discretion and in some instances collegial
discussion), for reworking until such time that it meets the standards required and stipulated. The maximum mark
that can be achieved if an assignment is returned due to non- compliance with stated requirements is 50 per cent of
the available marks.
Submission requirements
The submission date and time is very specific and represents the close of business.
All students (whether internal or external) must submit via vUWS dedicated AssignmentAssignment online. There
is no provision for hard-copy mailing or delivery. Only soft copy reports will be accepted. All hard-copy submissions
will attract an automatic 10 per cent penalty. Do not leave it to the last moment to submit. Ensure a buffer in case
you forget something. Review the marking criteria including vUWS resources. Please follow instructions.
Each student has by default only one attempt for online submission requiring a single incorporated document inclusive
of cover sheet, report and annexed supporting documentation and must be Adobe PDF. Thereafter a delay mechanism
is invoked.
Print completed WSU cover-sheet, sign and scan. Open the PDF file that contains the scan; zoom to the size of
your screen. Open the ”Snipping Tool” (usually found in the start menu) snip the PDF – this creates an image. Now
open your word doc, Insert blank page at the start; insert the snipped image. File >Save as >Change word doc to
PDF in the drop-down box. BOOM! PDF file with cover-sheet.
Warning: Be sure to verify the publisher and virus-scan any programs you download. Generally it is good practice
to reduce content by constant revision and editing. Further reduction can be achieved by compression http://compress.smallpdf.com and screen shots.
Late assignments submitted between the due time and midnight on due date attract a penalty.
An assessment submitted at any time after the due time on the due date will be deemed to be a late submission and
late submission penalties will accrue immediately from the due time and date.
Assignment Related Resources and Assistance
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Marking Criteria:
The gold standard reference imbuing marking critera for the assignment is the ANZPI Professional Practice Standard
for Commercial Valuation report writing. Although now defunct the historical provisions of the Valuers Act (2003)and
Regulations (2005)(as amended) are good indicators of the former regulatory environment. Commercial valuers must
apprise themselves of the immediate past if they are to avoid litigation and understand how contemporary professional
practice evolved.
A detailed marking guide with component weights for assessment 1 task follows but should be read in conjunction
with the the aforementioned Valuation and Property Standards provided on the vUWS site. Best advice is to peruse
vUWS link and resources. The ANZV&PS over-ride any perceived conflict or ambiguity. The following is a list of
those features and hallmarks most commonly associated (often in combination) with a fail grade:
– No purpose or confused/inconsistent purpose of valuation;
– No acknowledgements (must be extensive);
– No supporting check method of valuation undertaken or value provided;
– No reconciliation of valuation approaches; including adoption of spurious averaging of sales evidence;
-Misapplication of units of measurement or comparison;
– No recent or current 2017/19 dated Certificate of Title or Computer Folio Identifier;
– No valuation-file communications or worked calculations;
– No annexed field inspection (subject and sales) notes with in-field sketch plans;
– No disclaimer, limitations, provisos or reservations;
– No photographic evidence (a single exterior front elevation and colour is required);
– No sales transaction analysis lacking both contract dates & parties to transaction; (No detailed direct comparison
commentary relating the selected key comparable sales market evidence highlighted in the valuation rationale‘ to the
subject premises are notoriously classic omissions! )
– No rental comparable analysis, lacking both commencement dates, and direct comparison commentary related to
the subject premises;
– No car parking rental comparable evidence analysed or commented upon.
At best non-compliance with the following will attract only 50% of total assignment marks and complements vUWS
posted due diligence check-list annexure AA) but over-rides any perceived conflict or ambiguity. This due diligence
checklist replicates the coordinator’s own idea of all the headings and logical sequential order of a valuation report.
It is hoped it gives some valuable insight as it was a past marking guide but the number of decision inputs became
too time intensive and hence became obsolete.
Please use recent articles that relate to this assignment, no longer than 10 years old.
Important Note:
A detailed current market valuation of a commercial property together with necessary attachments is to be submitted
by the due date. This valuation report must comply with the ANZPI (Australia & New Zealand Property Institute)
professional practice standard http://anzvps.api.org.au/index.php and follow chapter 8 – Valuation Instructions and
Reports of the prescribed text.
