• “And thank you for emailing your (very substantial) report to me. Your analysis and comments are excellent, forthright and challenging, and more insightful than my own advisors!” - Pharmacist, Major Brand
    “…You were very thorough. It is always good when the facts are provided in detail leaving no questions to be asked.” - Large Retail Landlord
    “Hi Donald, thank you for confirming what I already thought about Shopping Centres and retail Leases/Values.” - Business Valuer
    “I have known and collaborated with Don Gilbert for four years, ever since I first met him at a conference in Korea. I have found him to be refreshingly numerate, candid, and outspoken on matters concerning the retail property industry, more » - Vernon Martin, President APRI
    “Thank you very much for all the time, effort, and consideration you have put into our submission. We are extremely happy with your service… We feel extremely fortunate to have discovered you – it is very rare to find an more » - John, Grocery Retailer
    “Don is one of the most qualified and experienced retail lease valuers in Australia and has qualified as a retail rent specialist arbitrator by both IAMA and RICS. Unlike many traditional valuers, he regularly seeks newer and better valuation methodologies more » - Matt Myers, Senior Univ. Lecturer
    “I just want to tell you how much I enjoyed your presentation yesterday… I’m the guy who thanked you for “telling it as it is” afterwards. I agree with your belief that most rents are over priced and impact on more » - Business Valuer
    “Don. You should write the Valuer’s manual on retail property valuation – the detail you go into is impressive.” - Leading NSW Specialist Retail Valuer
    “Thanks for your efforts!” - Dominic, Owner of Multiple ACT Delicatessens
    “I have known Don for many years and worked with him in both South Africa and Australia. Don is a dedicated retail property professional and continues to strive to know more about his industry and how to make his clients more » - Dr. Brent Stephens
    “Don has excellent knowledge of all facets of retail property and leases in general. He looks at each lease and business on an individual basis and understands the business’ performance with respect to its physical location rather than just a more » - Richard Lord, Property Professional
    “Thank you Don for all your help and for all the contributions that you make to the retail property industry.” - NSW Specialist Retail Valuer
    “Don has a high level of experience as a specialist retail valuer, arbitrator/mediator and on tenancy determination/submission matters.” - John Kendall, Property Advisor
    “Don excels at what he does. He is the most veracious provider of diligent retail property valuation work I have come across in my 27 years as a Real Estate Agent. I would recommend Don whenever a thorough examination of more » - Jonathan Blocksidge, Director REIQ
    “As a retailer with over 15 years Brisbane CBD experience, we engaged Don for independent expert advice to assist us in proving damages to the landlord who was a major industry superannuation fund. I am proud to confirm that Don’s more » - Ermanno Nobilio, Specialty Retailer
    “Don is a clear-sighted, down-to-earth business professional with a sharp sense of where economic value comes from, and how to deliver; and how to measure it. Engaging with him on retail property valuation takes me instantly from theory to the more » - Govindan (“Govind”) Nair
    “Thanks Don. Much appreciated. And thanks again for your fine talk yesterday it is a real pleasure to listen to someone that has such a great understanding of their specialty field and says it like it is. We need more more » - QLD Business Valuer
    “Don has showed the highest level of integrity and trustworthiness in my dealings with him. His tenacity and attitude to succeed are legend. He makes sure he delivers.” - Mathew Tait, Pharmacist
    “And yes, you definitely gave me some valuable tips! You have some very interesting stories. I hope that one day I will have some exciting experiences to talk about too!” - Solicitor
    “I’ve been on most sides of real estate ownership and management. As a developer, owner, professional manager, and tenant. Don has a refreshingly rational, economically and mathematically literate approach to retail property valuation which avoids many of the rule-of-thumb pitfalls more » - Graham Young, Publisher
  • Case Studies

    Examples of disputes settled on one (our) expert’s report alone

     
    State/Jurisdiction: Queensland District Court (referred from QLD Tribunal)
      Complexity: 7.5 / 10
    Parties to Dispute: Plaintiff: Landlord of small shopping centre
    Defendant: Tenant (food shop)
    Type of Dispute: Outgoings Dispute
    Description of Dispute: The tenant claimed that the outgoings being charged were unfair. The Landlord needed to take action to prove the legitimacy of the costs and thereby prevent further claims from other tenants in the centre. Both parties were represented by solicitors.

    Instructions Received from Plaintiff (Landlord):

    Don was retained as a retail leasing consultant for his knowledge and experience in retail disputes and his ability to be an Expert Witness should the need arise. His instructions were:
    • 1. To undertake a detailed forensic analysis of the Landlord’s accounts and expenses incurred relating to the maintenance, upkeep and operation of the shopping centre;
    • 2. To prepare and Expert’s report on his findings.
    How Settled: Settlement reached by parties’ legal representatives before Court hearing with Don’sExpert Report as the only external reference point
    Comments:
    The Queensland Civil and Administrative Tribunal (QCAT)had jurisdiction to hear this matter and could easily have appointed an appropriate expert but, surprisingly, referred it to District Court instead.
    State/Jurisdiction: Queensland (no court involved)
      Complexity: 8.5 / 10
    Parties to Dispute: Plaintiff: High-profile former Olympianassociated with swim school
    Defendant: Major A-REIT, owner of shopping centre where facility located
    Type of Dispute: Alleged “unintended misrepresentation” of Olympian with consequential breach of quite use and enjoyment of swim school premise. Plus additional damages as detailed below.
    Description of Dispute:


    The name of the Plaintiff in this case was associated with a swim school. In the process of centre redevelopment by the Defendant, the premise of the swim school had been allowed to deteriorate to the extent that it “misrepresented” the very name of the former Olympian.

    Not only did this negatively affect the attendance and income of the school (and therefore the income of the former Olympian from this source) the shoddy state of the premise was potentially damaging to the personal “brand” of the Olympian and this “brand” damage would extend beyond the term of the lease, causing damage to the Olympian’s passive income earned from product endorsements, etc.

    The possibility of this type of extended damage and large dollar amountsinvolved, which had not been identified by the Olympian’s legal representatives, meant that there was the potential for a major claim against the Defendant, one that was likely to cause significant adverse publicity.
    Instructions Received from Plaintiff (Landlord):

    • 1) Analyse swim school’s Annual Financial Statements and business records to provide an opinion of losses (a forensic accounting exercise);
    • 2) Estimate possible losses resulting from damage to personal “brand”.
    How Settled: Expert’s Report was the sole opinion used to settle this dispute
    Although both parties were both legally represented, the actual settlement was negotiated without their involvement; they were only used to draw up the “settlement contract”.
    Comments:
    Confidentially, the Defendant’s national representative complimented the single expert’s report for being extremely thorough and clear. The report quantified losses within the lease term at $220,000 and losses to personal brand beyond the lease term at $950,000.
    State/Jurisdiction:Western Australia Supreme Court
      Complexity: 8.5 / 10
    Parties to Dispute: Plaintiff Menswear Store, part of reasonably large retail chain
    Defendant: Major A-REIT, owner of major shopping centre where store located
    Type of Dispute: Alleged Breach of ‘Quiet Use & Enjoyment’ of Lease
    Description of Dispute:
    Shopping centre management leased the space in front of the menswear shop to a juice bar. Not only did this reduce the visibility of the shop within the centre, it also set up a ‘clash of cultures’ between the shop’s client base and the groups of teenagers who frequented the juice bar and who Plaintiff alleged were‘crowding’ access and egress to the store, swearing, spilling drinks, etc.
    Despite repeated attempts by Plaintiff to get centre management to address and correct this breach of quiet use and enjoyment, centre management failed to do so causing the Plaintiff to become ‘frustrated’ and file suit. This situation could easily have been avoided ‘but for”poor management and the Defendant’s ongoing ‘failure to rectify’.

    Both parties were legally represented by established law firms. Plaintiff had also retained a PhD-qualified accountant as an Expert who had provided a 50-page report at a cost of $50,000. Defendant’s Expert was an economist with substantial experience in shopping centre analysis.
    Instructions Received from Plaintiff (Landlord):

    Don was retained as a Specialist Retail Valuer to provide the following retail property consultant services:
    • 1. Peer-review Expert’s report to determine whether or not the calculations of loss were sound and reasonable (a forensic accounting exercise);
    • 2. Analyse and respond to report submitted by Defendant’s Expert;
    • 3. Establish and detail causal links between actions of Defendant and losses of Plaintiff.
    How Settled: Settlement reached at mediation based on the strength of Don’s single report


    The matter did not go to hearing partly due to an illness in Plaintiff’s family. However, Don’s Expert Report was critical to the amount of damages paid to the Plaintiff by:
    • 1. Establishing that Plaintiff’s Accounting Expert’s calculations were sound and reasonable, backing them up with a much simpler methodology. Using forensic analysis, Don was able to reduce the 38,000 figures used in support of the Plaintiff’s case to a single, half-page table that clearly isolatedcausal factors from inconsequential ones and showed the losses related to them.
    • 2. Analysing the Defendant’s Expert’s report to reveal flawed assumptions and modelling that supported Defendant’s case and how they were used in complex graphs to produce incorrect results and support flawed arguments that did not represent the situation accurately or fairly.
    • 3. Deconstructed the many assumptions and variables used in the Defendant’s case showing how some were too remote to have any causal influence and others were specious.
    • 4. Used key performance indicators (KPIs) from other stores in the group and industry benchmarks to establish reasonableness of store’s performance, explored local economic and environmental factors and ultimately proved that the decline of the Plaintiff’s store could be directly linked to the shopping centre management’s actions and inaction.
    Comments:

    ALPC’s services were retained based on a 45-minute phone conversation in which Don’s estimate of losses incurred was similar to that arrived at by the Plaintiff’s accountant.This case took advantage of the full breadth of Don’s knowledgeand experience, including his understanding of general retail business economics (accounts and accounting principles), marketing and market analysis, retail propertyvaluation and economics, and his ability to find the important facts of a case among large amounts of complex information.
    State/Jurisdiction:Matter referred from Queensland Tribunal to District Court.
      Complexity: 7.5 / 10
    Parties to Dispute: Landlord/tenant legally represented.
    Instruction: provide forensic analysis and expert’s report for outgoings dispute.
    Type of Dispute: Outgoings dispute for landlord.
    Description of Dispute:

    Complex forensic report for outgoings dispute.Quantum not significant. Action needed to prevent further claims.

    How Settled: Settled before hearing by legal representatives.Expert’s report was the sole opinion used as reference point.
    Comments:

    Surprise referral to District Court from QCAT. QCAT could easily have appointed appropriate expert and had jurisdiction to hear matter.
    State/Jurisdiction:WA Supreme Court matter (did not go to hearing; illness of Plaintiff’s family member; settled at mediation).
      Complexity: 8.5 / 10
    Parties to Dispute: Breach of quiet use and enjoyment major A-REIT.


    Instructions:
    • 1. Peer review Plaintiff’s expert (a PhD qualified accountant) and provide back-up calculations, i.e. forensic     accounting exercise from business records;
    • 2. Respond to Defendant’s expert (an economist with substantial experience in shopping centre reporting);
    • 3. Link causation to alleged losses;
    • 4. Forensic analysis of 38,000 figures used by the Plaintiff to support its case. This was reduced to a single     table on less than half a page to isolate items affecting causation and to prove or disprove of case
    Type of Dispute:

    Breach of quiet use and enjoyment major A-REIT.
    Description of Dispute:

    Alleged breach of quiet use and enjoyment in major shopping centre as juice bar was allowed to open in front of menswear shop. Clash of “cultures” between the client base i.e. teenagers coming to juice bar “crowding” access and egress, spillages, swearing, etc.Could easily have been avoided “but for” bad poor management decisions of Defendant and failure to rectify.
    An ongoing failure by management to manage overall situation, i.e. planning, organisation, management & control and beach of quiet use and enjoyment, which caused lease to become “frustrated”.Link “reasonableness” to: other stores in group; industry benchmarks; the local environment; local economic factors; link back to the operation of shop in centre.
    How Settled:

    Services engaged after a 45 minute call, when Plaintiff’s representative was provided with almost the same calculations of loss during telephone discussion after it had taken the Ph.D accountant, $50,000.00 and a 50 page report to do.Required to:
    • 1. Establish Plaintiff’s expert’s calculations were sound and reasonable, backed up with simpler     methodology;
    • 2. Isolate Defendant’s expert’s specious responses with flawed modelling, complex graphs with causation     calculations and modelling embedded into argument; demonstrate alternative and why it was relevant;
    • 3. Isolate many variables, including specious ones eg. one’s too remote from causation. Highlight flawed     assumptions and why not relevant.

    Causation linked to loss and quantum calculated to support Plaintiff’s Ph.D expert.Having a sound knowledge in: businesses and business economics (accounts and accounting principles); marketing and market analysis, property and property economics and general economics and modelling same was of great assistance.
    State/Jurisdiction:Did not go to court (potential Tribunal/Supreme Court).
      Complexity: 7.0/10
    Parties to Dispute: Both represented by major law firms.

    Instruction: provide forensic accounting exercise from business records (Annual Financial Statements) to provide opinion of losses.
    Type of Dispute:

    Unintended misrepresentation. High profile former Olympian and major A-REIT.
    Description of Dispute: Unintended misrepresentation;


    • • Consequential breach of quiet use;
    • • Plus potential damage to personal “brand”, beyond lease term plus damage to passive income, i.e. product   endorsements, etc. had not been considered law firm.
    How Settled: Potential for major claim with adverse publicity, etc.

    Expert’s report was the sole opinion. to settle dispute without legal representatives. Legal representatives used to draw up “settlement contract”.
    Comments:


    Confidentially the Respondents national representative complimented single expert’s report for being extremely through and clear. Losses within lease term $220,000, loss to personal brand $950,000 beyond lease term.
    State/Jurisdiction:Did not go to court (potential Tribunal jurisdiction).
      Complexity: 7.0/10
    Parties to Dispute:
    Major superfund and interstate based retail chain. One represented by medium sized Brisbane law firm and small inter-state law firm.Instruction: calculate quantum, i.e. forensic accounting exercise from business records.
    Type of Dispute: Major superannuation fund. Breach of quiet use and enjoyment.
    Description of Dispute:

    • • Loss of derogation of grant;
    • • Early termination of lease;
    • • Failure to maintain traffic, etc.
    How Settled: Settled by the parties’ legal representatives. Expert’s report was the sole basis used by the parties to settle dispute.Settled for around 2/3rd of claim.
    State/Jurisdiction:Queensland Tribunal matter
    Parties to Dispute:

    Major Queensland Government Superannuation fund and clothing outlet. Parties legally represented for quiet use dispute Instructions: experts report for calculating loss; experts report of current market rent for new “take-it-or-leave-it” lease terms; further report as parties failed to act on either of above reports
    Type of Dispute: Breach of quiet use and enjoyment
    Description of Dispute:

    Expert’s report & forensic analysis of challenging business model (including lay-bye sales). Landlord relocated business from L1 of Brisbane CBD property (by overzealous young development manager, lacked: “people skills”, plus negotiating leases). Relocated from B to C-minus location with no traffic. Calc loss during disruption. Direct competitor introduced to natural flow of traffic immediately ahead of Applicants business; provide expert’s report of current market rent for new site; further report as “take it or leave it” lease terms causing significant stress to business
    How Settled: Applicant pressured into accepting “settlement” at Conciliation Conference, well below actual loss.


    Respondent’s solicitors played “delaying tactics” and forced compensation. This caused legal fees to escalate.
    “Take it or leave it” lease terms & comprehensive analysis of proposed rent more than double what it should have been ($180,000 per annum v $80,000). Due to economic uncertainties (Nov 2008) report also suggests cap on maximum rents charged as percentage of turnover.

    A large proportion of purported “incentives” (wide spread practice) covered “first fit” costs of landlord & used as excuse to leverage up rent. Other portion of incentives (and higher rent) likely to damage cash-flow of business at a latter stage in lease.


    Expert’s third report simply summarises above. Matter settle by squeezing the Applicant and forcing settlement by duress.
    State/Jurisdiction:Did not go to Tribunal
    Parties to Dispute:
    Retail landlord and retail anchor tenant Instruction: calculate quantum for mediation, i.e. forensic accounting exercise from business records.A second report was prepared regard to maintenance issues by architect qualified valuer
    Type of Dispute: Breach of quiet use and enjoyment.
    Description of Dispute:

    As above, including failure to maintain premises.
    How Settled: Settled at mediation by parties including legal representatives. At mediation the parties considered a further claim.
    Comments:

    Both matters were settled. Total quantum was for almost double the Tribunal limit at the time on single expert’s report.
    State/Jurisdiction:Tribunal matter
    Parties to Dispute:

    Both parties legally represented: Major A-REIT and multi-store chain.Instruction: provide expert’s report about losses i.e. forensic accounting exercise.
    Type of Dispute: Breach of quiet use and enjoyment
    Description of Dispute:

    Landlord allegedly breached quiet use and enjoyment over sustained period.
    How Settled: Dispute “settled” at Conciliation Conference. In my opinion this was not in equity. The Queensland Tribunal is described as a “landlord’s” Tribunal by its own mediators.
    Comments:

    Lessor’s solicitors calculations had no commercial basis at all. Quantum settle by “bluff”.

    Examples of disputes that have gone to hearing in courts and tribunals

     
    State/Jurisdiction: D & M Pelle Holdings Pty Ltd v Cottrell Pty Ltd (No 2) [2005] ACTSC 82 (29 August 2005).Breach of exclusivity clause in lease; breach of quiet use and enjoyment.Experienced Canberra retailer’s lease breached and damaged Intangible Asset (‘IA’) Value of good flexible lease. Lease (paying higher rent vs anchor grocery store) added value to landlord and tenants assets i.e. principles of AASB 138 (not adequately covered).
    Parties to Dispute: Both parties legally represented.
    Instructions:
    • 1. Provide detailed report to consider “wider market influences on the business” i.e. isolate causation factors back to the alleged dispute; and
    • 2. Review Plaintiff and Defendants expert’s figures in regard to the calculation of losses and damages for the terms of the lease available to the Plaintiff.
    Type of Dispute: Matter thrown out of Appeal Court by three Judges according to Plaintiff.
    Description of Dispute: Delicatessen business paid double the rent the supermarket traded at, had multiple options at current market rent, adds value to property and business assets under AASB 138.Immediately after the supermarket was allowed to trade across exclusive lines and business went into decline.Losses would continue to accrue the longer D & M Pelle Holdings continued to trade.One needed to conduct “forensic” analysis of causation factors including:

    • 1. Economic factors;
    • 2. Catchment factors (demographic factors);
    • 3. Industry matters;
    • 4. The centre, traffic flows, turnover levels, etc;
    • 5. Key anchor (before and after); other competitors;
    • 6. The Plaintiff’s business; and
    • 7. The operator.
    Involved significant modelling, use of best benchmark sources, “cause effect” modelling and calculation of loss flowing.

    How Settled:
    We state we are:“SRV& Land Economist …..member of the Australian Property Institute since 1991. The API NZPI Professional Practice 2004 requires we “practice their (our) vocation with integrity, honour and professionalism, to act impartially and objectively when providing independent advice, and to respect the public interest.” We abide by that Code …. In preparing this report I have applied my knowledge and experience as an expert (SRV and land economist), incorporating property economics, business economics, marketing and my knowledge and application of commercial law, tenancy and contract law.

    I am not an accountant, but I am able to analyse both the Plaintiff and Defendant’s accountant’s calculations of losses and damages. I have considered case law precedent in my calculations. The practical knowledge and experience having specialised in retail tenancy matters for 12 [20] years, has enabled me to consider matters within the business, the centre, lease terms and conditions and wider catchment which would impact on Deli Planet.

    This would naturally assist in assessing sales and profit projections, risk profiles and thus applying discount rates. Queensland Lease Consultants [superseded] have had no prior involvement with the Plaintiff and I have no conflict of interest in this matter. The preparation of an Experts Report and calculating losses and damages are within the scope of the services offered by QLC.”

    Calculation of losses was $911,398 excluding interest. Damages of $799,000 were awarded, plus costs
    Damages in my view did not properly consider future losses i.e. good tenure; flexible lease; mixed two methodologies; tenant not willing seller” i.e. one would pay a premium to acquire cash-flow of business (more traffic growth “but for breach of the lease”).

    Comment: Our figure was the closest to quantum awarded. We were almost appointed for a large case wherein we would have been appointed the Landlord’s expert [2012].
    State/Jurisdiction: We have raised several “miss-trial” matters by the old Tribunal and by QCAT including Schnitzel World Pty Ltd.Comment: Some Chairmen have vacated their positions in QCAT although some of their decisions were/are very good when they did not involve matters where quantum was involved; and more importantly where matters were likely to be appealed. It is opined that one of these Chairman continually meddled in matters where a spouse was also a Chairman.

    One prominent Brisbane businessman used some choice words to describe the person involved. In Brisbane if we are to marry Business Capital to Property Capital then stakeholders need confidence in the court system.
    Where a Chairman has conflict of interest, or a perceived personality clash and they are unable to uphold the objectives of the Act “The object of this Act is to promote efficiency and equity in the conduct of certain retail businesses in Queensland” [This of course omits landlord’s property interests] Any Chairman must declare their position and decline any appointment
    State/Jurisdiction: Tribunal matter Breach of lease quiet use and enjoyment
    Parties to Dispute: Major government landlord and retail newsagency. Tenant represented themselves.Telephone inquiry: volunteer advice in regard to loss.
    Description of Dispute: --------
    How Settled: During a 45 minute telephone conversation, we advised proprietor he had a probable claim, and losses were $60,000. He used methodology suggested, backed up with financial records. Decision was made in favour of Applicant for the amount claimed.
    Comments:
    The Applicant used our advice and methodology. It begs the following questions: Why does QCAT fail to award claims for higher amounts? Why does QCAT subsidise one party’s case invariably Landlord capital? Why does QCAT continue to personalise matters instead of being objective? Why does QCAT hide or not give credit to the person whose expertise they are relying on to make their decisions?

    Rental determinations: Peer Reviews, determinations, submissions to SRVs

     
    State/Jurisdiction: Arbitration matter. Tenpin Bowling. Current market rent. Action launched in District Court.
      Complexity: 8 / 10
    Parties to Dispute: Both parties legally represented by established law firms.
    Instruction: establish current market rent for highly specific use (sporting facility).
    Description of Dispute: Original rent was $215,000. On exercising option proposed rent $220,000.Location extremely poor. Possible/potential threat of new competition from better located/newer facility.Evidence sourced from market.

    How Settled: Landlord’s and Tenant’s experts agreed on current market rent without going to hearing.
    New rent just over $120,000, based on evidence relative to permitted use, location of premises, etc.
    Comments:
    Inflated rents may significantly inflate the value of any property. Prior to acquiring an investment property, it is strongly suggested that one tests the veracity of the leases and the rent levels.
    State/Jurisdiction: Peer Review expert determining for purposes of litigation. Restaurant/café. Current market rent S29 RSLA
      Complexity: 9 / 10
    Parties to Dispute: Single instruction from Landlord’s agent.Instruction: provide expert’s report to Peer Review another SRV’s determination.
    Type of Dispute: Potential litigation Supreme Court.
    Description of Dispute: Extremely complex matter. Two leases over two strata title properties. Two landlords; one business; only parts of leases ran concurrently.Different lease incentives; different attributes; strata titles offered different facilities; one lease included embedded fitout.
    Second Strata Title Landlord wanted to know what rent to negotiate for second premises based on purported determination and or our opinion of current market rent.We were unable to speak to the Tenant to use Profits Method.

    How Settled: SRVSRV had determined current market rent on following basis using Comparison Method:

    • 1. He took lowest rent from evidence (ignored areas used in association with the premises i.e. licenced areas);
    • 2. Highest rent from the “evidence”; the lease rent ignoring licensed areas (the lease never proceeded therefore the “evidence” was not evidence per se;
    • 3. Took the highest and lowest and divided by two.

    He stated that the rent is 30.0% + lower. Here is my determination.Forensic analysis of leases and evidence found some of “evidence” plain wrong; had ignored incentives; had left out licensed areas; did not comply with “process” under 2006 Act.Did he get it right or wrong? We were able to “test” site performance levels in our inquiries. We value/appraised both strata title sites together as one and apportioned our answer. We benchmarked and “tested’ our outcome to other credible sources i.e. as if Profits Method was used.


    The SPVappeared to have got it “wrong” in favour of Landlords. We provided other advice in regard to challenging determinations. We weighed up considerations including lease terms, cost of litigation and suggested Landlord clients adopt determination vs facing a further decline.

    Second lease for second strata title shop was negotiated using our suggested formula and apportionment

    We have a lot more case-studies. This is a sample of some old and new material.It is important to bear in mind that overall the retail shop leases rental market is “over-priced” to substantially over-priced.There have been some substantial decreases at determination and by negotiation. The liquor determination carried out above saw the rent stay the same. Using the Comparison Method ($/M2) and transferring such a figure from one site to the other, equates to valuing or to price a lease “per chance”. When combined with the Profits Method and or seeking to establish reasonable site performance, one is far better able to establish current market rent.

    Lease negotiation

    We do not provide an advocacy service; either a lease consulting or expert determination/expert’s reports. When negotiating leases we apply the same/similar criteria as if we were valuing a lease/and or adding value to the lease via tenure, security of tenure, etc. and not to inflate value of the underlying asset.

    Other matters

     
    State/Jurisdiction: Due diligence
    Parties to Dispute: The inquiry was with regard to the selling price of a shopping centre.The purchaser wanted to know what one might offer as “fair value” on the property.
    Description of Dispute: The asking price was over $20 million.Analysis of leases, and the quality of income streams warranted offering between $13 and $15 million.

    How Settled: There is some interest regarding the offer that has been made by the potential buyer (the client).
    Without further instruction to carry out proper due diligence, it has not been possible to fully verify whether the proposed offer is realistic.

    The current owners (who invested further capital on renovating/refurbishing): could have paid too much because they did not carry out their due diligence and are seeking to recoup their “sunk cost” plus additional capital outlaid.Financiers, potential investors and other related parties (shareholders for example) need to know about these matters, in order to assess risk on income streams.