Værdiansættelse af erhvervsejendomme

Michael Schnell Hansen

Student thesis: Diploma thesis

Abstract

The main purpose of this thesis is to verify the correctness of the valuation of thirteen investment properties in Copenhagen produces in thirteen sales prospectus. The sales prospectus is made by three different estate agents companies. To understand the market of property investment the thesis begins with a strategic analysis where two strategic models are used. These models are, Porter’ Five Forces and PESTEL. Porter’ Five Forces are used to analyze the internal conditions in the property market in Copenhagen and PESTEL is used to analyze the external conditions that effect the options and limitations in the market for investment in properties, in the specific area of Copenhagen. The rent for residential tenancies is determined trough comprehensive rent legislation, and it is important to know how the residential tenancies are regulated. The rent legislation for commercial leases is less regulated, but there are legislations that will need to be followed. When terms as market value and order for valuation of properties are used, it is important to define the meaning of these concepts. Some of these concepts will be analyzed. The yield requirement, and what it contains, why there are these specific levels, will be analyzed. There are specific levels for market rent for different types of lease for different areas of Copenhagen, an overview of these levels will be examined. There are two recognized valuation models for larger properties, these are, the Yield-model and the DCF-model, a third model is the Comparison-model, compares recent sold properties The Yieldmodel, which is the most common used valuation model, are using operating income for the first year, and a percentage for yield requirement to calculate the value of the property. The last valuation model is the Discounted Cash Flow model (DCF-model), uses future cash flows and discounts them by using the expected required yield conferred growth for the investment. Finally I will use the DCF-model to calculate the valuation of the thirteen investment properties. There will be performed calculations using the estate agents conditions and there will be performed calculations using the different rent legislations for both residential tenancies and for commercial leases. I will also used the recommended growth rates and rent adjustments two make comparisons between the two calculations for controlling any differences . At last I will calculate a best case scenario for one investment property, still within the law and using recommended rates.

EducationsGraduate Diploma in Financial and Management Accounting, (Diploma Programme) Final Thesis
LanguageDanish
Publication date2012
Number of pages108