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solve question number 4

Question 5 Your client owns and operates a themed restaurant on the outskirts of a large regional town. ITEM Year ending Year ending 2018 Year ending 2017 2019 GROSS INCOME Meals 222.000 257,000 290,475 Drinks 52,000 80,337 111,121 EXPENDITURE Purchases 170,000 Wages & NI 109,230 Utilities 11,000 Business rates 6,500 Laundry 1050 Insurance 1,200 Repairs to building 500 Stationary 150 Telephone & Comms 1,800 Owners' remuneration 40,000 195,322 111,990 11,500 6,500 1,100 1,500 250 250 1850 45,000 222 299 118,667 12.000 6,500 1,050 1,500 750 260 2000 50,000 ASSETS Fixtures & fittings Stock 30,000 5,000 27,000 4,200 24,000 4.500 a) Making the necessary assumptions and any further allowances, show the two different profits valuation methods available to provide a value of the premises as a going concern. (15 marks) Answer: b) Discuss some of the difficulties and limitations involved with profit valuations leisure properties. (5 marks) Question 4 Complete the comparable matrix. Subject 10 High Street Property Rent E/m2 Rent Matrix Comp 1 20 High Street 36,400.00 E367.68 Adjustments Letting Comp 2 1 Main Street 35,000.00 E343.14 Comp 3 5 Cross Street 60,000.00 E272.73 Review Review Letting Type of Evidence (Letting/Review) Date fixed/reviewed 2 Years 0.25 Years 1 month Today Slightly Infer Good High Street Secondary Location 99 m2 102 m2 220 m2 Size m2 Good High Street 96 m2 (Excluding Basement) 16 m2 basement None 24 m2 (Basement) None Basement/Mezz 5 Years 25 Years 12 Years Length of lease 10 Years n/a 5 Years 3 Years Review pattern 5 Years n/a n/a Travel Agent User Restrictions Not known None None Tenant only Break Clauses n/a Internal Repair FRI Internal Repair Type of lease (FRI) FRI n/a n/a n/a Security of Tenure Yes Total Adjustments 27/29 Main Street Property E/m2 Adustment 19 Cross Street E367.68 15 Main Street E343.14 E272.73 Valuation Estimated Rent/m2 Size m2 Estimated MR 96m2 a) Complete the matrix and provide an estimated market rent (15 marks) b) Clearly stating reasoning and any assumptions