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The Point, Boscombe

DATE: 19 Mar 2014

FTT, ref CH1/00HN/OCE/2013/0048

This was a collective claim of a large high value modern block on the sea front where the issues were the deferment rate and capitalisation rate. The tenant’s valuer argued for a deferment rate of 5.75% on the ground that there was a risk of lower growth and greater obsolescence than in PCL. The Tribunal rejected these contentions, adopting the standard rate of 5%. Unusually the capitalisation rate was also in issue, because there was a substantial aggregate ground rent rising from £25,500 to £178,500 in 2122. The Tribunal relied on market evidence, and made a discount for the effect of the Act to arrive at a rate of 6.75%. The premium was determined at £782,500.

The decision is available at

Thomas acted for the landlord.