DFL031 (was PBL191) - The ***** Hotel, N*******
Sept 4, 2017 10:34:13 GMT
locutus, justdabbling, and 4 more like this
Post by seeingred on Sept 4, 2017 10:34:13 GMT
I've been having similar problems in understanding the Valuation Report if only because the cited market appraisal analysis seems to be missing.
The Open Market Value is given as 925k, the 90 day valuation 900k yet the 180 day is only 850k. This has already been noted here as a probable error.
How is the crucial £734 psf figure justified? (psf = £ per square foot)
The assumed sale figure is £159,999 per unit. Each of these units is therefore less than 220 squ ft once you allow for all the wasted space in common parts, etc doing this type of conversion. The gross area (sum of two floors) is given as 5,188 squ ft. But extensive gutting the interior might lead to structural problems - I can't find any diagram of how the new 22 units are to be fitted inside the existing structure. If some existing internal walls need to be retained then almost inevitably some of the new units will be larger and some smaller than the average figure. Or maybe only the front facade is to be retained? In this case there would be a high-risk period for investors in which the site would be worth less than it is now. (This is not unknown of course).
236 squ ft is a little over 15 foot by 15 foot - the size of a spacious student room. Again this has already been picked up and yet no response from Lendy.
In Norwich you can buy a purpose built 2 bed flat with over 600 squ ft for £190k
www.rightmove.co.uk/property-for-sale/property-60203855.html
There are plenty of one bed flats for sale at c £90k which are 400 squ ft or thereabouts. Granted that these are in less expensive areas of the city.
Other problems include (apparently) a lack of parking in the neighbourhood. A 2015 planning application envisaged demolishing this hotel and building 2 HMO blocks containing 34 units (HMO = houses for multiple occupancy). One comment on this proposal (which was refused by the planning committee) was the lack of parking. The VR for the present proposed development notes that car parking on site is 'limited'.
Would anyone actually buy a 218 squ ft residential unit in Norwich without allocated parking for £159,999 (159,999/218 = 734 psf)?
The size is little more than the smallest student room of 16 by 9 foot - and this features a tip up bed. 'Student investment properties' are typically sold for between £40,000 and £100,000 depending on the area of the UK.
www.telegraph.co.uk/finance/property/3363942/Student-accommodation-Happiness-is-a-16ft-x-9ft-cube.html
16 by 9 feet is 144 squ ft which is a little above the minimum of 120 squ ft cited as acceptable for sleeping, living and cooking - but at the lower end of the rented housing market.
www.canterbury.gov.uk/housing/houses-in-multiple-occupation/minimum-room-sizes/
We have already seen some questionable valuation documents used by Lendy - those for the Shropshire and Exeter loans come to mind. Yet the 734psf figure is reproduced in the lendy summary for this loan.
The smallest of the spacious Exeter DFL002 apartments is conveniently 1000 squ ft and at £395,000 (£375,000 currently and with stamp duty etc paid) will cost less than 375psf. This is for a prestigious apartment in a very trendy area of an expensive city.
The cheapest two-bed flats (ignoring shared ownership and retirement flats) in Exeter are £100k.
You can easily pay over £400k for a two bed apartment in a better area but typically you get up to 1500 squ ft = 266psf.
Lendy don't actually say they agree with the 734psf figure - which may be significant. They do say "Because this £psqft value seems high relative to other properties in the area we have discussed this valuation with the valuer and are comfortable that the reported Gross Development Value is achievable".
The 734 figure is not only high it's off the charts for normal domestic residential property in Norwich.
Anyone else used this link?
www.gizmodo.co.uk/2017/04/house-prices-per-square-metre/
For Norwich, (and of course there will be pockets of high and low within each area) we get 200 to 250 psf. The figure given for NR2 is is £2408/m2 or 224psf from a total of over 4100 property transactions.
Direct link here : houseprices.anna.ps/
The key figure of 734psf needs justifying. I would also like to see even some basic plans of what is proposed - how much is to be knocked down and how are 22 new units to be incorporated into the shell that is left?
I am minded to think that there is some alternative scheme for this building - something that might achieve the GDV but without needing to include an unachievable 734psf.
The Open Market Value is given as 925k, the 90 day valuation 900k yet the 180 day is only 850k. This has already been noted here as a probable error.
How is the crucial £734 psf figure justified? (psf = £ per square foot)
The assumed sale figure is £159,999 per unit. Each of these units is therefore less than 220 squ ft once you allow for all the wasted space in common parts, etc doing this type of conversion. The gross area (sum of two floors) is given as 5,188 squ ft. But extensive gutting the interior might lead to structural problems - I can't find any diagram of how the new 22 units are to be fitted inside the existing structure. If some existing internal walls need to be retained then almost inevitably some of the new units will be larger and some smaller than the average figure. Or maybe only the front facade is to be retained? In this case there would be a high-risk period for investors in which the site would be worth less than it is now. (This is not unknown of course).
236 squ ft is a little over 15 foot by 15 foot - the size of a spacious student room. Again this has already been picked up and yet no response from Lendy.
In Norwich you can buy a purpose built 2 bed flat with over 600 squ ft for £190k
www.rightmove.co.uk/property-for-sale/property-60203855.html
There are plenty of one bed flats for sale at c £90k which are 400 squ ft or thereabouts. Granted that these are in less expensive areas of the city.
Other problems include (apparently) a lack of parking in the neighbourhood. A 2015 planning application envisaged demolishing this hotel and building 2 HMO blocks containing 34 units (HMO = houses for multiple occupancy). One comment on this proposal (which was refused by the planning committee) was the lack of parking. The VR for the present proposed development notes that car parking on site is 'limited'.
Would anyone actually buy a 218 squ ft residential unit in Norwich without allocated parking for £159,999 (159,999/218 = 734 psf)?
The size is little more than the smallest student room of 16 by 9 foot - and this features a tip up bed. 'Student investment properties' are typically sold for between £40,000 and £100,000 depending on the area of the UK.
www.telegraph.co.uk/finance/property/3363942/Student-accommodation-Happiness-is-a-16ft-x-9ft-cube.html
16 by 9 feet is 144 squ ft which is a little above the minimum of 120 squ ft cited as acceptable for sleeping, living and cooking - but at the lower end of the rented housing market.
www.canterbury.gov.uk/housing/houses-in-multiple-occupation/minimum-room-sizes/
We have already seen some questionable valuation documents used by Lendy - those for the Shropshire and Exeter loans come to mind. Yet the 734psf figure is reproduced in the lendy summary for this loan.
The smallest of the spacious Exeter DFL002 apartments is conveniently 1000 squ ft and at £395,000 (£375,000 currently and with stamp duty etc paid) will cost less than 375psf. This is for a prestigious apartment in a very trendy area of an expensive city.
The cheapest two-bed flats (ignoring shared ownership and retirement flats) in Exeter are £100k.
You can easily pay over £400k for a two bed apartment in a better area but typically you get up to 1500 squ ft = 266psf.
Lendy don't actually say they agree with the 734psf figure - which may be significant. They do say "Because this £psqft value seems high relative to other properties in the area we have discussed this valuation with the valuer and are comfortable that the reported Gross Development Value is achievable".
The 734 figure is not only high it's off the charts for normal domestic residential property in Norwich.
Anyone else used this link?
www.gizmodo.co.uk/2017/04/house-prices-per-square-metre/
For Norwich, (and of course there will be pockets of high and low within each area) we get 200 to 250 psf. The figure given for NR2 is is £2408/m2 or 224psf from a total of over 4100 property transactions.
Direct link here : houseprices.anna.ps/
The key figure of 734psf needs justifying. I would also like to see even some basic plans of what is proposed - how much is to be knocked down and how are 22 new units to be incorporated into the shell that is left?
I am minded to think that there is some alternative scheme for this building - something that might achieve the GDV but without needing to include an unachievable 734psf.
