Cohesive Consistent Confident

Henry Boot PLC
Annual Report and Financial Statements for the year ended 31 December 2015
www.henryboot.co.uk
Stock Code: BHY
Financial Statements
Notes to the Financial Statements continued
for the year ended 31 December 2015
13. Investment properties continued
The sensitivity analysis to significant changes in unobservable inputs relating to fair value measurements (Level 3) are set out below:
Impact on valuation 2015 £’000
Industrial Leisure Mixed-use Residential Retail
Yield – improvement by 0.5% 898 979 3,556 — 1,855
Rental value per sq ft – increase by £1 average 2,820 768 4,475 — 2,520
Tenancy discount – increase by 1% — — — 50 —
Impact on valuation 2014 £’000
Industrial Leisure Mixed-use Residential Retail
Yield – improvement by 0.5% 1,125 608 3,483 — 1,520
Rental value per sq ft – increase by £1 average 3,059 309 3,982 — 1,476
Tenancy discount – increase by 1% — — — 44 —
The sensitivities have been selected by management on the basis that it considers these measures to be a reasonable expectation
of likely changes to the significant unobservable inputs in the next twelve months.
The property rental income earned by the Group from its occupied investment property, all of which is leased out under operating
leases, amounted to £8,216,000 (2014: £8,026,000). Direct operating expenses arising on investment property generating rental
income in the year amounted to £540,000 (2014: £327,000). Direct operating expenses arising on the investment property which
did not generate rental income during the year amounted to £1,023,000 (2014: £1,101,000).
At 31 December 2015, the Group had entered into contractual commitments for the acquisition and repair of investment property
amounting to £776,000 (2014: £11,167,000).
Investment property under construction
Class
Fair value hierarchy
Industrial
Level 3
£’000
Land
Level 3
£’000
Leisure
Level 3
£’000
Office
Level 3
£’000
Retail
Level 3
£’000
Fair value
At 1 January 9,344 6,248 1,833 4,283 20,735 42,443 41,867
Subsequent expenditure on
investment property 6,150 184 1,711 1,245 2,441 11,731 10,351
Capitalised letting fees 56 — — — 81 137 73
Amortisation of capitalised
letting fees (5) — — — (2) (7) (18)
Disposals (2,577) (1,944) — — (408) (4,929) (2,493)
Transfer to assets held for
sale (11,812) — — — — (11,812) —
Transfer to inventories (4,354) (2,376) — — (544) (7,274) (3,081)
Transfers to completed
investment property — — (3,940) (1,575) (1,777) (7,292) (1,405)
(Decrease)/increase in fair
value in year 3,716 — 396 547 (6,039) (1,380) (2,851)
At 31 December 518 2,112 — 4,500 14,487 21,617 42,443
Adjustment in respect of
tenant incentives — — — — — — —
Adjustment in respect of tax
benefits — — — — — — —
Market value at
31 December 518 2,112 — 4,500 14,487 21,617 42,443
2015
£’000
2014
£’000
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