BISICHI MINING PLC ANNUAL REPORT 2017

Financial statements Notes to the financial statements
10. INVESTMENT PROPERTIES
Freehold
£’000
Long
Leasehold
£’000
Total
£’000
Valuation at 1 January 2017 10,550 2,695 13,245
Additions 13 - 13
Revaluation (13) - (13)
Valuation at 31 December 2017 10,550 2,695 13,245
Valuation at 1 January 2016 10,150 2,650 12,800
Revaluation 400 45 445
Valuation at 31 December 2016 10,550 2,695 13,245
Historical cost
At 31 December 2017 5,836 728 6,564
At 31 December 2016 5,823 728 6,551
Long leasehold properties are those for which the unexpired term at the balance sheet date is not less than 50 years. All investment properties are
held for use in operating leases and all properties generated rental income during the period.
Freehold and Long Leasehold properties were externally professionally valued at 31 December on an open market basis by:
Carter Towler 13,245 13,245
The valuations were carried out in accordance with the Statements of Asset Valuation and Guidance Notes published by The Royal Institution of
Chartered Surveyors.
Each year external valuers are appointed by the Executive Directors on behalf of the Board. The valuers are selected based upon their knowledge,
independence and reputation for valuing assets such as those held by the group.
Valuations are performed annually and are performed consistently across all investment properties in the group’s portfolio. At each reporting date
appropriately qualified employees of the group verify all significant inputs and review the computational outputs. Valuers submit their report to the
Board on the outcome of each valuation round.
Valuations take into account tenure, lease terms and structural condition. The inputs underlying the valuations include market rent or business
profitability, likely incentives offered to tenants, forecast growth rates, yields, EBITDA, discount rates, construction costs including any specific site
costs (for example section 106), professional fees, developer’s profit including contingencies, planning and construction timelines, lease regear costs,
planning risk and sales prices based on known market transactions for similar properties to those being valued.
Valuations are based on what is determined to be the highest and best use. When considering the highest and best use a valuer will consider, on a
property by property basis, its actual and potential uses which are physically, legally and financially viable. Where the highest and best use differs from
the existing use, the valuer will consider the cost and likelihood of achieving and implanting this change in arriving at its valuation.
There are often restrictions on Freehold and Leasehold property which could have a material impact on the realisation of these assets. The most
significant of these occur when planning permission or lease extension and renegotiation of use are required or when a credit facility is in place. These
restrictions are factored in the property’s valuation by the external valuer.
2017
£’000
2016
£’000
Bisichi Mining PLC
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