THE VALUER & LAND ECONOMIST – NOVEMBER 1995
Paper lays the foundation for the definition of ‘current market rent’ that was adopted in 2000 by the International Valuation Standards Committee. It explores how critical business ratios in a tenant’s business – including occupancy cost, revenue, gross profit and profit – can be used to understand what level of rent might be appropriate for each tenancy. It also explains how this understanding can improve the accuracy of retail property valuation and enhance the relationship between shopping centre tenants and their landlords.
Understanding and having grasped this critical thinking has enabled the author to: understand and link income streams to risk multipliers and to develop software to evaluate the reasonable rent for retail leases, hence the GEM™ (‘Gilbert Evaluation Methods’) Modelling.
