Business Premises
Rental Values
Calculation of the rental value of the offices, business premises or warehouses in using a comparison between the prices on the market and the state of the stock. Each consultation includes a number of our services (study of the location, analysis of the lease, review of the urban development, calculation of the rental value…)
Business Premises
Rental Values
Offices: approach involves comparison with the review of the state of the stock and the levels of prices charged on the market for the premises available.
Business premises, warehouses and logistical platforms: approach involves comparison with the review of the state of the stock and the levels of prices charged on the market for the premises available.
Each consultation includes:
- Study of the location
- Description of the premises
- Analysis of the lease
- Review of the urban development,
- Search for similar entities,
- Calculation of the rental value.
Eligibility study:
During the lease: there are two ways to increase or decrease the rent <80/>1/ Article L.145-38: a material change in the marketability of the local area which has given rise to a change in the rental value of more than 10% <81/>2/ L.145-39: a change in the rent of more than 25%, but only in the case of automatic indexation <82/><83/>at the end of the lease: no eligibility criteria for decreasing the rent, but justification for "lifting the ceiling" is required in order to increase it. There are various justifications, however, they are subject to the interpretation of the courts. There must be a change, however, this is alone is not enough. The change must be significant and have a positive impact on the commercial activity.
Market value of premises
Dual approach: market capitalisation of revenue and comparison with sales in the sector
- Breakdown of the price by land and buildings
- Increasing the value within the framework of construction leases, long-term leases and capital leases.
Urban development is systematically reviewed in order to determine whether there is room for further construction.
Eviction Compensation
In the case of the loss or the transfer of the business assets, main and annex indemnities.
Business Premises
Eviction Compensation
Loss or transfer of the business assets
Civil courts
Possibility of loss or transfer of assets: calculation of the main and annex indemnities
The damages are generally constituted by the transfer of business assets.
The major items are:
- Possible loss of a reduced rent (during the course of the lease or in the case of removing the ceiling)
- Costs of negotiating a new rental agreement
- Moving costs
- Relocation costs
- The costs of double rent
- Loss of wages
- The costs of double rent
- Loss of clientele
- Additional operating costs
- Disruption to business
- Costs of change of head office
The tenant may remain in the premises until an agreement is reached with the owner as to the amount of eviction indemnity, or until a final court order establishes its amount.
Occupation Compensation
In accordance with the criteria established under the Commercial Code, with a potential deduction for occupation (which can range between 0 and 30%).<210/><211/> This is deducted from the eviction indemnities ,<214>with the tenant continuing to pay the rent during the proceedings</214>.
Expropriation Compensation
Calculation of the reestablishment costs, the value of the premises and the business assets.
Business Premises
Expropriation Compensation
Courts of expropriation: specific methodologies
The four key dates are:
- The preliminary survey
- The ruling
- The declaration of public utility
- The judgment (which fixes the date for calculating the price)
Reestablishment costs are only payable in the event of a Declaration of Public Utility <222/><223/><226>Premises: </226> dual approach: land and buildings or whole plot.<227/>The land and buildings approach involves valuing the land and the buildings separately. This is advantageous if the land has not been built on extensively.
The expropriating authority most often chooses the method which is least favourable to the owner of the property subject to the compulsory purchase order. <229/>The compulsory purchase may result in the depreciation of the remainder (the part not subject to the order). <230/>Business assets: </235> calculation of the principal compensation and additional compensation <236/>The principal compensation comprises the value of the right to the lease or of the business assets. <237/><238/>The right to the lease is calculated using the rent differential method, or on the basis of the difference between the free market value and the actual rental value. <239/><240/>The value of the business assets is calculated on the basis of the revenue.