17556 Investment Property Valuation
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Subject handbook information prior to 2024 is available in the Archives.
Credit points: 6 cp
Subject level:
Postgraduate
Result type: Grade and marksRequisite(s): 12535 Property Investment and Development Feasibility
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.
Description
This subject is designed to foster a deep understanding of theory and practice applied by industry to the analysis of investment and owner-occupied property, within non-residential property market sectors. Students develop a strong theoretical and practical understanding of the established industry-based analysis, informing key decisions relating to property investment value and performance measurement. Relevant primary property market sectors include the commercial, retail and industrial sectors.
Subject learning objectives (SLOs)
On successful completion of this subject, students should be able to:
| 1. | Understand the purpose of valuations, valuation methodologies, and the role of valuers in undertaking such valuations. |
|---|---|
| 2. | Comprehensively understand and apply property valuation methodologies relevant to the assessment of investment grade property. |
| 3. | Demonstrate a practical appreciation of terms and conditions relevant to non-residential lease agreements that impact investment value. |
Course intended learning outcomes (CILOs)
This subject also contributes to the following Course Intended Learning Outcomes:
- Effectively apply a variety of communication skills and technologies in professional contexts (C.1)
- Apply appropriate technical analytic skills to a professional standard (P.1)
- Apply a comprehensive understanding of contemporary portfolio theory in real estate investment (P.2)
- Apply financial principles to property investment decisions (P.3)
- Source, evaluate and use information within defined parameters (R.2)
Contribution to the development of graduate attributes
A graduate of this subject will have the ability to prepare and critically assess appraisals of investment property.
The term CAPRI is used for the five Design, Architecture and Building faculty graduate attribute categories where:
C = communication and groupwork
A = attitudes and values
P = practical and professional
R = research and critique
I = innovation and creativity.
Course intended learning outcomes (CILOs) are linked to these categories using codes (e.g. C-1, A-3, P-4, etc.).
Teaching and learning strategies
This subject is delivered face-to-face in block-mode.
The initial teaching block in this subject is preceded by an online quiz to assist students in reviewing assumed underpinning knowledge completed earlier in their course. Access to the quiz is via the subject Canvas website.
Teaching and learning strategies are otherwise orientated towards the practical application of established valuation methodologies to determine values, financial interests and returns relevant to investment property.
Active learning opportunities are integrated with each learning block session via individual and group exercises. Feedback is interactive for the class exercises.
Additionally, online readings and reference material is provided to support the students understanding of the practical and theoretical framework surrounding this subject.
Content (topics)
Topics covered by this subject include:
- The role and expertise of valuers
- Valuation methodologies
- Identifying different risks associated with different property types and how they may be accounted for within a valuation
- The impact of economic, political and statutory factors that can impact on the demand of property that affects value
- Capitalisation valuation methodology
- Yield analysis (Initial, Equivalent & Reversionary)
- Lessee & Lessor Interests
- Capitalisation Adjustments
- Face & Effective Rental calculations
- Dual Rate valuation methodology
- Legal framework for non residential leases
- Commercial Rents & Rent Review mechanisms
- Critical Lease Provisions impacting value in investment grade property
- Constructing Tenancy & Outgoing Schedules
- Direct Comparison methodology applied to investment property
- Discounted Cash Flow methodology for investment property
- Investment Property Performance Measurement & Reporting
Assessment
Assessment task 1: In-class Test
| Intent: | This in-class test reflects topics covered in Block 1 of this subject. | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Objective(s): | This task addresses the following subject learning objectives: 1, 2 and 3 This task also addresses the following course intended learning outcomes that are linked with a code to indicate one of the five CAPRI graduate attribute categories (e.g. C.1, A.3, P.4, etc.): P.1 and P.3 | ||||||||||||||||
| Type: | Quiz/test | ||||||||||||||||
| Groupwork: | Individual | ||||||||||||||||
| Weight: | 20% | ||||||||||||||||
| Criteria linkages: |
SLOs: subject learning objectives CILOs: course intended learning outcomes |
Assessment task 2: Investment Value Assignment
| Intent: | This assessment task requires student to complete a financial model in excel utilising the Discounted Cash Flow and Capitalisation methods of valuation to determine the market value of a multi-tenanted investment property. Individual tenancy details, market conditions, and factors concerning the physical building will need to be considered within the financial model/s. | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Objective(s): | This task addresses the following subject learning objectives: 1, 2 and 3 This task also addresses the following course intended learning outcomes that are linked with a code to indicate one of the five CAPRI graduate attribute categories (e.g. C.1, A.3, P.4, etc.): C.1, P.3 and R.2 | ||||||||||||||||||||
| Type: | Report | ||||||||||||||||||||
| Groupwork: | Individual | ||||||||||||||||||||
| Weight: | 30% | ||||||||||||||||||||
| Criteria linkages: |
SLOs: subject learning objectives CILOs: course intended learning outcomes |
Assessment task 3: Final Exam
| Intent: | The purpose of this assessment task is to assess student understanding of the subject content. | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Objective(s): | This task addresses the following subject learning objectives: 2 and 3 This task also addresses the following course intended learning outcomes that are linked with a code to indicate one of the five CAPRI graduate attribute categories (e.g. C.1, A.3, P.4, etc.): P.2 and P.3 | ||||||||||||||||
| Type: | Examination | ||||||||||||||||
| Groupwork: | Individual | ||||||||||||||||
| Weight: | 50% | ||||||||||||||||
| Criteria linkages: |
SLOs: subject learning objectives CILOs: course intended learning outcomes |
Minimum requirements
The DAB attendance policy requires students to attend no less than 80% of formal teaching sessions (lectures and tutorials) for each class they are enrolled in to remain eligible for assessment.
Required texts
References
Supplementary course learning materials will be posted to the subject Canvas website.