The property consisted of a few office units and had been acquired and refurbished to comprise a fully functioning cosmetic hospital with operating theatres and en-suite bedrooms. The accepted approach to the valuation of private hospitals is to apply a contractors approach to valuation which seeks to reach an adjusted replacement cost which is decapitalised to give an annual equivalent. The Valuation Officers view, quite understandably, was that these units must now be valued higher than an office rental basis.
After lengthy discussions with the VO, it was agreed that the base value should be the rental equivalent of an office and it was also argued and accepted that much of the cost of refurbishment were non rateable and therefore a much lower amount was taken and amortised to give an addition to reflect the hospital fit out. This produced a much reduced Rateable Value and substantial savings for the client.
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