09-13-2022 SA_2 16 Grosvenor Street London LH YSOM 895 Fall 2022

docx

School

Yale University *

*We aren’t endorsed by this school

Course

808

Subject

Management

Date

Feb 20, 2024

Type

docx

Pages

1

Uploaded by DrWrenPerson1046

Report
Yale School of Management Mgmt 895: International Real Estate Kevin D Gray, FRICS kevin.gray@kevindgray.com 917-597-1278 Skills Assessment #2: 16 Grosvenor Street, London, Leasehold Interest 16 Grosvenor Street is an office building located in the most prestigious part of London: Mayfair. The interest being analyzed is a leasehold interest, as Grosvenor Properties (Hugh Grosvenor, Seventh Duke of Westminster, born 1991, duke 2016) has owned the underlying ground since the 17 th century. This historic building has 15,682 sq. ft. of rentable area including a below ground level. This property is currently occupied by Quintain Services, the tenant of the leaseholder, and pays a net rent of GBP 830,000 per annum. The leasehold interest in the ground is held by SR Advisors, which must pay an annual rent to Grosvenor of 10% of any rent it receives from its tenant. Assume that Quintain Services Limited vacates the premises at the date of sale of the leasehold interest. Further assume that the building can be leased for a sum of GBP 1MM plus reimbursement of all operating expenses (except ground rent) to a replacement sub-tenant. Answer the following: 1. List all Fee Simple Interests: 2. List all Leased Fee Interests: 3. List all Leasehold Interests, indicate primary and sub-leasehold positions: 4. Which ownership position is the most secure? Which is the least secure? 5. What is the assumed new rent per sq. ft. for the office space? 6. What is the return to the investor (grantee or buyer), pre-debt and pre-tax, at a purchase price of GBP 30 MM? 7. If Quintain Services requires a payment of GBP 415,000 for early surrender of lease, what is the return to the investor (grantee or buyer)? 8. Grosvenor receives 10% of any sub-leasehold rent as ground rent. What is the increase in revenue, also pre-tax, to Grosvenor in this transaction? If the Grosvenor cost of capital is 3.5% per annum, what is the incremental value of this transaction to Grosvenor?
Discover more documents: Sign up today!
Unlock a world of knowledge! Explore tailored content for a richer learning experience. Here's what you'll get:
  • Access to all documents
  • Unlimited textbook solutions
  • 24/7 expert homework help

Related Documents

5-3 Project Two-Team Management Plan-etucker.docx
CLC - Jar Case Study mgt-410.docx
Leadership Reflection Week 2 finished.docx
09-13-2022 SA_2 16 Grosvenor Street London LH YSOM 895 Fall 2022.docx
Assignment 5.pdf
09-27-2023 ANSWERS SA#4 Location Risk Analysis Yale SOM 895.xlsx
09-20-2023 SA#4 Location Risk Analysis Yale SOM 895.xlsx
4-3-2 HR Metrics and Evaluations.docx
09-20-2023 SA#4 Location Risk Analysis Yale SOM 895.xlsx
TEST 3.docx
PSM PLAN FINAL.docx
Week 5 assignment Case study anaylsis.docx
Recommended textbooks for you
Text book image
Understanding Business
Management
ISBN:9781259929434
Author:William Nickels
Publisher:McGraw-Hill Education
Text book image
Management (14th Edition)
Management
ISBN:9780134527604
Author:Stephen P. Robbins, Mary A. Coulter
Publisher:PEARSON
Text book image
Spreadsheet Modeling & Decision Analysis: A Pract...
Management
ISBN:9781305947412
Author:Cliff Ragsdale
Publisher:Cengage Learning
Text book image
Management Information Systems: Managing The Digi...
Management
ISBN:9780135191798
Author:Kenneth C. Laudon, Jane P. Laudon
Publisher:PEARSON
Text book image
Business Essentials (12th Edition) (What's New in...
Management
ISBN:9780134728391
Author:Ronald J. Ebert, Ricky W. Griffin
Publisher:PEARSON
Text book image
Fundamentals of Management (10th Edition)
Management
ISBN:9780134237473
Author:Stephen P. Robbins, Mary A. Coulter, David A. De Cenzo
Publisher:PEARSON
SEE MORE TEXTBOOKS
Recommended textbooks for you
Text book image
Understanding Business
Management
ISBN:9781259929434
Author:William Nickels
Publisher:McGraw-Hill Education
Text book image
Management (14th Edition)
Management
ISBN:9780134527604
Author:Stephen P. Robbins, Mary A. Coulter
Publisher:PEARSON
Text book image
Spreadsheet Modeling & Decision Analysis: A Pract...
Management
ISBN:9781305947412
Author:Cliff Ragsdale
Publisher:Cengage Learning
Text book image
Management Information Systems: Managing The Digi...
Management
ISBN:9780135191798
Author:Kenneth C. Laudon, Jane P. Laudon
Publisher:PEARSON
Text book image
Business Essentials (12th Edition) (What's New in...
Management
ISBN:9780134728391
Author:Ronald J. Ebert, Ricky W. Griffin
Publisher:PEARSON
Text book image
Fundamentals of Management (10th Edition)
Management
ISBN:9780134237473
Author:Stephen P. Robbins, Mary A. Coulter, David A. De Cenzo
Publisher:PEARSON
SEE MORE TEXTBOOKS