Appendix
Coriolis Attachment 2 - Existing Value Key Assumptions
June 27, 2017Pages 231–2321 section
Assumptions used for calculating the existing income-producing value of the Christie Point property.
Capitalization Rate: 4.50%Current apartment unit monthly rents: $1,200 (2-bedroom), $1,419 (3-bedroom)Existing units: 113 apartment units and 48 townhouse units
Attachment 2 - Existing Value Key Assumptions
Income Approach
Assumptions used to determine existing value based on the income approach include:
- Revenue and Operating Assumptions: a) Rental rates for existing units are based on information provided by the applicant and are $1,200 per month for two bedroom apartment units, $1,419 per month for three bedroom apartment units and $1,634 per month for townhouse units. b) Parking revenue is assumed to be $35 per month per stall assuming 100% occupancy and 1.5 stalls per townhouse unit, 1.5 stalls for each two bedroom apartment unit and 2.0 stalls for each three bedroom apartment unit. Laundry revenue is assumed to be $10 per month for apartment units and is offered in-suite in townhouse units. c) A vacancy allowance of 1.0% based on a CMHC vacancy rate of 0.8% for purpose-built apartment units in View Royal d) Operating costs excluding property taxes are $3,500 for apartment units and $4,500 for townhouse units. This works out to approximately 23% of Effective Gross Revenue and is based on operating costs for typical purpose built rental projects and MLS data which shows monthly strata fees in the region are around $4.00 per square foot per year for older units. e) Cap rate of 4.5% from Q4 2016 Canada Cap Rate Report from Colliers International which indicates cap rates for multi-family properties range from 4.0% to 5.0%.
Value of Existing Apartment Units Using Income Approach
Source: Coriolis Consulting
| Assumptions | Value |
|---|---|
| Total Gross Floorspace | 113,812 sq.ft. |
| Net Rentable Residential Floorspace | 96,740 or 85% of gross residential floorspace |
| Total Number of Residential Units | 113 units |
| Average Net Residential Unit Size | 854 sq.ft. net |
| Number of Residential Parking Stalls | 175 stalls |
| Market Rental Rates | |
| Residential Units (average) | $1,219 per unit per month |
| Laundry Revenue | $10.00 per unit per month |
| Parking Revenue | $35.00 per stall per month |
| Residential Vacancy Allowance | 1.0% |
| Property Tax Allowance | |
| Residential Assessment | $23,345,804 |
| Residential Tax Rate | 0.583% |
| Residential Property Taxes | $136,128 or $1,205 per unit per year |
| Residential Operating Costs (see notes) | 23.0% of EGI or $3,507 per unit per year |
| Analysis | Value |
|---|---|
| Revenues | |
| Apartment Gross Potential Rent | $1,653,480 |
| Parking Revenue | $73,290 |
| Laundry Revenue | $13,560 |
| Total Gross Potential Revenue | $1,740,330 |
| Apartment Vacancy | $17,403 |
| Effective Gross Apartment Revenue | $1,722,927 |
| Residential Operating Expenses and Property Taxes | |
| Residential Property Taxes | $136,128 |
| Residential Operating Expenses | $396,273.14 |
| Total Operating Expenses and Property Taxes | $532,401 |
| Net Operating Income on Residential | $1,190,526 |
| Capitalization Rate on Residential | 4.50% |
| Capitalized Value of Residential Space (rounded) | $26,456,000 |
Value of Existing Townhouse Units Using Income Approach
Source: Coriolis Consulting
| Assumptions | Value |
|---|---|
| Total Gross Floorspace | 54,480 sq.ft. |
| Net Rentable Residential Floorspace | 54,480 or 100% of gross residential floorspace |
| Total Number of Residential Units | 48 units |
| Average Net Residential Unit Size | 1,135 sq.ft. net |
| Number of Residential Parking Stalls | 72 stalls |
| Market Rental Rates | |
| Residential Units (average) | $1,634 per unit per month |
| Laundry Revenue | $0.00 per unit per month |
| Parking Revenue | $35.00 per stall per month |
| Residential Vacancy Allowance | 1.0% |
| Property Tax Allowance | |
| Residential Assessment | $13,184,196 |
| Residential Tax Rate | 0.583% |
| Residential Property Taxes | $76,876 or $1,602 per unit per year |
| Residential Operating Costs (see notes) | 23% of EGI or $4,508 per unit per year |
| Analysis | Value |
|---|---|
| Revenues | |
| Apartment Gross Potential Rent | $941,184 |
| Parking Revenue | $30,240 |
| Laundry Revenue | $0 |
| Total Gross Potential Revenue | $971,424 |
| Apartment Vacancy | $9,714 |
| Effective Gross Apartment Revenue | $961,710 |
| Residential Operating Expenses and Property Taxes | |
| Residential Property Taxes | $76,876 |
| Residential Operating Expenses | $216,385 |
| Total Operating Expenses and Property Taxes | $293,261 |
| Net Operating Income on Residential | $668,449 |
| Capitalization Rate on Residential | 4.50% |
| Capitalized Value of Residential Space (rounded) | $14,854,000 |
Page 231–232
Extracted from: 2017 06 27 Public Hearing Agenda - Agenda - Pdf