ADHS5 - Valuation advice for investment properties for FY end March 2025

1.1 OPDC owns 11 properties, both directly owned by OPDC and those owned by subsidiary companies. These are a mixture of commercial, light industrial, leisure and vacant properties with value at purchase of c£125m. These are classified in the accounts as investment properties, and the accounting regulations (specifically IPSAS 16 Investment Property and IAS 40 Investment Property), which state:

•  “An entity is encouraged, but not required, to determine the fair value of investment property on the basis of a valuation by an independent valuer who holds a recognized and relevant professional qualification and has recent experience in the location and category of the investment property being valued.”

1.2 Whilst it is not a requirement to have a valuation at year end, it is best practice to do so.

1.3 The valuation will also enable OPDC to gain greater understanding of, and better manage, its financial risks and opportunities.

2.1 A year end valuation of investment properties for accounting purposes is a standard piece of work which can be carried out by a large number of companies which have suitably qualified RICS (Royal Institute of Chartered Surveyors) staff.

2.2 We will appoint a company with suitable relevant experience to carry out the valuation and engage with them throughout the process to ensure it runs smoothly.

3.1 The appointed supplier will provide a valuation report which values all the investment properties held in the OPDC group.

4.1 This proposal is an important part of the stewardship of OPDC’s land & property assets. As the custodian of a major regeneration area and being a large landowner, it is essential that OPDC fully understands the value of its assets.

4.2 This information will help support OPDC’s intermediate asset management activities and in the longer run will help support the delivery of the regeneration.

4.3 Furthermore, although not a requirement for the year end accounts, it is best practice to have a valuation of investment properties at each year end.

5.1 As part of the procurement exercise OPDC will agree clear timetables and deliverables for the project.

5.2 The Project Lead will be the Senior Finance Business Partner and the Senior Responsible Officer will be the Head of Finance.

6.1 There are no significant monetary risks with this piece of work.

6.2 The work presents the Corporation with the opportunity to obtain a clear assessment of our asset portfolio to date which will inform much of the work we do next financial year in relation to investment and asset management.

7.1 OPDC must have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and victimisation as well as to the need to advance equality of opportunity and foster good relations between people who share a protected characteristic and those who do not.

7.2 The protected characteristics and groups are: age, disability, gender reassignment, pregnancy and maternity, race, gender, religion or belief, sexual orientation and marriage/ civil partnership status. Fulfilling this duty involves having due regard to: the need to remove or minimise any disadvantage suffered by those who share a protected characteristic or one that is connected to that characteristic; taking steps to meet the different needs of such people; and encouraging them to participate in public life or in any other activity where their participation is disproportionately low. Compliance with the Equality Act may involve treating people with a protected characteristic more favourably than those without the characteristic. The duty must be exercised with an open mind and at the time a Decision is taken in the exercise of the OPDC’s functions.

8.1 Understanding the true value of our properties is integral to long-term investment considerations as we prepare to engage the market for partners to bring forward the Old Oak scheme. This will act as one of many steps that enables us to effectively ascertain our capacity to deliver inclusive and sustainable development.

9.1 There are no other considerations that need to be considered in the taking of this decision.

10.1 No one involved in the preparation or clearance of this Form, or its substantive proposal, has any conflict of interest.

11.1 As noted above, the yearend valuation of investment properties is an important part of the process in preparing OPDC’s financial accounts. This cost will be funded from the 2024-25 budget and beyond.