Great belated GEM? feedback: from client for supermarket review to evaluate reasonable rent for ONE retail lease
Don Gilbert
Director at 3D Retail Economics & Australian Lease and Property Consultants Pty Ltd seeking to expand SaaS across Globe
Great belated GEM? feedback [Copyright ? 1993 - 2019 Gilbert Family Pty Ltd A.C.N. 154 078 092 as trustee for Gilbert Family Trust. All Rights Reserved] from client for supermarket market review to evaluate reasonable rent for ONE retail lease.
FY 2014 gross rent $450 K; had agreed. We provided full opinion $16 K fees = +/- maybe $240 – 260 K. Were able to controvert Knight Frank opinion based on “untested” numbers; locked in $260 K. By simply "testing" them!
New 5 year option; provided full GEM analysis report. Lessor 5% incr to $310 K; GEM fine-tuned supported small incr say CPI.
In relative terms difference is SMALL. Say $20 K pa. Client did full fitout $900 K and another 5 years added to lease aka 5+5+5. Our fees circa $8,000 = $1,400 for $20,000 benefit.
I am extremely proud of this outcome.
It smashes the Australian Property Institutes Technical Information Paper how to do rental determinations / opinion of market rent. I have written to API raising my concerns. And am waiting for a detailed response ……………….
As at July 2020, when our previous partners wanted to present us with Agreements, it became apparent that we could not do "business" together and I opted to cut ties with them.
No damage done; we had earned no fees; they had put nothing into the business and had not done what they said they would do.
DG 17/11/2019