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Valuation and advisory

Valuation

We have been responsible for, or participated in, over 1,000 valuations in the past three years.

We can supply RICS compliant valuations, Slovene court appointed valuations, or Brokers’ opinions of value.

We have worked on a wide variety of assignments, from small mixed-use real estate assets, to a portfolio of over 600 properties. We have valued Office, Retail, Industrial, Hotels, Restaurants and land for all uses. Clients include banks and other financial institutions, owners of commercial real estate, and investors.

One of the major problems that led to the banking crisis in Slovenia was ill-conceived valuations, and local firms have been largely discredited.

We work to internationally accepted valuation standards, regardless of what kind of valuation we are asked to provide.

If you require a valuation, please contact us today to discuss.

Knowledge is King in today’s globalized world

Cross-border commercial property investment comprises over one-third of all European activity. If international investors cannot find the information they need to be able to properly assess investment opportunities in markets unfamiliar to them, they will go elsewhere. Slovenia is perceived by most investors as an untransparent market with no reliable market information. We make sense of the office, retail, industrial and hospitality markets in Slovenia. We use a combination of desk research, information from Clients and partners, public information, local knowledge, and bespoke research to provide insightful and useful information to our Clients.

What kinds of research studies can we provide?

There are many options, and most are tailor made to individual clients requirements, but here are a few examples:

Market entry report

Such reports are generally prepared for large retailers intending to enter Slovenia. They consist of basic country information such as population, GDP, unemployment etc. along with an overview of disposable income, shopping patterns, retail space availability and costs, and sometimes a list of potential franchise partners. They might also recommend to the retailer how many stores to open over a period of time.

Feasibility study

Feasibility studies are carried out for developers or banks, to establish how viable a project is, what the likely sales or rental value would be, and how long it would take to achieve full occupancy. A feasibility study might also include recommendations for ideal unit sizes in the case of apartments, or special features such as individual climate control in the case of offices. It is helpful for developers to have an impartial view of their project, and how it will appeal to end-users.

Hotel feasibility study

Specialist studies for hotel developers include market reports, which look at the potential for a country or region, and location specific reports, which examine the potential for a particular site. They forecast where guests will come from, what percentage of business would be generated by conferences and other revenue streams, what average daily rate could be achieved and the likely annual revenue per room. They also analyze the required number of staff and costs in order to forecast profit. Most importantly, they recommend the optimum number of rooms, and what category of hotel would work best. They might also provide a sample list of operators that could manage and market the property.

Highest and best use study

This is an appraisal of a development site, with all permitted uses considered and analyzed. Sometimes change of use is also considered. Mixed-use schemes are becoming more and more common, and developers need to know how much of each asset class could be absorbed into the market, and what the likely end value of each would be. In Ljubljana, residential space is worth more than any other asset class, followed by retail, office, hospitality and industrial. On a large site however, it would be a mistake to build only residential – as the market is quite small.  A well-thought out highest and best use study will recommended the optimum mix of homes, workplaces and shops, and possibly some leisure facilities.

Tenant demand report

These reports are generally prepared for developers planning to build a retail project, but sometimes also for office projects. Potential tenants are questioned about whether they would be interested in taking space in the scheme, and if so what rent they would be prepared to pay. This gives the developer a very good indication of likely revenue, what size of development is required, the profile of potential tenants, and how long it would take to fill up the scheme. It helps developers understand the benefits of the location and the scheme and how it will meet the needs of the occupier, which allows them to market the project in the most appropriate way.

Market overview

A market overview can pull together elements from the reports listed above. We recently completed a market overview for an office project that comprised an analysis of all sub-markets in Ljubljana including availability and price; an overview of the project pipeline, a forecast of annual office space take up for the next five years, details of what tenants in Ljubljana value most in an office location and an office building, a tenant mix analysis, and a forecast of likely achievable rent and how long it would take to fully rent the building.

Why is research important?

We recently advised a residential developer planning to build a large project in one of the commuter towns near Ljubljana. We were concerned that the unit sizes were too large, and through one-to-one interviews with other developers in the area, and by looking at historical transactions, we were able to recommend exactly what unit sizes are in demand. This has important implications for the end value, as smaller units have a higher value per m2. It will also help the developer sell out the project quicker, thereby maximizing profits.

A Client with a site in Ljubljana recently asked us to advise on potential use. Information from the municipality indicated it could be used for either a hotel or residential. By looking at historical transactions and current values, we were able to advise that the value of the development would be approximately 40% greater as residential space, than as a hotel.

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