Report & Valuation Canal Front Residential Dwelling Block 17A Parcel 164 53 Baccarat Quay Crystal Harbour Grand Cayman Cayman Islands
Letter of Engagement Client: Ven Poolo 53 Baccarat Quay, Crystal Harbour, Seven Mile Beach, Grand Cayman, Cayman Islands For attention of: Ven Poolo Date: 17 th February 2016 PROPERTY APPRAISAL: Canal front residential dwelling PHYSICAL ADDRESS: 53 Baccarat Quay, Crystal Harbour, Seven Mile Beach, Grand Cayman, Cayman Islands BLOCK AND PARCEL: 17A 164 Dear Ven, INSTRUCTIONS Further to your e-mailed instructions, we confirm that we inspected the above land and buildings at Block & Parcel 17A 164 (the Property ) on 17 th February 2016 and now enclose our Report and Valuation. The valuations, which are expressed as at the date of our inspection, are prepared in accordance with the RICS Valuation Standards as published by the Royal Institution of Chartered Surveyors (incorporating IVS Standards). In reporting we are acting as External Valuers. Please have regard to the caveats, Terms and Assumptions, Definitions and Limiting Conditions.
We are aware that the valuation is required to assess Market Value. In accordance with your instructions, the following bases of valuation will be adopted; Market Rent (MR) Market Value (MV) The inspection of the Property and report was undertaken by Matt King MRICS (Registered Valuer), who has the relevant skill, experience and knowledge (including relevant local knowledge) to value properties of this nature. Our valuations are based upon the information obtained at the date of inspection. Any subsequent alterations to the property of which we have not been made aware, may have an adverse effect on our opinions of value. We not had any previous material involvement with the Property. We do not consider there to be a conflict of interest. We also confirm that we have sufficient Professional Indemnity cover for this instruction. Thank you for your instructions and should you require any further assistance, please do not hesitate to contact us. Yours sincerely, Matt King MRICS Senior Valuer
EXECUTIVE SUMMARY Address 53 Baccarat Quay Crystal Harbour Grand Cayman Block & Parcel 17A 164 Description Floor Areas The Property comprises a detached two storey (plus third floor attic room) 6 bedroom 5 bathroom home with pool, deck, boat dock and double garage on a 0.2925 acre parcel of land Architects Areas Total Area 6,419 sq ft Date of Valuation 17 th February 2016 Market Rent CI$ 144,000 per annum (One Hundred and Forty Four Thousand) Market Value CI$ 2,000,000 (Two Million) Currency Cayman Islands Dollars Key Considerations The Property is situated within the popular Crystal Harbour area and is of recent construction to a high standard with 100 ft canal frontage The Property is fairly large and in a high price bracket, which may restrict demand The general property market appears to be improving and there have been a number of sales of high end homes in Crystal Harbour in recent times
REGISTRATION DETAILS The Property is currently held Freehold. The Land Register is attached at Appendix 1 of this report and we have summarised the details in the table below: Registration Section Block West Bay Beach North 17A Parcel 164 Registered To Christopher J.J. Campbell & Daphine N. Campbell Ownership Title Private Absolute Date Registered 19 th March 2009 Instrument Number 2005/09 Approximate Area Appurtenances Incumbrances 0.2925 acres (12,741sq ft) Please see the Land Register in the appendices Please see the Land Register in the appendices LOCATION The Property is located towards the south-eastern corner of Crystal Harbour, accessed from Crighton Drive in this gated upscale subdivision. The locality provides similar undeveloped parcels and single family homes, generally constructed to a high standard. Crystal Harbour is accessed through The Links Safe Haven Golf Course from Esterley Tibbetts Highway, the main arterial route to George Town. The Property is approximately 3.5 miles to the north of central George Town where all amenities can be found at or close to the central business district.
The Seven Mile beach area in which the Property is located has all major amenities including schools, retail, restaurants, supermarkets and leisure facilities. A Location Plan is attached at Appendix 2 of this report. SITE We have set out below a list of other features and services on the site. Floorplans, plus a Site and Aerial Plan are attached at Appendix 3 and Appendix 4 of this report. Ground Conditions Elevation Shape Frontage Zoning Electricity* Water* Sewerage* Cleared, filled and built over Approximately 4-7 ft above mean sea level Regular 100 ft canal frontage Low density residential Mains electricity from Caribbean Utilities Company Underground mains water Assumed septic system *NB. We would point out that we have not tested these services as part of our inspection or valuation. FLOOR AREA We were provided with architectural floor plans which detail the following Gross External Area: Ground (1 st Floor) 2,983 sq ft 2 nd Floor 2,983 sq ft Attic room 453 sq ft Total 6,419 sq/ft
DESCRIPTION OF PROPERTY The Property comprises a detached two storey (plus third floor attic room) 6 bedroom 5 bathroom home with pool, deck, boat dock and double garage on a 0.2925 acre parcel of land. Photographs of the Property are attached at Appendix 5 of this report. The Property provides the following, which is accessed at ground floor level; Covered full height entrance porch Entrance Hall into Living room Kitchen and dining area Additional family area with patio doors to terrace Guest Bedroom with en-suite bathroom (Shower, WC and basin) Utility room Snug Double garage with electric door opener Second Floor Den/Seating area Master Bedroom with built in closet and en-suite bathroom (with toilet, two vanity units with basins, whirlpool bath and separate walk in shower) Bedroom with walk in closet and en-suite bathroom (with toilet, vanity unit with basin and shower) Bedroom with walk in closet and en-suite bathroom (with toilet, vanity unit with basin and tub in shower) Bedroom with walk in closet and en-suite bathroom (with toilet, vanity unit with basin and tub in shower) Bedroom with walk in closet External Boat dock Pool and outside deck Ground floor covered terrace and first floor balcony Lawn, extensive landscaping and block paved driveway
OUTLINE SPECIFICATION OF CONSTRUCTION Foundations Floor Slab Walling Roof Windows Wall & Floor Finishes Fixtures & Fittings Cabinetry And Kitchen Air Conditioning Assumed reinforced piled concrete foundations Assumed reinforced concrete floor slab Assumed ICF walls. Assumed concrete and concrete block and stud internal walls Timber framed pitched roof with concrete tile seam UPVC windows with screens Tiled floors and part tiled bathrooms Wood floor to one bedroom Carpeted Stairs to and part carpeted Attic room Fixtures in line with the design and location Timber kitchen cabinets with granite worktops, bathroom vanities High end appliances High efficiency central air conditioning CONDITION No wants of structural disrepair were noted during our inspection. This report does not constitute a structural survey and no liability is accepted should structural issues later be found to exist. The building has recently been completed (2012) and is in good repair throughout. With regards to the interior condition, the Property is in very good decorative order and to a high level of finish and specification.
ESTIMATED LIFESPAN The Property is around 2-3 years old and is estimated to have a remaining lifespan of over 50 years, although this is subject to a planned programme of maintenance and cyclical refurbishment both internally and externally. METHODS OF VALUATION In valuing the Property we have adopted the Market Approach of valuation that provides an indication of value by comparing the Property with identical or similar properties for which price information is available and we have adjusted these to reflect differences in ages, size, position and location, design, condition, valuation dates and any other relevant factors. Comparables from within the vicinity of the Property are listed in the following table: Blk Par Price (CI) Chattels Date Acres Floor Area (sq ft) 17A 56 $2,059,041 $348.99 12, Nov, 2015 17A 112 $1,789,116 $393.99 1, Sept, 2015 17A 95 $1,600,000 $285.20 30, Jun, 2015 17A 296 $1,865,500 $351.98 16, Jun, 2015 17A 34 $1,302,000 $339.06 28, May, 2015 17A 111 $1,619,588 $351.85 30, Apr, 2015 17A 38 $1,440,096 $303.18 10, Jun, 2014 Yr Notes 0.37 5,900 06 183 Crystal Drive, 6 beds, 5 baths, pool and dock. Facing Governors Creek. 0.2913 4,541 15 42 Hoya Quay, 4 beds, 4.5 baths, pool and dock. 0.2897 5,610 11 41 Daum Quay, 5 beds, 5.5 baths, pool and dock. 0.2772 5,300 15 Evolution Daum Quay, 5 bed plus 2 dens, 5.5 baths, pool, dock. LEED home. 0.3509 3,840 01 75 Crystal Drive, 4 beds, 4.5 bath, pool, dock. 0.2912 4,603 12 35 Hoya Quay, 4 bed, 3 bath, pool and dock. 0.517 4,750 00 118 Crystal Drive, 4 beds plus den, 5.5 bath, pool, dock. Medium spec. 17A 267 $1,745,764 $353.61 25, Mar, 2014 0.2297 4,937 14 Crystal Cove, new modern spec home with 50ft to water a. 4 beds, 4.5 bath.
Photographs of these units are shown at Appendix 6, if available. In recent times we have noticed an increase in sales volume and agents are reporting an increasing level of enquiries, which seems in general to have had a beneficial impact on values although there has not yet been enough evidence to make any firm conclusions on improvements in the overall property market. The area in which the Property is located has been one of the lesser affected and has appeared to see some growth in recent times, varying between different property types. In general the growth has been in condominiums and larger properties such as the Property. There has been an increasing number of sales and prices also appear to be rising. Of all the comparable evidence we have found on a per sq ft basis the lowest is a fairly basic home that attracted a value equating to approximately CI$285.20 per sq ft and the highest achieved for a new high end property is approximately CI$393.99 per sq ft. The Property is of recent construction, being completed in 2012 to a high specification and is towards the larger end of homes developed in the subdivision. Generally homes in this location comprise between 4,000 sq ft and 6,000 sq ft, although there are some notable much larger properties. The better comparables are 42 Hoya Quay, Evolution, Daum Quay and 35 Hoya Quay. These are all properties built in ICF to a high standard in recent times and we have inspected each of these. These achieved between CI$351.85 per sq ft and CI$393.99 per sq ft but these were generally ultra-modern design buildings. We are therefore of the opinion that the Property would achieve a lower rate than these better comparables, however, the Property is considerably larger and therefore we would also need to apply a discount for quantum.
The larger size of the Property will also mean that the Market Value will push it into a higher bracket for purchasers. We are aware that a fair level of demand exists for properties between CI$1.3 million and CI$1.9 million, but as the end value exceeds this the level of available purchasers falls, which increases marketing periods. In recent times we are aware of other private sales within Crystal Harbour that have been sold but not yet completed and the available stock has been decreasing quickly, which will have a positive impact on values. There is very little land available for sale and land values haven risen sharply in recent times. In Cypress Point North Strata homes comprising approximately 4,000 sq ft have been selling at approximately CI$1,450,000 (CI$362.50 per sq ft). These have the benefit of docks and shared facilities including a clubhouse. We have compiled a list of other similar properties currently being listed for sale, in the table below; Block Parcel Price (CI) Days on mkt Floor Area (sq ft) Price per sq/ft Notes 17A 259 $3,111,900 259 8,000 $388.99 92 Sardinia Close, 5 beds, 4.5 bath on 0.58 acres, built 2009, pool, dock. 89ft canal frontage. 17A 50 $2,787,180 7 5,224 $533.53 28 Galway Quay, 5 bed, 5 bath on 0.37 acres onto sea ultra-modern new home 17A 55 $2,132,000 573 5,100 $418.04 179 Crystal Drive, 5 beds, 4.5 bath on 0.34 acres, built 2006, pool, dock. 100ft canal frontage. 17A 120 $1,803,180 208 6,323 $304.76 39 Hoya Quay, 5 bed, 5 bath built 2008, pool and dock. We note there are four comparable family home listings on the market currently and around 36 land parcels listed on Cireba which are available for development. 39 Hoya Quay is a similar sized home and the list price has just been reduced to circa $300 per sq/ft. However, this is an older standard specified home.
MARKET RENT We have estimated the Market Rent under the assumption of an annual tenancy on standard terms for a residential tenancy which is inclusive of insurance and Strata Fees (where applicable), but exclusive of utilities. We have applied a rate of CI$12,000 per calendar month. MARKET VALUE The market for a property of this nature would likely be owner-occupiers. Therefore, we have not considered an income approach to valuation in our as we believe the property to be best compared with other residential home sales. With the above in mind, we have formed our opinion of value by way of comparison to sales prices using the Market Approach and not the Income Approach, which we would normally use for income generating properties, given the reasons stated. We understand there is an agreement in place on a lease to own basis and the agreed price was US$2,350,000 (CI$1,927,000). Given the individual nature of both the Property and the comparables it is somewhat difficult to arrive at a figure, however given the evidence available and the alternative available properties we are of the opinion that the Market Value is in the order of CI$ 323 per sq/ft. This reflects a significant discount of around 5% for quantum (from $ 340 per sq/ft). We have also calculated the attic space at half rate in this calculation.
SUMMARY OF VALUATIONS Market Rent We are of the opinion that the current Market Rent of the Property, subject to the details herein is in the order of: CI$ 144,000 per annum (One Hundred and Forty Four Thousand Cayman Islands Dollars) Market Value We are of the opinion that the current Market Value of the Property, subject to the details herein is in the order of: CI$ 2,000,000 (Two Million Cayman Islands Dollars) Matt King MRICS (Registered Valuer) Date of Valuation- 20 th January 2016 Our valuation has been prepared in accordance with the RICS Valuation Professional Standards, January 2014 as published by the Royal Institution of Chartered Surveyors.
SUITABILITY AS MORTGAGE SECURITY The market in the locality for this type of property has seen improvement in recent times and marketing periods have shortened. The Property of recent construction, built to a high standard. As properties in the area are fairly individual and difficult to compare which there is a relatively high level of valuation uncertainty for this valuation. The Property is built to a high standard and uses high quality material and has a high quality modern finish, which is popular with purchasers in today s market. However, the Property is fairly large and is within a price bracket where less purchasers exist. We are of the opinion that the marketing period to dispose of a property of this nature would be in the region of 12-18 months given present market conditions providing it were to be marketed at a sensible level. Should the Property have to be sold within a shorter timescale we would advise that the marketing price would have to be discounted to achieve a sale. We have referred to VPGA 9 of the RICS Professional Standards 2014, which deals with the issues surrounding valuation certainty due to the market instability. We can confirm that we have complied with this statement in relation to the lack of comparable evidence. In certain areas the recovery is underway and values are rising but this is mainly limited to the better stock within the Seven Mile Beach area and condominiums within the South Sound area. Based on the comments made within this report, we consider the subject to provide suitable security for loan purposes on the terms reflecting the nature of the property, the risks involved and the value of the interest reported herein at the level reported subject to the Bank s normal lending criteria. The uncertainty and volatility in the market should be reflected in your loan criteria. We have not been supplied with the details of the proposed loan and therefore we reserve the right to review the suitability of the Property as loan security once the terms of the loan are known. Whilst at present we consider the subject interest to have the value reported, further changes in market conditions during the coming months and beyond could have a positive or negative impact on value.
ASSUMPTIONS The Property has clear marketable title and the boundaries indicated on the attached site plan are in accordance with those held at the Land Registry and those over which your charge is to be taken. RECOMMENDATIONS Your legal advisors should prepare a full report on title and check any issues in relation to rights of light, rights of way, restrictive covenants or other encumbrances. CAVEATS AND EXCLUSIONS Please note that we are not advising upon and our valuation excludes the value of removable chattels, furnishings and other non-permanent or non-fixed elements of the permanent structure. We have assumed that no encumbrances are created and that there are no breaches of use, occupation, planning, or other relevant matters during the term of the loan, which could affect both the value and its suitability for loan purpose. ENVIRONMENTAL ISSUES We have not been advised of any contamination to the property. We are not aware of the content of any environmental audit or other environmental investigation or soil survey, which may have been carried out on the property and which may draw attention to contamination or the possibility of any such contamination. For the purposes of this Report, we have assumed that the property is free from contamination and no allowance has been made for any remedial works that may be required. Should it be established subsequently that contamination exists this may affect the contents of this Report and the opinions of value now reported.
APPENDIX 1 LAND REGISTER
APPENDIX 2 LOCATION MAP
APPENDIX 3 SITE PLAN & FLOORPLANS
APPENDIX 4 AERIAL VIEW
APPENDIX 5 PHOTOGRAPHS Living Room Family Area
Guest Bedroom Den
Master Bedroom Master en-suite
Bedroom En-suite bathroom
Garage Rear Elevation
Pool & Dock View from Attic Room Balcony
APPENDIX 6 COMPARABLE EVIDENCE Block Parcel & Address 17A 112 42 Hoya Quay 17A 111 35 Hoya Quay 17A 95 41 Daum Quay Photos
17A 296 Evolution, Daum Quay. 17A 34 75 Crystal Drive 17A 56 183 Crystal Drive
APPENDIX 7 DEFINITIONS MARKET VALUE Market Value is defined by the Royal Institution of Chartered Surveyors and the International Valuation Standards Framework as; The estimated amount for which an asset or liability should exchange on the date of valuation between a willing buyer and a willing seller in an arm s-length transaction after proper marketing where the parties had each acted knowledgeably, prudently and without compulsion. MARKET RENT Market Rent is defined by the Royal Institution of Chartered Surveyors and the International Valuation Standards 230 Real Property Interests as; The estimated amount for which an interest in real property should be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm s length transaction after proper marketing where the parties had each acted knowledgeably, prudently and without compulsion
APPENDIX 8 GENERAL ASSUMPTIONS Unless the Valuer has stated any express or special assumptions above within the main body of this report, the following assumptions apply: 1. That there is clear title to the Property and the boundaries indicated on the Site plan attached over which your charge is to taken. 2. Full planning consent exists for the building (if applicable) in its existing use within there being no outstanding liabilities. 3. Where tenancy details have been provided by the customer these are assumed to be a true reflection of the current position with there being no arrears of rent or breach of covenants contained in the occupational leases. 4. That for owner occupied residential properties vacant possession is available as at the valuation date. 5. That chattels, furniture and items not forming a permanent part of the structure are excluded. 6. That the boundaries and land area are accurate, as we have not carried out a survey to establish boundaries or accuracy of land area. The opinion of value is subject to verification of boundaries and land areas. 7. That no incumbrances, appurtenances or charges are registered which could affect the sale of the property on the open market. 8. That the property and its value are not affected by any matters which would be revealed by a local search (including road matters) and replies to usual enquiries. 9. That all government planning and statutory laws and regulations have been complied with and approvals obtained, including planning permission for any buildings, structures, extensions and alterations, that the condition and use of the property are lawful, that any buildings are correctly located and that all Occupancy Certificates, Planning Board, Building Control Unit, Fire Authority, Environmental Health and Electrical Inspectorate certificates and approvals have, where necessary, been obtained, including for connection of utilities. 10. We have obtained all information from the government Land Registry, realtors (and their CIREBA system) and realtor and/or the property owner. We have assumed it is correct. No guarantees are offered on the correctness of such information, both documented evidence and hearsay, which should be subject to substantiation. 11. That all those covered or unexposed areas which are concealed during the construction process, or were otherwise enclosed, covered, or not accessible during our inspection and which we did not open up, are free from material defect. We therefore cannot offer any warranty as to the construction and condition of such concealed areas. 12. That no deleterious or hazardous materials or techniques have been used and that the buildings and site are free from any contamination. We have not tested for such, although have noted these where we have been alerted to their visual presence. 13. We have also not carried out an investigation of the sub-strata or service installation to the property and this opinion is subject to the ability of the land to accept the required development and the adequacy of the service installations without incurring additional expense. 14. The employment of Bould Consulting Limited in and compensation for preparing this report are in no way contingent upon the opinion of value stated and neither Bould Consulting Limited, or the Valuer have any interest in the subject property, either present or prospective, direct or indirect, financial or otherwise, nor are they associated with the party or agent with whom the client is dealing. 15. The appraiser s fees are not contingent upon an action or event resulting from the analyses, opinions or conclusions in, or the use of, the appraisal.
16. The appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of a loan or investment, nor was the compensation contingent upon the amount of the value reported. 17. This valuation is valid as at the date of valuation only. 18. This report shall be rendered invalid if without an original signature. 19. The report is provided for the sole use of the client. It is confidential to the client and their professional advisers. Bould Consulting Limited gives no warranty, representation or assurance to any third party that the statements, conclusions and opinions expressed or implied in this report are accurate or valid. Any third party who relies upon this report does so at their own risk. 20. Neither the whole nor any part of this report or any reference to it may be included in any published document, circular or statement, nor published in any way without Bould Consulting Limited prior written approval, including of the form and context in which it may appear. 21. That the property is fully compliant with all Planning and Building Regulation restrictions applicable to the property and any further works carried out will be to a competent standard and will be finished to comply with all Planning and Building Regulations. Should this not be the case the valuation is void and cannot be utilised for any purposes whatsoever. 22. That the Strata Corporation is being competently managed by property professionals. That it has in place proper contracts for the necessary services and that these are fully up to date and managed competently. That all of its accounts are up to date and that there are suitable reserve funds to cover all contingencies and foreseeable future maintenance issues. That all necessary insurance policies are in place and at a suitable level to fully protect the asset. That there are no present claims against the Strata Corporation or members of the Executive Committee in relation to the Property. 23. Where we have made a conversion from US$ to CI$ or visa-versa we have used the government rates 0.82. 24. None of our employees, directors or consultants individually has a contract with the client or owes you a duty of care or personal responsibility. In instructing Bould Consulting and us carrying out this valuation you agree that you will not bring any claim against any such individuals personally in connection with our services. 25. This is not a structural or building survey and the extent of our inspection was in accordance with RICS guidelines for inspections for valuation purposes, which is of a limited nature. 26. We cannot offer any warranties, expressed or implied, as to the structural and other condition of the building, standard of workmanship, quality of materials or possibility of latent defects. 27. We did not test services. Should you require such advice we recommend that a further report be obtained. 28. This report is not intended to advise on the effect any defective materials, workmanship, construction or other parts of the property, including those concealed, nor upon the effect such areas may have upon the structural and decorative condition of the property. 29. The Market Value appraisal should not be used as a reinstatement figure for insurance purposes. We have not been advised of the claims history (if any) relating to the property. Should any special risks exist, or there have been any material, serious or recurrent claims then we should be advised of these, as in the light of such further information our valuation may require amendment. 30. This report is not intended to form a Measured Survey, as defined by the RICS and floor areas, where stated, are approximate and for information only. 31. The opinion of Market Value excludes Selling expenses, Legal fees and expenses, Stamp duty or other fees by Government, Furniture, contents and possessions.