Gross Development Value

• Known as the value of completed development
• May be estimated by comparison with similar property in the same area
• Sales comparisons method
• Or total rent per annum at which the property can be reasonably be let .
• After estimating total rent , a reasonable allowance for outgoing ( maintenance , repair , supervision etc) is deducted from this figure to obtain the net income per annum .
• The net income is then capitalised by multiplying by appropriate years purchase ( based on recent sales in the area ) .
• The capitalised figure is called Gross Development Value ( GDV) .
• Eg. The rental value of an office block is estimated to be 30 ringgit per m2 . The total floor area is 10,000m2 and the non-lettable area represents 20% what is the GDV if YP is 6% ?
• 10,000m2 x 80% x 30 ringgit = 240000
• YP at 6% = 100/6 = 16.67
• GDV = 40008000
• NFA , GFA
• If to compute rental , make sure it is lettable area or net floor area or net usable area .
• Make allowance for circulation space ( staircase , lift , entrace halls , corridor , etc ) which reamains in control of landlord .
• The percentage of building which is circulation space varies from 5 - 35% depending on type and design of building .