Memorandum submitted by the Royal Institute
of Chartered Surveyors
The Royal Institution of Chartered Surveyors
(RICS) would like to comment on a specific area which relates
to the Committee's inquiry. While it is inappropriate for RICS
to comment on the terms of inquiry which refer to competition
within the industry, we recognise that responders may make reference
to guidance on the valuation of licensed property when commenting
on the details of the codes of practice, and it may be helpful
for you to have advice on this.
By way of background, the RICS is the world's
leading professional body on all aspects of land, property and
construction and associated environmental issues. As an independent
and chartered organisation, it regulates and maintains the professional
standards of 86,000 chartered members (FRICS and MRICS), many
of whom are practicing land and property valuers. RICS represents,
regulates and promotes the work of these property professionals
throughout 146 countries and is governed by a Royal Charter approved
by Parliament which requires it to act in the public interest.
In 2004 RICS submitted comments to the Trade
and Industry Committee's inquiry into pubcos highlighting the
professional requirements demanded of a valuer of public houses.
Although the questions put in your consultation do not directly
impact on the method of valuation of licensed property, we hope
the following points will be helpful to you:
All members of RICS providing valuations
are required to comply with the RICS Valuation Standards. More
specifically those Standards provide that the valuer must have
knowledge of the particular market within which the property normally
trades and the skills and understanding necessary to undertake
the valuation competently.
Within these Standards, RICS has
provided guidance on the valuation of what is called "trade-related
property", a term that includes pubs as well as other trades
such as hotels, and petrol filling stations. For your information
a copy of that guidance (GN 1 Trade related property valuations
(not printed)) is attached to this letter.
In addition RICS has also published
a Valuation Information Paper entitled The capital and rental
valuation of restaurants, bars, public houses and nightclubs in
England and Wales. A copy of that paper is also attached to
this letter (not printed here).
Both documents are revised from time
to time including some revisions made since 2004 when the previous
enquiry took place.
Should any issues arise on your consideration
of the responses that require clarification of the guidance RICS
would be pleased to assist you.
29 September 2008