GAYRİMENKUL DEĞERLEME RAPORU

REAL PROPERTY APPRAISAL REPORT
SAF GAYRİMENKUL YATIRIM ORTAKLIĞI
ANONİM ŞİRKETİ
BALÇIK VILLAGE, GEBZE DISTRICT, KOCAELİ PROVINCE
MAP SECTION G22B14C4B, LOT 177, PARCEL 15
DECEMBER 2015
2015_400_176_04
REAL PROPERTY APPRAISAL
TABLE OF CONTENTS
1.
REPORT DETAILS
3
2.
COMPANY - CUSTOMER DETAILS
3
3.
LEGAL DEFINITION OF REAL PROPERTY AND EXAMINATIONS
4
3.1.
TITLE DEED RECORD DETAILS OF REAL PROPERTY ................................................................ 4
3.2.
ENCUMBRANCE DETAILS OF REAL PROPERTIES ...................................................................... 4
3.3.
CHANGES IN OWNERSHIP RIGHT OF REAL PROPERTIES IN THE LAST THREE YEARS .... 5
3.4.
ENCUMBRANCEDETAILS OF REAL PROPERTIES ....................................................................... 5
3.5.
LEGAL PERMISSIONS AND DOCUMENTS OBTAINED FOR REAL PROPERTIES ................... 7
3.6.
WHETHER LEGAL REQUIREMENTS ARE FULFILLED OR NOT .......................................7
3.7.
CHANGES IN LEGAL STATUS OF REAL PROPERTIES IN THE LAST THREE YEARS
(CHANGES IN ZONING PLAN, CONFISCATION PROCEDURES, ETC.) ............................................... 8
3.8.
WHETHER ANY OBSTACLES EXIST THAT HINDER THE INCLUSION OF THE REAL
PROPERTY/PROJECT IN AN PORTFOLIO OF REAL PROPERTY INVESTMENT PARTNERSHIP
UNDER THE PROVISIONS OF THE CAPITAL MARKET LEGISLATION ................................................. 8
4.
GENERAL DATA AND REGIONAL DATA
9
4.1
DEMOGRAPHIC DATA ......................................................................................... 9
4.1
ECONOMIC DATA .............................................................................................. 10
4.2
REAL PROPERTY INDUSTRY ............................................................................. 16
4.3
REGIONAL DATA............................................................................................... 18
5.
APPRAISAL METHODS
19
6.
LOCATION OF AND PHYSICAL SURVEY ON REAL PROPERTY
21
6.1. LOCATION, ACCESS AND ENVIRONMENTAL CHARACTERISTICS OF REAL PROPERTIES ... 21
6.2
7.
DEFINITION OF REAL PROPERY ............................................................................................... 23
ANALYSIS OF DATA ABOUT REAL PROPERTY AND VALUATION CONCLUSIONS
28
7.1
FACTORS INFLUENCING VALUE OF REAL PROPERTY (SWOT ANALYSIS) ........................ 28
7.2
MOST EFFECTIVE AND EFFICIENT USE ANALYSIS ................................................................ 28
7.3
METHODS APPLIED IN THE APPRAISAL AND REASONS FOR THEM .................................. 28
8.
ASSESSMENT OF THE RESULTS OF ANALYSIS ON REAL PROPERTY
33
8.1 HARMONISATION OF ANALYSIS RESULTS ................................................................................... 33
8.2
9.
WHETHER OBSTACLES EXIST THAT HINDER INCLUSION IN REAL PROPERTY INVESTMENT PARTNERSHIP 34
FINAL VALUE APPRAISAL AND CONCLUSION
2
35
15_400_176_04
1
REPORT DETAILS
REPORT TYPE
:
SCOPE OF REPORT
:
This report is a project appraisal report issued under the “Minimum
Requirements For Contents of Appraisal Report” found in the Capital
Market Board’s Resolution No. 27/781 dated 20.07.2007 pursuant to
Article 34, Paragraph 1, Sub-clause A of Communiqué No III-48.1.
The determination of sales value of the real property “Steel Framework
Agricultural Storage and Manufacturing Storage” registered on Map
Section G22B14C4B, Lot 177, Parcel 15, Balçıklı Village, Gebze District,
Kocaeli Province under the Capital Market Legislation.
DATE AND NUMBER OF SUPPORTING :
AGREEMENT
11.11.2015
APPRAISAL DATE
:
25.12.2015
REPORT DATE
:
31.12.2015
REPORT NO
:
2015_400_176_04
ADVERSE FACTORS ON APPRAISAL
REPORT
:
No adverse factors have been identified that may negatively influence
the appraisal work.
DETAILS OF THE LAST THREE
APPRAISALS CONDUCTED ON
SUBJECT PROPERTY BEFORE THE
DATE OF THIS APPRAISAL REPORT
:
In the real property appraisal report no. 14_400_125_02 dated
31.12.2014 issued previously by our company in relation with the subject
property, a value of 44,000,000 TRY (excl. VAT) is assessed. In
property appraisal report No. 15_400_123_05 dated 5/10/2015, the
property is assessed to have a value of 47,800,000 TRY (exclusive of
VAT).
APPRAISAL METHODS USED
:
Cost analysis and direct income capitalisation methods are used in the
value appraisal. The final value is appraised by harmonising values
calculated with these methods in favour of the value calculated with
cost analysis method.
:
Current Status: 38,500,000.00TRY (Excl. VAT)
In case it is completed: 85,000,000.00TRY (Excl. VAT)
LEASE VALUE APPRAISED
:
In case it is completed: 678,629 TRY/Month (Excl. VAT)
AUTHOR(S)
:
Berkay OKÇUOĞLU
Urban Planner
Appraisal Expert
CMB License No: 402578
SALES VALUE APPRAISED
2
Aysel AKTAN
Urban Planner - Map Engineer
Appraisal Expert In Charge
CMB License No: 400241
COMPANY - CUSTOMER DETAILS
COMPANY TITLE
: HARMONİ GAYRİMENKUL DEĞERLEME VE DANIŞMANLIK A.Ş.
COMPANY ADDRESS
: İdealtepe Mah. Rıfkı Tongsir Cad. Demirhan Plaza No:93/4 -34841
Maltepe / ISTANBUL
Phone: +90 (216) 388 05 09 Fax: +90 (212) 258 78 84
www.harmonigd.com.tre-mail: [email protected]
CUSTOMER TITLE
: Saf Gayrimenkul Yatırım Ortaklığı Anonim Şirketi
CUSTOMER ADDRESS
: Acıbadem Mahallesi, Ankara Devlet Yolu, Haydarpaşa Yönü 4.km, Çeçen Sokak,
34660, Üsküdar/İSTANBUL
: Request of Customer; the determination of sales value of the real property “Steel
Framework Agricultural Storage and Manufacturing Storage” registered on Map
Section G22B14C4B, Lot 177, Parcel 15, Balçıklı Village, Gebze District, Kocaeli
Province under the Capital Market Legislation and no limitation is applied.
SCOPE OF CUSTOMER
ORDER AND
RESTRICTIONS APPLIED
3
15_400_176_04
3.
LEGAL DEFINITION OF REAL PROPERTY AND EXAMINATIONS
Title Deed Records of Real Properties, Zoning Status, and Details of the Last Three Years
The subject property is the real property “Steel Framework Agricultural Storage and Manufacturing
Storage” with an area of 69,907.47m2, registered at Map Section G22B14C4B, Lot 177, Parcel 15,
Balçıklı Village, Gebze District, Kocaeli Province. Detailed information about the property will be defined
in the sub-sections.
3.1.
Details about Title Deed Records of the Property
Details about title deed records of the subject property are provided in the following table.
Table. 1 Title Deed Details about Subject Property
MAIN PROPERTY TITLE DEED DETAILS
PROVINCE
: KOCAELİ
DISTRICT
: GEBZE
NEIGHBOURHOOD/ VILLAGE
: BALÇIK VİLLAGE
LOCATION
: -
MAP SECTION NO.
: G22B14C4B
LOT NO.
: 177
PARCEL NO.
: 15
SURFACE AREA
: 69,907.47m²
FEATURE
: STEEL FRAMEWORK AGRICULTURAL STORAGE AND MANUFACTURING STORAGE
VOLUME/PAGE NO.
:
29/2844
JOURNAL NO.
:
11520
TITLE DEED DATE
:
08.29.2012
OWNERS/SHARE RATIO
:
SAF GAYRİMENKUL YATIRIM ORTAKLIĞI ANONİM ŞİRKETİ / FULL
3.2 Encumbrance Details of Property
On the basis of the TAKBIS (Title Deed Info System) document retrieved from the Title Deed
Information System, the encumbrance details about the property are as follows. The encumbrance
document dated 7/12/2015 is provided in the report annexes.
Servitude Field:
-
H: Servitude Right in favour of ETİBANK General Directorate to the 5,488m2 part indicated in
the plan: with the date of 11.02.1964 and journal no. 125. OWNER: Etibank A.Ş.
-
Servitude Right in favour of TEAŞ to the 3.946m² part indicated in the plan: with the date of
05.11.1997 and journal no. 5831. OWNER: Türkiye Elektrik İletim Üretim A.Ş.
-
Servitude Right in favour of TEAŞ to the 894m² part indicated in the plan: with the date of
18.02.1999 and journal no. 959. OWNER: Türkiye Elektrik İletim Üretim A.Ş.
Statements:
-
Financial leasing in favour of Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş. with date 16.09.2008
and journal no. 13777.
-
A building under risk pursuant to Law No. 6306. Y.K. No.: 93270: Date 20/10/2015, journal no.
20216.
-
A building under risk pursuant to Law No. 6306. Y.K. No.: 93252: Date 20/10/2015, journal no.
20241.
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15_400_176_04
3.3
Changes in Ownership Right of Real Property in the Last Three Years
The subject property, which was registered to the name of FFK Fon Finansal Kiralama A.Ş. was
registered to the name of Saf Gayrimenkul Yatırım Ortaklığı A.Ş. on 29/08/2012 and no ownership
changes have been recorded since said date.
3.4
Zoning Details of Property
According to the document no. 303752 dated 9/12/2015 of Gebze Municipality Plan and Project
Directorate, the subject property registered at Section G22B14C4B, lot 177, parcel 15 (the subject
property’s parcel no. which was previously 4 was changed to 15) is located in “Industrial” zone with
E:0,80 construction under the right of the Northern Gebze Highway Application Zoning Plan, scale
1/1000, (PIN:UIP-315) approved with decision no. 190 dated 13.3.2014 of Kocaeli Metropolitan
Municipality Council. The zoning status document is provided in the annexes.
Since a power transmission line passes above the parcel, the approval of TEİAŞ General Directorate
must be taken in case a new construction is planned on the parcel. It is confirmed on the document in
its file that the approval of said authorities has been obtained for the current buildings (document no.
3151 dated 15.12.2010 of TEİAŞ General Directorate). In the communication dated 24/11/2015
between SAF GYO and Gebze Municipality with regards to the project newly on the parcel, it was
declared that construction activities would commence per its license after the completion of the power
transmission line displacement application according to the displacement project of TEİAŞ No.
47126947-755.01-E.106734 dated 04/11/2015. According to TEİAŞ’ letter dated 04/11/2015, pursuant
to SAF GYO AŞ’letter dated 15/07/2013, the project of displacement work between 36-38 poles of
154Kv (Kromançelik-Gebze) Brş. N-Ova Electricity P.T. Line was approved on 30/10/2013 and then reapproved by the displacement project authority due to the location of facilities newly built on the parcel
as well as amendment in zoning. Therefore, it does not cause any construction on the subject parcel.
Said document is provided in the annexes.
According to verbal information from Gebze Municipality Plan and Project Directorate, a Zoning
Application (partion- Article 18 Application) shall be conducted in the region of the subject parcel.
Currently there is no issue of parcel abandonment, the net area may change after the zoning
application planned to begin in the following months.
Application of Article 18:
“Municipalities are, without confirmation of owners and other right-holders of lands with or without buildings
located within the zoning boundary, authorised to combine them with each other, with excess roads, with
locations owned by public agencies or municipalities, re-divide them into islands or parcels appropriate to the
zoning plan, distribute them to the right-holders on individual, shared, or flat ownership principles and register
them ex-officio. In case said locations are outside the municipality and urban area, then said authorities shall
be used by governors.
During the distribution of lands subject to regulation by municipalities or governorship, the sufficient pieces of
fields may be reduced in the form of “Regulation Partnership Share” in consideration of revaluations occurring
due to regulations. However, regulation partnership shares to be determined as to this article shall not exceed
40% of the pre-regulation surface areas of lands subject to regulation.
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TECHNICAL
INFRASTRUCTURE AREA
HEALTH FACILITY
AREA
WHOLESALE TRADE
PARK
INDUSTRY
INDUSTRIAL AREA
PRAYER AREA
(Mosque)
INDUSTRIAL AREA
GK 30th REGION
STORAGE AREA
STORAGE AREA
PARK
Zoning Plan Copy
6
15_400_176_04
3.5
Legal Permissions and Documents Obtained for Real Property
Information about whether all required permissions for the subject projects pursuant to the applicable legislation have been
obtained or not; whether its project exists and is approved or not; whether all documents legally required for initiation of the
construction are available or not; about audits conducted on the subject property by the construction audit firm (title, address,
etc.) that conducted said audit pursuant to Construction Audit Code No. 4708 dated 6/29/2001;
The archival file of the subject project in the Zoning Archive of Arnavutköy Municipality was examined on
04/12/2015. Current structures on the subject parcel were announced as buildings under risk pursuant to Law No.
6306 on 20/10/2015. New Building Licenses dated 27/11/2015 in Block A and B were issued for the subject parcel.
There are available New Building Licenses dated 27/11/2015 and numbered 1005 for Block A, and dated
27/11/2015 and numbered 1006 for Block B and the approved architectural project with the same date was
examined in the municipal archive file.
As indicated in our report dated 15_400_123_05, among the current buildings on the parcel, Block A is without
zoning and Block B is with zoning.
The permission for demolishing Block A on the parcel has been obtained from the Capital Market Board with the
deadline 19/02/2016 and the letter dated 02/03/2015 of the Capital Market Board Presidency is presented in the
annexes section of the report. Two blocks will be demolished and refurbished as per the new factory project
developed on the parcel, details of which are provided in Article 6.2 of the report and licenses of which are issued.
Table. 2 New Building License Details of Subject Real Property
BUILDING LICENSES
BLOCK A
ISSUED
FOR
NEW
BUILDING
LICENSE
DATE
27/11/2015
LICENSE
NO.
1005
FUNCTION
BUILDING
CLASS
NUMBER OF
FLOORS BELOW
ROAD ELEVATION
NUMBER OF
FLOORS
ABOVE ROAD
ELEVATION
TOTAL
NUMBER
OF FLOORS
SURFACE
AREA (m2)
Industrial Buildings
4A
4
2
6
26,538.00
Garage Buildings
-
-
-
-
21,388.00
Common Area
-
-
-
-
TOTAL
16,139.00
64,065.00
BUILDING LICENSES
BLOCK B
ISSUED FOR LICENSE DATE
NEW
BUILDING
27/11/2015
LICENSE
NO.
1006
FUNCTION
NUMBER OF
BUILDING FLOORS BELOW
CLASS
ROAD
ELEVATION
SURFACE
AREA (m2)
Industrial Buildings
4A
4
2
6
47,598.00
Garage Buildings
-
-
-
-
8,182.00
Common Area
-
-
-
-
TOTAL
3.6.
NUMBER OF
TOTAL
FLOORS
NUMBER
ABOVE ROAD
OF FLOORS
ELEVATION
15,851.00
71,631.00
Whether Legal Requirements are Fulfilled or not
Opinion about whether legal requirements are fulfilled or not and whether the legally mandatory license and documents are full
and complete.
With regards to the subject parcel “New Building Licenses” were issued for Block A with No. 1005 dated 27/11/2015
and for Block B with No. 1006, dated 27/11/2015. In the examination as of the appraisal date it is seen that the
structures exist that are declared to be “under risk” pursuant to Law No. 6306 on 20/10/2015. In the letter dated
02/03/2015 of the Capital Market Board Presidency, it is stated that it resolved to grant one year for the evacuation
of Rozi Factory Building, which currently does not have a building occupation permit for Block A, for obtaining its
demolition license, for its demolition, and for the re-inclusion of it in the REIT portfolio with land quality and
restoring its compliance with the legislation.
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Following the completion of the new project construction after the demolishment of the current
buildings in the period stated in the letter dated 02.03.2015 of the Capital Market Board Presidency, the
legislative procedure will be completed after the building Occupation Permit Certificates are issued and
type allocation is completed.
3.7
Changes in Legal Status of Real Property in the Last Three Years (Changes in
Zoning Plan, Confiscation Procedures, Etc.)
While according to the applicable zoning plan of Kocaeli Metropolitan Municipality Council approved with
resolution no. 950 dated 12/7/2005, the subject property on parcel 15, lot 177, map section
G22B14C4B, Balçık Village, Gebze District, Kocaeli Province remained in the “Industrial” zone with
precedent:0.75 construction condition, it is regulated as an “industrial” zone with construction condition
precedent:0.80 under the Northern Gebze Highway Application Zoning Plan with scale 1/1000 approved
with the resolution of Kocaeli Metropolitan Municipality Council no. 190 and dated (PIN:UIP-351)
13/3/2014.
3.8
Whether any Obstacles Exist that Hinder Inclusion of Real Property/Project in a
Portfolio of Real Property Investment Partnership under the Provisions of Capital
Market Legislation
Opinion about whether any encumbrances are imposed on the subject property (any limitations on its transferability), if so, then
whether it prevents the subject property from being included in a Portfolio of Real Property Investment Partnerships under the
provisions of the Capital Market Legislation
In an examination of Title Deed Registry, it is seen that it has a financial leasing annotation in the title deed in
favour of Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş. with the leasing agreement executed by FFK Fon Finansal
Kiralama A.Ş.
With the Management Resolution dated July 1, 2011 of Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş. a merger of
Gayrimenkul Geliştirme İnşaat ve Ticaret A.Ş. through its take-over by Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş. as
a whole together with its assets and liabilities was resolved upon. The company mergerwas approved on the Capital
Market Board meeting no. 31/887 dated September 23, 2011. The merger resolution was then adopted in the
Extraordinary General Assembly Meeting held on October 31, 2011 by Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş. and
Saf Gayrimenkul Geliştirme İnşaat ve Ticaret. During the said merger process, Article 2 of the Sağlam Gayrimenkul
Yatırım Ortaklığı A.Ş. ’Articles of Association was amended and accordingly company the title was changed as Saf
Gayrimenkul Yatırım Ortaklığı A.Ş.
The financial leasing phrase “in favour of Sağlam Gayrimenkul Yatırım Ortaklığı A.Ş.” dated 16.09.2008 stated in the
statements field of the encumbrance records for the subject property became null and void upon the transfer of the
property into the ownership of Saf Gayrimenkul Yatırım Ortaklığı A.Ş. on 29.08.2012.
The servitude rights on the property in favour of ETİBANK and TEAŞ do not restrict the purchase-sales transactions
of the property, since it is related with the Power Transmission Line passing over the parcel. Construction can only
be performed upon the receipt of the opinion of the relevant authority in terms of zoning legislation (by taking into
account the Power Transmission Line approach distances). The issue is taken into account in the appraisal under
the provisions stated in Article 22 (1) (c) and (j) of the Communiqué of Principles of Real Estate Investment
Partnerships and it is concluded that there are no hindrances against the inclusion of the subject property in a
portfolio of the Real Property Investment Partnership under the provisions of the Capital Market Legislation.
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With the letter dated 02.03.2015 of the Capital Market Board Presidency issued for Block A located on the subject
parcel being in conflict with zoning legislation, one year is allowed for restoring them to comply with the zoning
legislation. The subject property is declared to be a building under risk pursuant to Law No. 6306 on 20/10/2015.
The architectural project dated 27/11/2015 has been approved and two separate New Building Licenseshave been
issued for Block A and B. It is considered that the current buildings on the subject property registered under the
“Buildings” title of SAF Gayrimenkul Yatırım Ortaklığı pursuant to the provisions of Capital Market Legislation will be
demolished construction works beginning pursuant to the New Building License dated 27/11/2015. It is concluded
that there is no issue with the buildings included in the portfolio remaining under the “Buildings” title of the
Portfolio of Real Estate Investment Partnership pursuant to the Capital Market Legislation provisions until
19.02.2016.
4
4.1
GENERAL DATA AND REGIONAL DATA
Demographic Data
As per the data retrieved from the Address-Based Population Registry System (ADNKS) updated as of December
31, 2014 by the Ministry of Internal Affairs Population and Citizenship Affairs General Directorate (NVİGM), the
Turkish population is recorded as 77,695,904 people. The Turkish population grew in 2014 by 1,028,040
compared to the previous year. The male population makes up 50.2% of the population (38,984,302 people)
and the female population constitutes 49.8% (38,711,602 people). The population growth rate of Turkey slowed
down in 2014 to 13.3% compared with 13.7% in 2013.
The rate of residents in cities and town centres rose to 91.8% in 2014 compared to 91.3% in 2013. The rate of
village inhabitants is recorded as 8.2% as of 2014. Istanbul, which houses 18.5% of the Turkish Population is
recorded as the city with the highest population with its 14,377,018 residents. This is followed by Ankara with
6.6% (5,150,072 residents), Izmir with 5.3% (4,113,072 residents), Bursa with 3.6% (2,787,589 residents) and
Antalya with 2.9% (2,222,562 residents). With 80,607 residents, Bayburt is the city with the lowest population.
Chart 1 Population Pyramid
Population pyramid, 2014
Age group
Male
Female
In Turkey, the rate of the population in the 15-64 age group (employment age) grew to 67.8% (52,640,512
people) in 2014, a growth of 0.1% when compared to 2013 (67.7%). While the infant population (0-4 years of
age) reduced to 24.3% (18,862,430 people), the rate of the population in the 65+ age group rose to 8%
(6,192,962 people). In Turkey the number of persons per kilometre, termed as Population Density, is recorded
as 101 persons in 2014, a 1 person increase compared to 2013. Istanbul is the city with the highest population
density with its 2,767 residents per kilometer, followed by Kocaeli with 477 residents, Izmir with 342 residents,
Gaziantep with 277 residents, and Bursa and Yalova with 267 residents. The city with the lowest population
density is Tunceli with 12 residents per kilometer. Konya, which has the largest area, has a population density of
54 residents per kilometer and Yalova, which has the smallest area, of 267 residents.
(Source: TUIK 2014 year-end results)
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4.1
Economic Data
4.1.1. Global Economic Outlook
Global economic developments still remain important in terms of financial stability. While the USA
demonstrates a stronger growth performance than other developed countries, poor levels of economic
growth still remain in the Euro Zone. As the driver of global growth, developing countries are recording a
slower growth rate. Inflation is still below the targets in developed countries and is moving upwards in
developing countries. Uncertainties around the normalisation process in monetary policy, as well as the
interest rate hike signals of the US result in a high level of sensitivity of global markets to data flow. In
such a conjecture, the US Dollar demonstrated a build-up against other currencies and capital movements
indicated fluctuating behaviour in developing countries. (CBRT, Financial Stability Report, May, 2015).
The Global Economic Outlook Report issued in January 2015 by the International Monetary Fund (IMF)
indicated that the global economy has grown by 3.5%. However, it highlighted the differences among the
growth rates of advanced economies. In this respect, it is noted that while the United States of America
(USA) achieved a growth figure over the odds, Japan could not reach the expected growth rates.
Underperformance of developed countries such as Japan is associated with the lower levels of economic
performance in the mid-term.
Another factor affecting economic segregation among the developed countries is, as reported, the
revaluation of the US Dollar at levels of 6% since September 2014 and the devaluation of the Euro, the
common currency of the EU, to levels of 2%, and the devaluation of the Japanese Yen to levels of 8%.
Likewise, in developing countries, their currencies are devalued due to decreases in their export figures.
Interest rates and risk premiums are also increasing because of the economic uncertainties. Particularly,
there are decreases in the investment tools that gained value dependant on oil. The recovery and growth
rate of the US economy are predicted by the IMF to be 3% during 2015 and 2016. Economic expectations
in 2014 are considered as positive thanks to the revaluation of the US Dollar and decreasing rates of
unemployment. However, with the revaluation of the US Dollar, it is forecasted that the US’ export figures
will decrease.
Table. 3 IMF’s World Economy Growth Forecasts
IMF (International Monetary Fund) 2014 Gross Domestic Product figures and 2015-2016
GDP Growth Forecasts
2014
(%)
2015
(%)
2016
(%)
World Average
3.3
3.5
3.7
Developed Country Average
1.8
2.4
2.4
USA
2.4
3.6
3.3
Euro Zone Average
0.8
1.2
1.4
Japan
0.1
0.6
0.8
UK
2.7
2.6
2.4
Canada
2.4
2.3
2.1
Developing Country Average
4.4
4.3
4.7
Russia
0.6
-3
-1
Asia
6.5
6.4
6.2
China
7.4
6.8
6.3
India
5.8
6.3
6.5
South America and Caribbean
1.2
1.3
2.3
Brazil
0.1
0.3
1.5
Mexico
2.1
3.3
3.5
Middle East, North Africa, Afghanistan, and Pakistan
2.8
3.3
3.9
Sub-Saharan Africa
4.8
4.9
5.2
Nigeria
6.1
4.8
5.2
South Africa
1.4
2.1
2.5
Source: World Economic Outlook Report, IMF (October, 2014)
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The global economy in 2014 was characterised by long-term economic stagnation after the 2008 crisis,
increase in unemployment rates and limited growth. Political risks emerged in the Middle East and political
tensions emerged between Russia and Ukraine. Similar risks are predicted to continue in 2015 and 2016,
as well. In addition, declining oil prices also pose a risk to the global economy. It is highlighted that while
declining oil prices may open the way for an increase in industrial production, significant global economic
constrictions may occur in the event that OPEC countries restrict the supply in order to stop declining
prices. This uncertainty faces producers and investors with a risk. Therefore, it causes macroeconomic
uncertainties. Another consequence of uncertainties is the fluctuations in the global finance markets. The
revalued US Dollar and devalued currencies of developing countries against the US Dollar also bring serious
inflation risks for these countries. Moreover, the decision adopted by the USA to normalise its monetary
policy signalled that it will shift towards a more strict financial and monetary policy. Therefore, the IMF
predicts that revaluation of the US Dollar will continue during 2015 and 2016, and this has proven correct
so far.
Lower levels of inflation prevailing in the Euro Zone and Japan so far is also considered by the IMF as an
indicator of economic stagnation. As a result, it is indicated that the Euro Zone and Japan have become
more susceptible to external shocks. Lastly, IMF summarised the common problems for developed
countries as production gaps (declining production figures after the 2008 crisis), inflation rates remaining
below target, inflation rates remaining above target for developing countries, insufficient macroeconomic
capacity for implementing the necessary macroeconomic policies, higher inflation risks due to declining oil
producing countries, and as a result of all these, the vulnerability against external shocks. The general
outlook of the economy indicates structural economic and financial problems. In this respect, it is
necessary to implement structural reforms in order to eliminate the problems.
4.1.2. Economic Outlook in Turkey
Indicators of the first quarter of 2015 pointed to a certain amount of momentum loss due to the
deceleration of foreign demand. Following the second quarter, it is estimated that economic activities will
be restored to a moderately increasing trend with the partial recovery of European Union growth. In a
close-up of the inflation outlook, it is observed that cautious monetary and financial policies, as well as
macro preventive measurements have impacted the core inflation indicators positively and low levels of
goods prices support the declining inflation rate. However, higher increasing levels of food prices and
developments in the foreign exchange rate in the first quarter caused improvements in the inflation to be
more limited than expected.In this framework, the CBRT retained its cautious stance on monetary policy.
With current account balances improving, the on-going financial discipline contributes significantly to
decreasing both risk premiums and inflation. While the CBRT retained its cautious stance on monetary
policy, it aimed at decreasing macro financial risks with measurements that support the currency liquidity,
core obligations, and long-term borrowing.
Thanks to macro-preventive measurements adopted, an improvement in the ratio of household financial
liabilities to assets continues. Households borrowing solely in Turkish Liras and fixed interest rates
contribute to preserving the solvency of households in this period of increasing financial market volatility.
In the loan demand of real industry, it is seen that the financing of Turkish Lira operating capital and the
need for replenishment of current debts are determent. The heavy long-term nature of real industry
currency debts, low levels of short-term open positions, and the fact that large companies can better
manage the currency risk engage in foreign currency borrowing are found to be restrictive factors of
currency risk. In addition, the tax incentive to the cash capital increase, which is provided by the new legal
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regulations enacted in order to decrease high leverage caused by tax advantages of financing through
borrowing, will encourage equity financing.
While the loan growth rates of the banking industry fluctuate at reasonable levels, the higher
increasing level of business loans than consumer loans thanks to adopted measures supports a
balanced growth. While the rate of non-performing loans of banks are at constant levels, factors such
as poor economic activity and currency volatility require monitoring of the loan risk. It is observed
that current capital buffers are at levels allowing the mitigation of credit risk losses. The banking
industry continues to have its solid liquidity outlook.
As a result of evaluations, schematic implications of developments with regards to financial stability
in Turkey are provided in the following macro table. Accordingly, in the last six months, global
markets, domestic economy, and domestic financial market developments remain poorer than the
previous six months.
(CBRT, Financial Stability Report, May, 2015).
Global Economy
Global Markets
Banking
Household
Domestic
Economy
Companies
Domestic
Markets
Public Sector
Balance of Payments
Source: CBRT Financial Stability Report (May, 2015)
Table. 4 Growth Forecasts of International Organisations for Some Country Groups
ORGANISATION
YEAR
Growth Forecasts For Some Countries - Country Groups (%)
World
Turkey
Euro Zone
USA
Brazil
Russia
India
China
2015
3.3
3.1
1.5
2.5
-1.5
-3.4
7.5
6.8
2016
3.8
3.6
1.7
3.0
0.7
0.2
7.5
6.3
2015
3.1
3.1
1.4
2.0
-0.8
-3.1
6.9
6.8
2016
3.8
3.9
2.1
2.8
1.1
0.8
7.6
6.7
2015
2.8
3.0
1.5
2.7
-1.3
-2.9
7.5
7.1
2016
3.3
3.9
1.8
2.8
Source: Ministry of Economy Economic Outlook (July, 2015)
1.1
0.1
7.9
7.0
IMF
OECD
DB
In the economic outlook report of the Ministry of Economy, International Organisations estimated the
2015 growth of Turkey as 3%.
International projections still demonstrate cautious forecasts and predict a slowed down Turkish
Economy. While the IMF and OECD forecast a GDP growth for Turkey at rates of 3.1% and 3.2%, the
World Bank forecasts it to be at the rate of 3.5% (Ministry of Economy Economic Outlook May 2015).
The economic outlook report of the IMF forecasts that Turkey’s GDP growth will result from declining
energy imports and subsequently declining energy prices.
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Table. 5 IMF Economic Outlook Report (April 2015) - Real GDP - Consumer Prices - Current
Account Balance - Unemployment
Source:World Economic Outlook Report, IMF (October, 2014)
The IMF’s World Economic Outlook Report, April 2015, made forecasts on Real Gross Domestic Product,
consumer prices, current account balances, and unemployment for the years 2015 and 2016 in European
Countries. The IMF forecasts that Turkey’s economic growth will be 2.9% in 2014, 3.1% in 2015, and
3.6% in 2016. In the report, the IMF’s 6% forecast of current account/national income ratio for 2016 is
revised as 4.8% due to the declining oil prices. The unemployment rate in Turkey is forecasted to rise up
to 11.4% in 2015 and 11.6% in 2016.
The report observed that the economic growth of Turkey and Eastern Europe was slowed down last year,
but that Hungary and Poland sustained their current growth.
The Current Account balance rate recorded in the World Bank database and indicated in the IMF’s report
show parallels. (The World Bank’s Current Account balance rate forecasts, -5.6 in 2014; -4.5 in 2015; 4.9
in 2016). Likewise, the GDP forecasts published in the OECD database and those indicated in the IMF’s
report show parallels.
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Table. 5 Table 6 OECD Real Gross Domestic Product Forecasts
Source: https://data.oecd.org/gdp/real-gdp-forecast.htm#indicator-chart
4.1.2.1. Growth Rates in Turkey
Turkey is one of the countries that has rapidly recovered from the global economic crisis and was one of those
relatively less affected by the global economic uncertainty of recent years. While the annual growth rate was
recorded as 5.2% in the period 2002-2012, our country recorded a 4% growth rate in 2013. On the official
website of the Turkish statistics agency’s 2014 Q4 GDP rates: GDP was calculated by production method as
126,070,000,000 TRY in fixed prices with an increase of 2.9% in 2014 compared to the previous year, and as
1,749,782,000,000 TRY in current prices with an increase of 11.6%. In fixed prices it reachedup to
30,089,000,000 TRY in the first quarter of 2015 with an increase of 2.3% compared to the same quarter of
2014.
In current prices it reached 443,189,000,000 TRY in the first quarter of 2015 with an increase of 7.8%
compared to the same quarter of previous year.
The total added value of the agricultural industry was recorded as 1,390,000,000 TRY in fixed prices in the first
quarter of 2015 with an increase of 2.7% in 2015 compared to the same quarter of the previous year and
17,458,000,000 TRY in current prices with an increase of 17%.
The total added value of the industrial activities remained the same in the first quarter of 2015 compared to
the same quarter of the previous year and reached 106,192,000,000 TRY in current prices with an increase of
3%. The total added value of the service industry was recorded as 18,873,000,000 TRY in fixed prices in the
first quarter of 2015 with an increase of 4.1% in 2015 compared to the same quarter of the previous year and
268,473,000,000 TRY in current prices with an increase of 9%.
While GDP estimates based on calendar adjusted fixed prices rose to 2.4% in the first quarter of 2015
compared to the same quarter of the previous year, the calendar and seasonally adjusted GDP value was
recorded as 1.3% compared to the previous quarter.
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Gross Domestic Product Results, First Quarter: January-March, 2015
In Current Prices
Growth
Rate
In Current Prices
GDP
Growth
Rate
In Fixed Prices
GDP
Growth Rate
GDP
Year
Quarter
(Million TRY)
(%)
(Million $)
(%)
(Million TRY)
(%)
2014
Annual
1 749 782
11.6
800107
-2.8
126070
2.9
2015
First
411 255
15.6
185 961
-6.6
29 413
4.9
Second
428 259
10.6
202 407
-4.0
30 907
2.3
Third
463 902
11.0
214 751
0.8
33 645
1.9
Fourth
446 366
9.8
196 989
-1.5
32 104
2.6
443 189
7.8
180 506
-2.9
30 089
2.3
Annual
First
Figures in the table may not produce exact sum due to rounding.
Source: www.tuik.gov.tr
Final consumptions of households were recorded as 316,311,000,00 TRY in current prices in the first
quarter of 2015 by an increase of 11.1% compared to the same quarter of the previous year and
20,982,000,000 TRY in fixed prices with an increase of 4.5%.
Final consumptions of the government were recorded as 66,891,000,000 TRY in current prices in the first
quarter of 2015 by an increase of 7.9% compared to the same quarter of the previous year and
3,211,000,000 TRY in fixed prices with an increase of 2.5%.
Gross fixed capital formation was recorded in current prices as 90,929,000,000 TRY in the first quarter of
2015 with an increase of 4.6% compared to the same quarter of previous year.
Goods and service exports were recorded as 117,695,000,000 TRY in current prices in the first quarter of
2015 by an increase of 2.3% compared to the same quarter of the previous year and 7,858,000,000 TRY
in fixed prices with a decrease of 0.3%.
Goods and service imports were recorded as 136,795,000,000 TRY in current prices in the first quarter of
2015 by an increase of 1.8% compared to the same quarter of the previous year and 8,703,000,000 TRY
in fixed prices with an increase of 4.1%.
GDP Growth Rates with Expenditures Method. First Quarter: January-March, 2015 [1998 Prices]
Final
Final
Gross
Consumption
Consumption
Fixed
Expenditures of
Expenditures
Capital
Households of Government Formation
(%)
(%)
(%)
Gross Fixed
Capital
Formation
(%)
(less) Good
and Service
Import
(%)
-0.2
Year
Quarter
2014
Annual
1.3
4.6
-1.3
6.8
2015
First
2.6
9.2
-0.3
11.1
0.7
Second
0.4
2.5
-3.5
5.5
-4.3
Third
0.1
6.6
-0.4
7.9
-1.6
Fourth
2.4
1.7
-1.0
3.4
4.6
4.5
2.5
0.0
-0.3
4.1
Annual
First
Source: www.tuik.gov.tr
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4.2
Real Estate Industry
The results of the 2015 thorough survey “Emerging Trends in Real Estate Europe” issued in collaboration with PwC and
the Urban Land Institute state that residence and office markets in Turkey have been affected by the developments in
Syria and Iraq, however, the political risks due to uncertainties related to the non-election of a Prime Minister and
Cabinet declined after the Presidential Election in August.
This survey report also stated that Turkey is experiencing a process of stagnation due to the political developments of its
neighbour Syria, and a general slowdown in its economy. The same report also surveyed Turkish borrowing expectations
for the year 2015, which resulted in 50% of respondents expecting that Turkey will remain stable, 33% expecting lesser
amounts of borrowing, and 17% expecting higher amounts of borrowing.
Chart 2 Europe 2015 Borrowing Expectations.
Source: Emerging Trends Europe Survey 2015 Research Report
According to the Turkish Real Estate Market Outlook Report published in February 2014 by American firm Jones
Lang LaSalle, one of leading real estate services and financial management companies in the world;
•
One of the factors that determined the direction of the Turkish economy in 2014 was the heavy political
agenda due to regional disturbances such as terrorist activities spreading over the Middle East and
Europe, coupled with the Ukrainian crisis, in addition to Mayoral and Presidential Elections.
•
Exchange rates gained a more stable outlook from the Mayoral elections to the end of the third quarter,
2014. However in the fourth quarter, Turkish Liras (TRY) were devalued against the US Dollar (USD)
and the Euro (EUR).
•
Declining import volumes coupled with the sharp decline in oil prices mainly lead to a decline in the
current deficit in the final quarter of 2014. A more competitive exchange rate is expected to have a
positive impact on Turkey’s export volume, which is adversely affected by regional conflicts. It is
predicted that the political agenda will remain one of the primary risk factors for Turkey in 2015, which
will be aggravated by the general elections and ongoing regional conflicts.
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Table. 7 Exchange Rate Changes
Jan 14
Feb
- 14
Mar
- 14
Apr14
May
- 14
Jun 14
Jul 14
Aug14
Sep14
Oct14
Nov14
Dec14
Source: CBRT
Source: Turkish Commercial Real Estate Market Outlook (February 2015)
Political uncertainty arising from Presidential Elections restricted the interest of international investors in 2014.
Nevertheless, local investors are observed to have a strong appetite for project development and investment.
Office investments remained buoyant during the year, particularly investments towards current and developing
office projects for use of owners remained strong.
According to the “Emerging Trends in Real Estate Europe 2015 Report” published in collaboration of PwC and
the Urban Land Institute (ULI), which reports the latest developments in the real estate industry, Istanbul with
its current real property investments ranked 20 among 28 cities in Europe that attract investment in the real
estate industry. The report stressed that student housing, particularly in Ortaköy and Büyükçekmece District,
however small a market, gained importance.
Table. 8 Investments in Istanbul
Source: Emerging Trends in Real Estate Europe 2015
The report assumed Istanbul’s population to be 20 million and its employed population to be 7 million. The net
income per capita is calculated as €35. The table shows the investments in Istanbul and an expectation for a
decline in 2015.
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4.3
Regional Data
One of most important elements determining the value of subject properties are the characteristics of the region
in which it is located. Therefore, geographical position, land structure, socio-economic features, the development
direction of the region where the subject properties are situated are factors that affects the appraisal work and
general information about the regional data are provided in sub-sections.
4.3.1. Kocaeli province
Geographical Location:
Kocaeli is situated to the south of the Sea of Marmara,
interconnecting Asia and Europe and the Marmara Region.
Sakarya is situated to the east and southeast of the
province, Bursa to the south, Istanbul and Yalova to the
west, and the Black Sea to the north.
With an area of approximately 3,505 km2, Kocaeli is
dominantly located along the Samanlı Mountains, İzmit,
Sapanca, and Adapazarı depression site starting from the west bank of the River Sakarya through Pamukova and
the north of Lake İznik to Bozburun. The main lowlands are plains stretching between Kocaeli Province, Lake
Sapanca, and Dilovası plain. Being a pen plain, Kocaleli Peninsula’s section remaining in the city boundaries are
undulating plains.
Transportation: Kocaeli has been an important centre of attraction throughout history thanks its close proximity
to the Metropolis of Istanbul, its natural harbour (the Gulf of İzmit), forests, as well as significant advantages in
land, sea, and railway transportation. With its land, rail, sea, and air transportation, it is one of the most important
transit points in Turkey. Kocaeli is 342km from thecapital city Ankara and 111 km from Istanbul. Its distance from
Iğdır (Dilucu Border Gate), the easternmost city of Turkey, is 1,404 km and it is 341kmfrom Edirne (Kapıkule
Border Gate) Turkey’s westernmost city.
Population: According to the Address-Based Census System, in 2014, Kocaeli had a total population of 1,722,795.
4.3.2. Gebze District
Geographical Location:
Gebze is a district in Kocaeli. It is one of the largest industrialised districts
of the Marmara Region. The oldest known part of the Bithynia Region, in
which Gebze is located, dates back to the 12th century BC. As an
important transit point between the continents of Asia and Europe, the
Kocaeli Peninsula is known to have been a hometown or transit point for
many nations or a place where they left their mark. Within the district
now known as Gebze were the settlements of Dakibyza and Libyssa
during the Bithynia Kingdom period, under the reign of King Nicomedes I
from 281-246 BC. These settlements have attracted the attention of historians mostly because Hannibal the famous
commander of Carthage settled there during his reign. Following his defeat in the Battle of Zama, Hannibal fell
from grace and had to take refuge in the Bithynia Kingdom. The tomb of Hannibal lies in Tübitak Campus in Gebze.
Turkey is categorized into five groups in terms of economic development levels. Level 1 Advanced cities are
Istanbul, Ankara, Izmir, Bursa, and Kocaeli. In this respect, Gebze is located in one of the five most advanced cities
of Turkey. According to the Address-Based Population Census System, in 2014, Gebze had a total population of
338,412.
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5
APPRAISAL METHODS
Information about appraisal methods used and the reasons why these methods were chosen
Valuation is performed on the basis of market value or non-market values of an asset. The market,
price, cost, and value concepts lie at the core of all valuations. Another factor that is equally important
in terms of valuation is the clear description of how the valuation results are obtained.
5.1
Price, Cost and Value
Price is a sum that is demanded, offered, or paid for a good. The paid-up price represents the point
where supply and demand intersect. Value means the potential price on which a buyer and seller
may agree for a good or service offered to the market for purchasing purposes.
Cost, which is a production-related concept, is defined as the necessary sum required for creating or
producing a good, merchandise, or service, other than the exchange transaction.
While value is associated with the sale or barter of a good or service during a certain period of time,
instead of being real, cost is a potential price assessment to be paid for the production expenses of
goods and services.
Owners, investors, insurers, value-assessors, grading experts, liquidation officers, trustees, bidders,
or special purchasers above the normal may each attribute different values to the same property on
the basis of rationally equal and valid reasons.
5.2.
Market and Non-Market Based Value
Basically, a value is created and maintained on the basis of the interaction of four factors related to any product,
service, or good. These factors are benefit, shortage, want, and purchasing power.
•
Market value is an estimated amount of real estate that must be transferred on the date of valuation
under an agreement in which parties act as informed, prudently, and in a good manner, under conditions in
which parties will not be affected due to any kind of relations and without any coercion between the willing
buyer and the willing seller who are independent of each other after an appropriate negotiation.
•
Market Value is the estimated value of a property without taking into account its sales or purchasing costs
or any tax assessments.
•
In order to estimate market value, an appraisal expert must firstly determine the most efficient and the best
use or most likely use. This use may be the current use of property as well as other alternative uses on the
basis of market findings.
Among the most applied approaches for market value estimations are the benchmarking approach, income
discounting approach, which also include discounted cast flow, and cost approach.
5.2.1. Benchmarking approach
This benchmarking approach assesses value on the basis of comparison by taking into account sales and market
data of similar or substitute properties. In general, the property being appraised is compared with the sales of
similar properties transacted in the free market and also by considering offered prices and offered proposals.
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5.2.2. Income discounting approach
In this approach, value estimation is calculated through the discounting method by taking into account the
income and expenditure data pertaining to the property being appraised. Discounting is associated with income
(generally net income) and value, which converts income amount to value estimation. In this action, the
proceeds or discount rate, or both are taken into account. In the substitute principle, it is deemed that the value
will be calculated through income flow providing the maximum return of investment.
5.2.3. Cost Approach
Cost approach takes into possibility the construction of another property that will provide the same or similar
benefit of the current property, instead of the purchase of the property. In this practice, the estimated value
includes depreciation for older or less-functional properties in cases where the likely price to be payable for the
new one being appraised excessively exceeds the current one.
As a result;
All market value assessment methods, technics, and procedures form common market value definitions on the
basis of criteria derived from the market and their correct application.
•
Benchmarking or other market comparisons must be based on market observations.
•
The income discounting approach, which also includes discounted cash analysis, must be based on cash
flows determined by the market and return rates derived from the market.
•
Construction costs and depreciation must be determined by an analysis conducted on the basis of marketbased estimations of costs and accumulated depreciation.
How the property will normally be transacted in the market determines what approach or procedures will be deployed
for market value estimation. Each of these approaches are comparative when they are based on market data. In each
appraisal case using one or more methods is generally the most representative of market activities.
The appraisal expert will identify which method or methods are viable for the market value determination by
considering all the methods specified.
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6
6.1.
LOCATION OF AND PHYSICAL SURVEY ON REAL PROPERTY
Location, Access, and Environmental Characteristics of Real Property
The subject property is located at the address Pelitli Road, No: 138, Balçık Village, Gebze District,
Kocaeli Province. The property is close to the TEM Highway, the main transportation arterial of the city,
located on the northern route, in the direction of Tuzla-Istanbul.
Tuzla MarbleMasons and Union
OIZ
Tuzla OIZ
Gebze OIZ
Tuzla Leather OIZ
and Free Zone
SUBJECT
PROPERTY
D-100
TEM
The close vicinity of the subject property is surrounded with innumerable industrial facilities and
Organized Industrial Zones (OIZ). The Chemical Industrialists OIZ, Marble-Masons OIZ and Association
OIZ are located to the northeast, Tuzla OIZ to the northwest, Honda, Isuzu, Migros central warehouses
and Bilmo Small Industrial Zone to the south, and Istanbul Free Zone, Tuzla Leather OIZ and GebzeOIZ
to the west.
Table. 9 Distance by Air of Subject Property from Some Centres
Centre
Distance*
TEM Highway
2.3km
D-100 Road
7.7km
Tuzla Centre
11.5km
Gebze Centre
6.0km
Sabiha Gökçen Airport
11.5km
Tuzla Train Station
11.0km
Balçik Village
2.0km
Pelitli Village
* Distances are measured via Google Earth.
2.5km
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Subject Project Area
TEM
HIGHWAY
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6.2
Description of Property
Structural, Construction, and Technical Specifications of Property, Details About Project, if the Subject of Appraisal is a Project.
View of Lot 177, Parcel 15 from the South Direction
The license/project and current status details of the current structures on the parcel were provided in
our report No. 15_400_123_05. As of this report date, the new building license has been issued and a
new project has been approved for the parcel. In order to demolish the current buildings, permission
must be obtained before February; these structures are excluded from the appraisal and the new
approved project is being appraised. Under the approved new project, two blocks are designed,
consisting of Block A and B, which have adjacent designs.
BLOCK
BLOCK A
A
BLOCK B
BLOCK B
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BLOCK A:
Block A is designed in its project with a total of six floors consisting of fourbasements + ground floor +
oneregular floor. The fourth basement has a gross construction area of 22,175.69m2 consisting of garage
and shelter areas. The second basement has a gross construction area of 20,696.05m2 consisting of
storage, technical rooms, and garage areas. The first basement has a total gross construction area of
1,143.45m² consisting of technical room, and office areas. The ground floor has a total gross construction
area of 15,269.10m² consisting of storage areas. The first regular floor has a total gross construction area
of 4,780.49m² consisting of prayer room, toilets, child care unit and electrical room. The total
construction area of Block A is designed in its project with an area of 64,064.78m².
BLOCK B:
Block B is designed in its project with a total of five floors consisting of four basements + ground floor.
The fourth basement has a gross construction area of 22,796.63m² consisting of storage, technical room,
and garage areas. The third basement has a gross construction area of 5,127.03m² consisting of office
units, prayer room, toilets and child care unit. The second basement has a gross construction area of
19,352.62m² consisting of storage, technical room, and garage areas. The first basement has a total
gross construction area of 3,866.34m² consisting of prayer room, toilets, and child care unit. The ground
floor has a total gross construction area of 20,488.65 m² consisting of storage areas. The total
construction area of Block A is designed in its project with an area of 71,631.27m².
Its project also has a water tank + water booster area on 325m2, a transformer building on 25m2, three
security booths, each 9m2 in size, a reinforcement wall, a sewerage area, and weighing areas.
Table. 10 Subject Project Area
ROZİ
FACTORY
Block A Gross
Construction Block A, Purpose of Use
Area, m2
Block A,
Leasable
Area, m2
Block B, Gross
Construction Block B, Purpose of Use
Area, m2
Block B,
Leasable
Area, m2
4th
BASEMENT
FLOOR
22,175.69
Garage + Shelter
-
22,796.63
Storage+TechnicalRoom+G
12,012.83
arage
3RD
BASEMENT
-
-
-
5,127.03
Office Units/Administration
Area
5,127.03
2ND
BASEMENT
20,696.05
Storage+TechnicalRoom+
Garage
4,433.32
19,352.62
Storage+TechnicalRoom+G
arage
4,577.80
1ST
BASEMENT
1,143.45
Office Units/Administration
Area
1,143.45
3,866.34
Office Units/Administration
Area
3,866.34
GROUND
FLOOR
15,269.10
Storage
15,269.10
20,488.65
Storage
20,488.65
1ST
REGULAR
FLOOR
4,780.49
Office Units/Administration
Area
4,780.49
-
-
-
TOTAL
64,064.78
-
25,626.36
71,631.27
-
46,072.65
Total Gross
Construction
Area, m2
135,696.05
Total
Leasable
Area, m2*
71,699.01
* Garage, shelter, and technical volume sections are not included in the calculation of leasable area.
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BLOCK A
BLOCK B
4th BASEMENT FLOOR PLAN
BLOCK B
3rd BASEMENT FLOOR
PLAN
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BLOCK A
BLOCK B
2nd BASEMENT FLOOR PLAN
BLOCK
A
BLOCK B
BLOCK B
1st BASEMENT FLOOR PLAN
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BLOCK A
BLOCK B
GROUND FLOOR PLAN
BLOCK A
BLOCK A
1st REGULAR FLOOR PLAN
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7
ANALYSIS OF DATA ABOUT REAL PROPERTY AND VALUATION CONCLUSIONS
7.1
Factors Influencing Value of Real Property (SWOT Analysis)
 STRENGTHS
• Large parcel area
• Indoor area of new factory building to be constructed according to its licenses and project will be
larger than other benchmark factories in the region.
• New factory to be constructed will have three different elevations thanks to its slope advantage.
WEAKNESSES
• Income loss during demolishment of current structures and new project construction.
7.2.
The Most Effective and Efficient Use Analysis
“The most possible use of a property is that which is physically possible, financially feasible, allowed by laws and
enables the subject property to reach its highest value.” (UDS Article 6.3)
"A use that is not allowed by law and is physically impossible, cannot be deemed as the best use that has the
highest efficiency. Both legally allowable and physically possible uses may require appraisal experts to explain
why such use is logically possible. In case one of more of these uses turns out to be possible, analyses are put
to test for their financial feasibility. Along with other tests, the use resulting in the highest value is the most
efficient and best use. (UDS Article 6.4)
The concept “the most efficient and best use” is the basic and integral part of market value assessments. The
most effective and efficient uses must fulfil four indirect criteria. These criteria are prioritised as follows:
• Physically possible
• Legally permissible
• Financially feasible
• Maximum efficiency
No different survey/improvement has been conducted by us for the most effective and efficient use
analysis purposes, as the project of the subject property on the parcel is approved in compliance of its
function, which is determined as “Industrial” in the application zoning plan, scale 1/1000.
7.3.
Methods Applied in the Appraisal and their Reasons
In the appraisal work, the investment cost of the newly-approved project is computed with the cost
analysis method, the data that will constitute land value, and the benchmarking analysis and these
values are summed to calculate the total value and current status value of the property by imagining
that the property is now completed. As the second method in the appraisal of property, the direct
income capitalisation method is used and detailed information about the calculations is provided in subheadings.
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7.3.1. Benchmarking Method Analysis
Inspections and results of the similar lands on sale and factory/warehouse for rent located close to the
subject project are provided in the following sub-section "Market Research and Results".
Market Research and Results:
Table. 11 LAND ON SALE BENCHMARKS
BENCHMARKS
LOCATION AND ITS PROPERTIES
AREA
(m2)
SALES
VALUE
(USD)
UNIT
VALUE
(USD/m2)
CONTACTS
78,320
14,097,600
180.00
Medya
The land with a gross area of 78,380 m2 located
approximately 1.5km north to the subject property,
registered at lot 19, parcel 1653 having the same zoning
BENCHMARK 1
rights as the subject property was purchased by Botosan
Building Cooperative with a m2 unit price of 180.00USD
as
specified
in
the
sales
agreement
dated
24.11.2014.
The industrial parcel, precedent: 0,80 zoned, with an
area of 21,500m2 located in the same region as the
BENCHMARK 2
subject property and which again will be subject to the
enforcement of Article 18 was purchased with a m2 unit
Yılbay
21,500
3,870,000
180.00
Gayrimenkul:
0532 5911994
price of USD 180.00 around five months ago (When
USD exchange rate was$1=2.55 TRY).
An industrial parcel (Parcel 371), precedent: 0.80 zoned,
with an area of 4,940m2 located around 1.5km north of
BENCHMARK 3
the subject property in the same region as the subject
4,940
1,165,000
235.83
7,500
1,500,000
200.00
property and which again will subject to the enforcement
Remax Yapı:
532 570 15 03
of Article 18 is up for sale with a negotiable asking price.
An industrial parcel, precedent: 0.80 zoned, with an area
BENCHMARK 4
of 7,500m2 located in the same region as the subject
property and which again will subject to the enforcement
Century 21:
0533 2115890
of Article 18is up for sale with a negotiable asking price.
OTHERS
According to information acquired from realtors active in the region and regional researches, the sales realised in the
region are around 175-220 USD over the gross (gross area before the enforcement) parcel area.
On the basis of exchange rates of T.C.M.B. on 25.12.2015, 1 USD =2.9123 (Buy), 1 USD =2.9175 TRY (Sell), 1
Euro =3.1904 TRY (Buy), 1 Euro = 3.1962 TRY (Sell).
 LAND MARKET RESEARCH RESULTS
A survey was made on the parcels located in the close vicinity to the subject property and having a similar position,
similar property rights, and harmonisation was provided by taking into consideration the recent sales, the current
discount shares, as well as the location and surface areas of the advertisements in the market.
As a result of research, it is concluded that the unit value per m2 of the subject parcel may be approximately 177
USD/m2 = ~ 515TRY/m2 by taking into account the extraordinary revaluation of the US Dollar against the
Turkish Lira prevailing in the market.
With the benchmarking analysis method the property’s land value is assessed as;
69,907.47 m² x TRY 515 /m2 = 36,002,347.00TRY
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Table. 12 RENTAL FACTORY/WAREHOUSE BENCHMARKS
BENCHMARKS
LOCATION AND ITS PROPERTIES
LEASABLE
AREA (m2)
LEASE VALUE
(USD/Month)
UNIT VALUE
(USD/Month
/m2)
7,300
26,000
3.57
CONTACTS
The facility occupied with a land area of 6,000m2,
factory/storage
BENCHMARK
1
area
7,300m2,
of
administration area of 1,000m
2
and
located in the
close vicinity of the subject property was put on
Ataşehir Ticari
Gayrimenkul:
0533 3257955
lease fora negotiable 26,000USD/month.
The factory with a total indoor area of 700m2
BENCHMARK
2
Efendioğlu
located in the close vicinity of the subject
property is on lease for a negotiable 2,400
700
2,400
3.42
Gayrimenkul:
0532 7487736
USD/month.
A facility with a storage/factory area of 3000m2
BENCHMARK
3
located in the close vicinity of the subject
property is on lease for a negotiable 19,500
3,000
19,500
6.50
1,000
4,800
4.80
USD/month.
Remax Kobi:
0532 2822898
The facility with a land area of 2,500 m2 and total
BENCHMARK
4
indoor area of 1,000m2 located in the close
vicinity of the subject property is on lease fora
Ataşehir Ticari
Gayrimenkul:
0533 3257955
negotiable 4,800 USD/month.
The facility with a land area of 1,250m2 and total
BENCHMARK
5
indoor area of 250m2 located in the close vicinity
of the subject property is on lease for a
250
1,400
5.60
negotiable 1,400 USD/month.
Çınar Paşa Emlak:
0530 3499721
According to storage/factory benchmarks surveyed in the region, the unit lease values demanded vary between 3.0OTHERS
6.5USD/month/m2 (~10-20TRY/month/m2). It is concluded that the unit lease value of the subject project may be
3.25TRY/month/m2 by taking into account all the conditions, theindoor area use and negotiation margins.
On the basis of exchange rates of T.C.M.B. on 25.12.2015, 1 USD =2.9123 (Buy), 1 USD =2.9175 TRY (Sell), 1 Euro =3.1904 TRY
(Buy), 1 Euro = 3.1962 TRY (Sell).
 RESULTS OF RENTAL FACTORY/WAREHOUSE MARKET RESEARCH
A survey was made on the rental factory/warehouse benchmarks located in the close vicinity of the
subject project and having a similar position, similar property rights, and harmonisation was provided
by taking into consideration the recent sales, the current discount shares, as well as the location and
surface areas of the advertisements in the market.As a result of surveys, it is concluded that the m2 unit
lease price may be around 3.25USD/m2/month by also taking into account the size of the indoor
occupation area for the new factory project to be constructed on the subject parcel.
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7.3.2. Cost Analysis
Cost approach is used in the calculation of the total value of the subject project. The following is the
cost analysis table.
Table. 13 Cost Analysis - Based on values if it were completed today
13 Cost Analysis - Based on values if it were completedtoday
APPROVED PROJECT BUILDING VALUE
Area, m2
Building
Group
Unit Value,
TRY/m2
Administration Building
5,923.94
3-B
700
4,146,758
Factory building
58,140.84
2-C
430
25,000,561
Administration Building
8,993.37
3-B
700
6,295,359
Factory building
62,637.90
2-C
430
26,934,297
3,872.14
2-A
270
1,045,478
Security Booths
27.00
2-B
370
9,990
Transformer
25.00
2-B
370
9,250
Water Tank + Water Booster
325.00
1-B
170
55,250
Type of Property
Total Value, TRY
BLOCK A
BLOCK B
GENERAL COSTS
Reinforcement Wall
OTHER COSTS
Project and Consultancy Cost
1.5%
952,454
Legal Permission and Charges
3.5%
2,222,393
External and Misc. Works (Lump Sum)- Concrete Site Flooring/Wall/Landscaping
TOTAL BUILDING VALUE, TRY
6,349,694
73,021,484
VALUE OF LAND LOT 177 PARCEL 15
Subject Property
Area,
m2
Unit Value,
TRY/m2
Total Value,
TRY
Lot 177, Parcel 15
69,907.47
515
36,002,347
SUBJECT PROJECT TOTAL VALUE (If it were completed today), TRY
109,023,832
With the cost analysis method, the total value of the subject project would be 109,023,832 TRY if the
project were completed today.
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Table. 14 Cost Analysis - Based on values of current construction level
COST ANALYSIS - BASED ON VALUES OF CURRENT CONSTRUCTION LEVEL
APPROVED PROJECT BUILDING VALUE
Area,
m2
Building
Group
Unit Value,
TRY/m2
Completion
Percent
Total Value,
TRY
Administration Building
5,923.94
3-B
700
0%
0
Factory building
58,140.84
2-C
430
0%
0
Administration Building
8,993.37
3-B
700
0%
0
Factory building
62,637.90
2-C
430
0%
0
Type of Property
BLOCK A
BLOCK B
GENERAL COSTS
Reinforcement Wall
3,872.14
2-A
270
0%
0
Security Booths
27.00
2-B
370
0%
0
Transformer
25.00
2-B
370
0%
0
Water Tank + Water Booster
325.00
1-B
170
0%
0
OTHER COSTS
Project and Consultancy Cost
1.50%
80%
761,963
Legal Permission and Charges
3.50%
80%
1,777,914
0
External and Misc. Works (Lump Sum)- Concrete Site Flooring/Wall/Landscaping
TOTAL BUILDING VALUE, TRY
2,539,878
VALUE OF LAND LOT 177 PARCEL 15
Subject Property
Area, m2
Unit Value,
TRY/m2
Total Value,
TRY
Lot 177, Parcel 15
69,907.47
515
36,002,347
SUBJECT PROJECT TOTAL VALUE (Current Status), TRY
38,542,225
With the cost analysis method, the total value of the subject project is calculated to be TRY 38,542,225
based on its current completion level.
7.3.3. Income Discounting Approach
In practice, the income discounting analysis is applied as two different methods; direct income
capitalisation and cash/income flow analysis.
7.3.3.1. Direct Capitalisation Method
With this method, the capitalisation ratio is determined by associating incomes earned by and the
market value of similar properties in the market. In the market analysis conducted for rental and on
sale properties located in the region of approved new factory project registered on lot 177, parcel 15,
the value relations are analysed and as a result the capitalisation ratio for the region is computed as
0.095 (9.5%).
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Value with Income Analysis Method - If it were completed today:
Project’s Total Leasable Area (Blocks A and B): 71,699.01m²
Monthly Lease Value: 71,699.01 m² x 3.25.-USD/m² = 233,022.00 USD/Month
Annual Lease Value: 233,022.00 USD x 12 Months = 2,796,261.00 USD/Year
Annual Net Income (Lease)
29,434,330.00 USD
2,796,261.00 USD
=
=
Capitalisation Rate
85,721,600.00 TRY
0.095
SUBJECT
PROPERTY
LEASABLE AREA
(m2)
MONTHLY
UNIT LEASE
VALUE
(USD/m2)
Map Section
G22B14C4B, Lot
177, Parcel 15
71,699.01
3.25
ANNUAL
LEASE VALUE
(USD/m2)
CAPITALISATION
RATE
SALES VALUE
(USD)
SALES VALUE
(TRY)
2,796,261
0.095
29,434,330
85,721,600
Value with Income Analysis Method - Based on Current Construction Level:
Value with Income Analysis Method - Based on Current Construction Level
Total Value, TRY
85,721,600
Total Project Cost, TRY
73,021,484
Expended Project Cost, TRY
2,539,878
Project Current Status Value, TRY
7.3.3.2.
15,239,994
Cash Flow Analysis Method
In the cash/income flow analysis, the most effective and efficient uses for the real property are
developed theoretically and long-term cash flows are computed. Net operating incomes calculated are
discounted from the discount resulting in the net today value of the subject properties. In the appraisal
work, income/cash flows analysis is not used.
8
8.1
ASSESSMENT OF THE RESULTS OF ANALYSIS ON REAL PROPERTY
Harmonisation of Analysis Results
With the benchmark analysis method for the land of the subject property only the land value is
assessed, and with the cost analysis method based on values if it were completed today, the total value
of the property is assessed as 109,023,832.-TRY. With the cost analysis method, the current status
value of the property is assessed as 38,542,225.-TRY.
As another method, the direct capitalisation analysis methodwas used and the rental factory/warehouse
benchmarks existing in the market was analysed and associated with the capitalisation rate found
appropriate for the region, resulting in a total value of property as 85,721,600TRYbased on “if it were
completed today”. With the direct capitalisation analysis method, the current status value of the
property is assessed as 15,239,994TRY.
The resulting value is reached by harmonising the values calculated with two different appraisal methods.
As the project is not yet constructedit is therefore difficult to currently work outthe exact construction
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quality and project risks and these values are assumed as minimum values. Therefore, this report must be
revised after completion of the project.
The total value of the subject project based on “if it were completed today” is assessed as
85,000,000TRY and the current status value is 38,500,000TRY.
Table. 15
Harmonisation Table
HARMONISATION TABLE BASED ON “IF IT WERE COMPLETED TODAY”
SUBJECT PROPERTY
COST ANALYSIS SALES VALUE
(TRY)
DIRECT INCOME
CAPITALISATION SALES
VALUE (TRY)
HARMONISED SALES
VALUE (TRY)
Map Section G22B14C4B,
Lot 177, Parcel 15
109,023,832
85,721,600
85,000,000
HARMONISATION TABLE BASED ON CURRENT CONSTRUCTION LEVEL
SUBJECT PROPERTY
COST ANALYSIS SALES VALUE
(TRY)
Map Section G22B14C4B,
Lot 177, Parcel 15
38,542,225
DIRECT INCOME
HARMONISED SALES VALUE
CAPITALISATION SALES VALUE
(TRY)
(TRY)
15,239,994
38,500,000
8.2 Whether Obstacles Exist against Inclusion in the Real Property Investment Partnership
Opinion about whether any obstacles exist that hinder the subject property, property project, or property rights and benefits to be
included in the Portfolio of Real Property Investment Partnerships under the Capital Market Legislation
Due to the fact that Block A located on the subject parcel was in conflict with the zoning legislation,the
letter dated 02.03.2015 of the Capital Market Board Presidency was issued, and with this letter one year
is given for restoring them to comply with the zoning legislation.The subject property was declared to
be a building under risk pursuant to Law No. 6306 on 20/10/2015 and the architectural project dated
27/11/2015 has been approved with two separate New Building License have been issued for Block A
and B.
It is considered that the current buildings on the subject property registered under SAF Gayrimenkul
Yatırım Ortaklığı’s title “Buildings” pursuant to the provisions of the Capital Market Legislation will be
demolished and that construction work will begin pursuant to the New Building License dated
27/11/2015. It is concluded that there is no issueas regardsthe buildings in the portfolio remaining
under the “Buildings” title of the Portfolio of Real Estate Investment Partnership until 19.02.2016,
pursuant to the Capital Market Legislation provisions.
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9
FINAL VALUE APPRAISAL AND CONCLUSION
The benchmark properties that may compete with the subject property in its region and the legal value
of the subject property were assessed by considering the transportation access and surrounding
structures. However, since they have not yet been constructed, these values must be re-calculated by
determining the quality of the construction materials onsite.
The net present value based on current construction level and the net present-based value based on “If
it were been constructed today” of the factory project to be constructed on map section G22B14C4B, lot
177, parcel 15, Balçık Village, Gebze District, Kocaeli Province are provided in the following tables.
Table. 16 Final Value Table;
SUBJECT PROPERTY
MARKET VALUE EXCL.
VAT (TRY)
MARKET VALUE
INCL. 18% VAT
(TRY)
MARKET VALUE EXCL.
VAT (USD)
Map section G22B14C4B, lot 177,
parcel 15, Balçık Village, Gebze
District, Kocaeli Province
38,500,000
45,430,000
13,219,791
On the basis of exchange rates of T.C.M.B. on 25.12.2015, 1 USD =2.9123 (Buy), 1 USD =2.9175 TRY (Sell), 1
Euro =3.1904 TRY (Buy), 1 Euro = 3.1962 TRY (Sell).
All the values expressed in the report are exclusive of VAT.
As a result;
 The total value, excluding VAT as of the appraisal date of map section G22B14C4B, lot 177, parcel
15, Balçık Village, Gebze District, Kocaeli Province is assessed as 38,500,000 TRY (Thirty-eight
million five-thousand hundred Turkish Liras).
 The total value, excluding VAT as of the appraisal date of map section G22B14C4B, lot 177, parcel
15, Balçık Village, Gebze District, Kocaeli Province is assessed as 85,000,000 TRY (Eighty-five
million Turkish Liras) if the project were completed today.
 The total value, excluding VAT as of the appraisal date of map section G22B14C4B, lot 177, parcel
15, Balçık Village, Gebze District, Kocaeli Province is assessed as 678,629 TRY (Six-hundred and
seventy-eight thousand, six-hundred and twenty-nine Turkish Liras)
Berkay OKÇUOĞLU
Urban Planner
CMB LICENSE NO: 402578
REAL PROPERTY APPRAISAL EXPERT
Didem ÖZTÜRK
Map Engineer Msc
CMB LICENSE NO: 402394
REAL PROPERTY APPRAISAL EXPERT
Aysel AKTAN
Urban Planner - Map Engineer
CMB LICENSE NO: 400241
APPRAISAL EXPERT IN CHARGE
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