the connection between law, zoning, and market value the example of entertainment properties in...
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The connection between law, zoning, and market value
The example of entertainment properties in Frankfurt/Main
Prof. Dr. Fabian Thiel
Professor of Real Estate and Property ValuationFrankfurt University of Applied Sciences
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Content
Regulations for entertainment properties
Exclusionary areas by zoning and influence on market values
Valuation problem of “trading-down”
Appraisal of entertainment properties (example), and hidden data
Summary
Spatial Planning in Germany
ComprehensiveSpatial Planning
Sectoral Spatial Planning
Federal Level
State Level
Regional Level
Legally-bindingLand-use planning
Land relatedsectoral planning
Set up of Protection Areas(Land Use Restriction)
Official Approvalof Plans
e.g. Land consolidation
Landscape P.Traffic P.Energy P.
e.g. Water Protection,Nature Protection,
Military Use
e.g. for streets,Airports,
Land fill sitesMunicipal Level
European Level
PreparatoryLand-use planning
Building plan
City DevelopmentConcept
Informal planning and instruments(e.g. City Development or Integrated
Rural Development Concepts)
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Regulations for entertainment properties in Germany
Law on Prostitution (2002) Federal Building Code Land Use Ordinance Tax laws (e.g., amusement tax) Local fees Industrial Code Programs on urban restructuring and
upgrading Decrees for exclusionary zones in
Frankfurt
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What is an „entertainment property“?
Unclear legal definition of an “entertainment property”; following the Federal Administrative Court:
discotheque – yes nightclub – yes swinger club – yes betting agency – no (because it´s retail) brothels and massage salons – no (because it´s business) … and “apartments”?
Problem of agglomeration of entertainment properties, gambling halls and „betting-cafes“ within the center of Frankfurt
Valuation and planning problem:„trading-down“
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Appraisal of entertainment property (2): Specialist Valuation
Total rooms available per annum: 172 lettable rooms
45% room occupancy rate Average achieved room rate: 120 € per
night, excluding cost for service, clothes, food
Running property expenses: 60.000 € for heating, 12.000 € for marketing and security
Unknown data on revenue, food, beverages
Unknown YP in perpetuity Unknown turnaround
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Appraisal of entertainment properties (3): general data
1,2 Million (male) customers in Germany; turnover: 14 billion € p.a., 50% part of GDP; 50 % for danegeld, rent, clothing, and security
Estimation of “market activity”?
Definition of “market value” for entertainment properties?
Ownership arrangements, leases, danegeld, (hidden) “operating costs”?
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Summary
Current amendments of the Prostitution Law will influence (intervene) in market activities
Normative pluralism of planning law
Problem: Tolerance of uses
„Non-aggression“ agreement between police and owners of entertainment facilities
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Contact
Prof. Dr. Fabian Thiel
Frankfurt University of Applied Sciences
bodenrecht@fabian-thiel.de
www.fabian-thiel.de
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