cape value - value proposition

VALUE PROPOSITION

“Cape Value is a professional services firm offering specialised valuation, business advisory and e-learning services.”

021 910 0072 [email protected] 91 Stellenberg Road, Oak Glen, Bellville

www.capevalue.co.za

Index

About the Cape Value Group 3

Property Valuation 4

Business Consulting 10 E-learning 17

2www.capevalue.co.za

About the Cape Value Group

Our vision is to establish ourselves as thought-leaders throughout South Africa and Africa by delivering specialised valuation, business advisory and e-learning services.

Our mission is to employ enabled and effective people fitting our core values in order to offer outcomes-based services with tangible value creation.

Our values are to build relationships, employ logic and deductive reasoning, work with absolute thoroughness, be innovative and entrepreneurial, and be continuously forthright and seeking improvement.

By using our services, clients gain access to unique knowledge management practices and approaches developed internally over time. The quality of our reports, personal service, intellectual property, internally developed models and the nature of our research contribute to empowering our clients in the decision

making process and lowering overall risk with the ultimate aim of creating shareholder or personal wealth.

Clients include individuals, SMME’s, multinational enterprises (MNE’s), government and parastatals. The head office is situated in Bellville (Cape Town) while we operate as a Level 4 BBBEE contributor throughout South Africa & Africa, travelling as required by our clients.

The fundamental differentiation of Cape Value’s services is based on enabled people, speed and quality, and a continual quest to learn and improve.

Cape Value is a professional services firm offering specialised valuation, business advisory and e-learning services.

2 3www.capevalue.co.za

Cape Value (Pty) Ltd Property Valuers is a professional services firm offering specialised valuation and appraisal services of property, plant, machinery, equipment and rights in property.

of the International Valuations Standards Committee (IVSC), and International Financial Reporting Standards (IFRS).

Cape Value utilises internationally recognised software and believes that true asset value can only be determined by taking a historic, current and future view.

We offer more than 40 years of experience and Professional Indemnity (PI) for your peace of mind. Cape Value tailors each project to our client’s specific requirements and valuation motivation. We conduct physical inspections and do not rely on desktop or automated valuations.

We never disclaim our research conclusions, unless limitations are specifically stated.

We offer valuations on:

• Commercial Real Estate;• Industrial Real Estate;• Retail Real Estate;• Residential Real Estate;• Agricultural Real Estate;• Development Real Estate;• Plant, Machinery & Equipment (PME);• Specialised Real Estate;• Real Rights;• Movable Assets.

The Cape Value valuers are registered with the South African Council for the Property Valuers Profession (SACPVP) and the South African Institute of Valuers (SAIV). Reports are fully motivated and in compliance with the South African Institute of Valuers (SAIV), the Standards and Generally Accepted Valuation Principles (GAVP)

Property Valuation


New Replacement Cost and Reproduction Cost

A new replacement cost valuation is often required for insurance purposes.

Primary benefits include:

• Dynamic process insurance model;• Proprietary models and knowledge management

processes.

Market Value and Market Rent

A market valuation can be required in various instances such as when deciding to buy or sell, rounding up an estate late, managing a portfolio of investments, reporting for financial statements or legal purposes such as disputes or divorces.


• Physical identification of market transactions;• Subscriptions to 3rd party data is further improved

and overlaid with internal research and analysis.

Fair Value (Current or Future Utility)

Fair value can be considered when there are disputes on value based on current and future use. In some cases the property’s value is not based only on its current use, but also the probable future use as perceived by the market.


• Value based on current utility;• Value based on future utility;• Physical identification of market transactions;• Subscriptions to 3rd party data is further improved


The Services we offer


Synergistic Value

Combining two tracts of land or operating a building in association with another will, to reflect the true value, require a synergistic approach as the value is embedded in the conjunctive use.

Primary benefits:

• Value of the property accounting for an increase in utility, functionality or potential scarcity;



Residual Value

This approach is normally associated with a development. When, as an owner, you are contemplating selling a property to a developer or when a developer is anticipating purchasing a property, the value basis would most often be that of residual value.


• Highest and Best use analysis for both vacant and currently improved properties;

• The highest and best use is the use that delivers the highest value consistent with market risk and return requirements;

• Any HABU discussion should include a spectrum of uses, timing for these uses in terms of absorption, rents, occupancy and the most probable market participants or users;




Liquidation Value

The liquidation value of a property or asset is important for risk management purposes. Similar terms include forced sale or fire sale value. Owners, investors or financial institutions take the liquidation value as a measure of minimum value and therefore an indication of exposure. Primary benefits:

• Valued under orderly conditions or forced sale conditions;

• Value piece by piece (for example machinery) or as a whole;




Sales Comparison Approach

A Sales Comparison Approach to value, considers the sale of similar or substitute properties and related market data and establishes a value estimate by comparing the information.

Income Capitalization Approach

The Income Capitalisation Approach is a comparative approach to value that considers income and expense data relating to the property being valued and estimates value through a capitalisation process.

Cost Approach

The Cost Approach calculates the current cost of replacing an asset with its modern equivalent asset less deductions for physical deterioration and all relevant forms of obsolescence and optimisation.

Residual Approach

The Residual Approach refers to the estimated amount that an entity would currently obtain from the disposal of an asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

Profits Approach

The Profits Approach is also sometimes referred to as the accounting method. This approach states that the rental amounts and capital values of assets are usually influenced by the potential to generate profit. Therefore, profits can be used as a basis to determine the value of a property.

Methodology


Valuation Process

1. Inquiry

+27 21 910 0072

[email protected]

www.capevalue.co.za

5. Market Survey

Property or asset specific research

Analysis of data and application to subject property or asset

Assumption testing

Internal panel-based valuation review

2. Proposal

Indication of information to be supplied versus to be obtained or researched by Cape Value (Pty) Ltd

Formal proposal

Should you wish to proceed:

Proof of deposit

Documents to be supplied

6. Compilation

Application of market analysis and assumptions

Client specific reporting requirements

Alignment of reporting standards

Quality control

3. Preliminary

Perusing of documents

Site identification and preparation for inspection

Methodology and model configuration or development (peer reviewed and international sourcing)

Any additional research required at this stage

7. Finalisation

Discussion of results

Incorporation of comments

Final report

Client to provide proof of balance payment

4. Site InspectionClassification

Photo/picture record

Condition assessment

Measurement

Interview with representatives or other stakeholders

Inclusion of any changes to original proposal

8. Feedback

Customer satisfaction evaluation

Referral

Channel preference registration


Cape Value (Pty) Ltd Business Consultants is a professional services firm offering specialised knowledge management, new business development, systems-based risk management, and investment decision analysis services.

standard theories are critiqued for not being adequate in explaining real world events.

Even if we assume that events are infrequent, they are not insignificant and have a meaningful impact on business, real estate, and finance. This calls for a different perspective on how we traditionally interpret and understand industries and markets to work.

To find out more about our perspective, please visit our website.

The Cape Value consultants are internationally recognised researchers and professors of strategy and knowledge management, MBA graduates and MSc Property Study specialists with senior project experience.

Service Premise

The world of finance, real estate and business in general has become increasingly volatile over the past number of years. Events previously considered infrequent and negligible has become more significant, if not more frequent. The world is increasingly complex and old

Business Consulting


http://www.capevalue.co.za/business/about-business-consulting/

Knowledge Management in Business

The value benefits associated with this service include:

• Business Process Improvement: Addressing inefficiencies and improving overall business performance.

• Knowledge Strategy Analysis and Development: Creating a knowledge strategy and managing knowledge workers is key to a sustainable business.

• Knowledge Creation (Innovation): Firms need to pursue knowledge creation activities aimed at improving internal processes or external product or service delivery.

New Business Development


• International or Local Bankable Business Plan: We compile internationally accepted reports for financing or stakeholders’ purposes. We also test the idea in the market place.

• Business Model Creation or Evaluation: Every business should have a business model. Evaluating an existing business model, or putting structure to an idea is an indispensable requirement for any business entrepreneur or executive.

Investment Decision Analysis in Real Estate


• Investment Value Analysis (Not Market Value): Investment value is not market value in that the former takes into consideration the subjective requirements of the investor i.e. cost of equity, cost of capital, yield requirements, risk profile, and tax profile.

• Portfolio Risk Management and Adjustment: Every prudent investor would like to know the level of risk associated with its portfolio of investments. Cape Value’s interpretation on risk is aligned with chaos theory, meaning that risk is adjusted for a volatile environment.

• Portfolio Acquisition and Disposal: When buying or selling portfolio investments, investors need to ensure their needs are met and business interests are protected and done in a sustainable manner.

We offer the following four classes of service


• Investment Alternative Analysis: The availability of alternatives and associated benefits or limitations influences the investment value.

• Investment Negotiation and Representation: Often, having a professional representative in an investment negotiation, assists the process through access to specialist knowledge and objective decision making.

Systems-Based Risk Management: In Business


• Systemic Market Risk Identification and Mitigation Strategies: Markets and industries are constantly changing. The need exists, through a visual representation and analysis, for the identification and mitigation of systemic market risks.

• Competitive Risk Management: The accuracy of decisions is often a function of the quality of competitors. Cape Value can act as a research team in mapping and advising on the business models and implications of competitor actions.

Systems-Based Risk Management: In Real Estate


• Systemic Market Risk Identification and Mitigation Strategies: Whether an investor, owner-operator or farming enterprise is managing an existing investment or planning for a new or first investment, there is a continuous need for understanding the workings of the market and its potential influences on strategic decision making.

• Sub-Business Tenant Mix Risk Management: Investment value and risk is a direct function of the quality of tenants when applying for finance. A tenant’s risk profile should more accurately be determined by mapping the business model of existing and prospective tenants. This allows insight into the sustainability of your tenant mix and delivers a more robust approach to managing risk. Cape Value can act as a research team conducting these analyses and advising on portfolio decisions.


Our approach and differentiation is to access the knowledge embedded in the various key persons through a mapping technique that will allow the identification and analysis of links not previously considered or available.

Systems based techniques allows for the representation of a market system in the form of a map commonly referred to as an influence diagram (ID) or a systems diagram (SD).

A map can be developed at both a macro or meso level, allowing through the analysis of the diagram the proactive identification of systemic risks and changes together with associated response strategies.

Systems dynamics offer three methods:

• System Dynamics (SD) based on influence diagrams (ID);

• Qualitative System Dynamics (QSD);• Qualitative Politicised Influence Diagrams (QPID).

To find out more about our methodology, please visit our website.

Consulting Process

The processes described on the following pages are to provide an overview and are not exhaustive.

For on-going consultation, the service process will be managed specific to the enquiry and nature of research, analysis, representation or business.

Methodology


http://www.capevalue.co.za/business/about-business-consulting/

Consulting Process - Knowledge Management/Systems Thinking

1. Inquiry

+27 21 910 0072

[email protected]

www.capevalue.co.za

5. Analysis

Describe model

Apply view point analysis

Identification of risks/knowledge requirements

Response strategies (generic/specific)

2. Proposal Define basis of analysis

Project outcomes

Assumptions

Methodologies

Duration

Cost


Proof of deposit


6. Compilation


Alignment of reporting standards

Quality control

3. Preliminary


Work group setup

Methodology and model configuration (international sourcing)


7. Finalisation

Key findings discussion


Final report(s)


4. Data Collection

Conduct first mapping session

Post-session internal quality control

Conduct second mapping session

Final model

8. Feedback


Referral


www.capevalue.co.za 14www.capevalue.co.za

Consulting Process - Investment Value Analysis

1. Inquiry

+27 21 910 0072

[email protected]

www.capevalue.co.za

5. Market Survey

Property or asset specific research

Analysis of data and application to subject property or asset

Assumption testing

Internal panel-based review

2. Proposal

Indication of information to be supplied versus to be obtained or researched by Cape Value (Pty) Ltd

Formal proposal


Proof of deposit


6. Compilation

Application of investment analysis and client specific assumptions


Alignment of reporting standards (IVS & IFRS)

Quality control

3. Preliminary


Site identification and preparation for inspection

Methodology and model configuration (discounted cash flow)


7. Finalisation

Discussion of results


Final report


4. Site InspectionClassification

Photo/picture record

Condition assessment

Measurement

Interview with representatives or other stakeholders

Inclusion of any changes to original proposal

8. Feedback


Referral



Consulting Process - New Business Development

1. Inquiry

+27 21 910 0072

[email protected]

www.capevalue.co.za

5. Market Survey

Conduct analysis

Report findings

Address project outcomes

2. Proposal Define basis of analysis

Project outcomes

Assumptions

Methodologies

Duration

Cost


Proof of deposit


6. Compilation


Alignment of reporting standards (international standards / bankable document)

Quality control

3. Preliminary


Setup questionnaires

Identification of survey participants


7. Finalisation

Key findings discussion


Final report(s)


4. Data Collection

Conduct primary data survey

Quality control

Describe data

8. Feedback


Referral



E-learning gives you the opportunity to get training in real estate valuation, investment decision analysis, knowledge management and new business development.

Investment Property: Discounted Cash Flow AnalysisThis course is designed to introduce participants to Discounted Cash Flow Analysis and the application of DCF to the valuation of investment properties.

Upon completion of this course the participant will, amongst other skills, be able to:

• Articulate the concept of DCF Analysis and appreciate its power in finance;

• Calculate Present Value of cash flows using appropriate discount rates;

• Value investment property using DCF.

Need more details about Investment Property: Discounted Cash Flow Analysis?

Fundamentals of Residential Property Valuation

This course is aimed at linking theory with practice and empowering participants with tools and thinking models to accelerate their learning in either their pursuit of finding suitable employment or to potentially improve current research processes and insight into investment decisions.

Upon completion of this course the participant will, amongst other skills, be able to:

• Articulate the fundamental principles of property valuation;

• Carry a working knowledge of the valuation process;• Value freehold and sectional title residential property. Need more details about Fundamentals of Residential Property Valuation?

E-learning


http://www.capevalue.co.za/learning/courses/




Knowledge Management in Business

This course is designed to introduce participants to Knowledge Management (KM) and the application of KM to business management decisions. Upon completion of this course participant will, amongst other skills, be able to:

• Articulate the nature of organisational knowledge;• Understand best practice aspects of knowledge

management;• Apply the knowledge management process to a real-

world question.

Need more details about Knowledge Management in Business?




cape value - value proposition

Business

market value

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cape value valuers

true value

value proposition

propertys value

value basis

current utility value