Confessions of a valuer, chapter 14: aircraft carriers and yellow paint – The Property Chronicle
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Confessions of a valuer, chapter 14: aircraft carriers and yellow paint

Investor's Notebook

In this very special series of exclusive articles for the Property Chronicle, Australian property legend Norman Harker reflects on his extraordinary 50-year life in real estate. He will pull no punches partly because, as he freely admits, Norman has a limited life expectancy of five years from December 2018 due to a diagnosed terminal blood cancer, which he has cheerfully accepted in preference to (in his words) “kicking the bucket without notice”. We are honoured he has chosen us to publish these brilliant, funny and incisive reflections of a lifetime in property.

Chapter 14: Aircraft carriers and yellow paint in Scotland

Note: Figures and facts are changed from the truth for simplification purposes. The essential detail is absolutely true.

To conclude boring the bejesus out of you regarding sordid rent reviews, I’ll jump ahead seven years to 1979. The Tardis better work bringing me back next month.

Two associated companies had three less than brilliant ideas:

  1. I should handle a rent review for them.
  2. They’d ignore that my probable failure would cost them.
  3. They’d ignore the fact that the property was in Scotland, where the legal system is completely different.

Never one to tell clients where to go, I met them, and they gave the history.

Twenty years earlier, they had decided to set up a port in Scotland not far from Stranraer, where there was a port operated by British (Low Speed) Rail. They had feared that a real competitor might set up nearby. One place close by was viable – a long pier at Cairnryan that projected at an acute angle into Loch Ryan through which fairies had to pass to get to the Irish Sea and Northern Ireland.

The Disunited Kingdom (left), and the Battle of Cairnryan (right):

In 1959 Cairnryan pier was used by a firm of shipbreakers. My clients had negotiated a lease for 99 years covering just the first 1,000 ft of this pier from high-water mark, plus land preventing alternative access, plus a road leading to it. The rent was £25,000 per annum, reviewed every 20 years.

“OMG!” I said. “Why didn’t you ask me to advise you back then?” They replied, “You were only 12 years old at the time!” I reluctantly conceded this point, although my olde school (Colchester Royal Grammar School) would have loved to have got rid of me.

Their problem: an increase for 20 years without review.

My problem? I asked one question. “Now that you’ve spent mega money on building your port, how much would you pay now to stop a real competitor?”

Investor's Notebook

About Norman Harker

Norman Harker

Norman Harker FRICS FAPI, the Principal of Sydney-based consultant Norman Harker & Associates, is a specialist Excel property consultant, with expertise in developing, validating, and securing the robustness of Excel DCF and CF analyses for analysing transactions, valuations, investment analysis and feasibility studies. He was an elected New South Wales divisional board member of the Australian Property Institute in 2013-2015 and for many years was a senior lecturer at the University of Western Sydney, where he specialised in developing applications for the use of practising valuers; before that he lectured at the University of Aberdeen in Scotland. He began his career at Conrad Ritblat & Co in London, where he rose from trainee valuer to associate partner. He was diagnosed with incurable multiple myeloma in 2018 and given a life expectancy of five years, and also suffers from an incurable and often inappropriate sense of humour.

Articles by Norman Harker

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