We value not only complex commercial real estate and hotels. We also have significant office segment facilities in our portfolio. In 2019, experts from Valrus Ltd. conducted a valuation of the cadastral value (establishment of the cadastral value of real estate objects in the amount of their market value) in the framework of cases challenging the cadastral value. the Nordstar Tower Business Center. The cost was determined as of 01.01.2016 and 01.01.2018. At the same time, the cost of both the capital construction object and the land plot on which it is located, so the entire complex was determined.
The income approach was used as the main approach, since the object is investment-grade real estate, the value of which is determined precisely by cash flows from renting premises. This business center is one of the largest office real estate facilities in Moscow, with an area of more than 100 thousand square meters with underground parking. The premises from 1st to 8th floor are divided into two functional spaces: multi-level parking and office space. These features do not allow us to correctly determine the cost of an object within the framework of a comparative and cost-based approach.
At the end of 2019, judicial reform, judicial practice in relation to value added tax (VAT) began to change, which is why the results of conclusions with a certain value of real estate objects were revised excluding VAT, as required in the issues raised by the Court.
In particular, in the framework of the cases on which the value of real estate was determined as of 01.01.2016, a re-examination was assigned to another expert, and in the framework of the case on determining the market value of objects on 01.01.2018, an additional valuation examination was appointed, the production of which was also entrusted to Kartsev P.V. In both cases, it was already necessary to determine the value of the same objects regardless of VAT.
The re-examination of the valuation as of 01.01.2016 showed deviations from the values determined by the expert of Valrus Ltd. within +6% (when determining the value in comparable quantities) for the capital construction object and -6% for the land plot. In fact, the re-examination confirmed the results obtained by the expert Kartsev P.V.
According to the results of an additional valuation examination in the framework of determining the value of objects, as of 01.01.2018, the market value of objects exceeded the cadastral value established within the framework of the State State cadastral valuation сommittee.
The representative of the administrative plaintiff did not agree with the conclusion of the forensic examination, submitted written objections, and filed a petition for the appointment of a re-examination in the case. The Court requested written explanations from the Expert. In the explanations sent to the court, Expert Kartsev P.V. convincingly and in detail answered the objections of the parties, written explanations were attached by the court to the case materials. It can be seen from the expert's explanations provided that the comments to the expert opinion were not confirmed, in connection with which the court refused to satisfy the requests for the appointment of a re-examination in the case. The grounds provided for in Article 83 of the CAP of the Russian Federation for the appointment of a re-examination were not established at the court session, in itself the disagreement of the parties with the market value of real estate objects determined by the expert is not the basis for the appointment of a re-examination in the case.
Source: photo materials from the website: Business Center Nordstar Tower
The purpose of the administrative plaintiff's appeal to the court was to reduce the burden of maintaining the property owned by him in connection with an overestimation of the tax base for calculating property tax, which is subject to calculation based on the established cadastral value of the real estate object. The amount of rent for a land plot also depends on the cadastral value.
The establishment by the court of the cadastral value of real estate objects in the amount of the market value exceeding the cadastral value disputed by the administrative plaintiff will lead to a deterioration of his position, which is unacceptable in the case under consideration, taking into account the position of the European Court of Human Rights (paragraph 40 of the decision of May 24, 2007 "R. against the Russian Federation, paragraph 80 of the decision of December 06, 2011 "Gladysheva against Russia"). In this regard, the court refused to satisfy administrative claims to challenge the results of determining the cadastral value of real estate.