Settlement has been reached finallyon the collective enfranchisement of a block of 8 flats just off Grosvenor Square – Mayfair’s primest location.
The valuation process was complicated due to 3 of the lessees owning 92.56 year overriding [OR] leases that ran alongside the original 2.56 year short unexpired leases still in existence, another 3 owning 90 year extended reversionary leases under the s56 of the Act and the final 2 owning 127.58 year reversionary leases.
Having negotiated the notional vacant possession freehold values of all the flats as low as possible as a first step with Grosvenor’s retained valuers Paul Tayler Ltd; the next step was to negotiate the technical valuation inputs with Gerald Eve. The main task in the second step was bizarrely to settle relativity as low as possible for the original 2.56 year short unexpired leases still in existence running alongside the 92.56 year OR leases in order to maximise the resulting marriage value for which the 3 OR lessees wearing their ‘landlords hats’ will receive back a half given they between them accounted for just under 99% of all the landlords’ interests before marriage value.
The result produced a final net settlement premium to Grosvenor just £300 greater than my initial best settlement target advised to the lessees before the service of the s13 notice claiming the freehold.
The lessees were delighted with the first of the two lead lessees commenting: “Thank you for all your efforts on our behalf in the acquisition of the freehold – it was not without its frustrations but we got there and I’m sure will all be happy with what we will now hold in one of the world’s premier locations!” with the other adding “Always a pleasure working with you.”