Valuation for commercial properties and business owners
The acquiring authority will instruct an independent valuer to inspect your property and your business and prepare a valuation report.
How business compensation is valued
Calculating compensation for the acquisition of land on which your business operates can be a complex matter.
Compensation must be assessed on a case-by-case basis that takes into account matters such as whether you have a legal interest in the property, the nature of the interest, the feasibility and cost of relocating the business, and possibly the value of the business itself.
Out of pocket costs arising from the acquisition may also be compensable, if reasonably incurred. Any information requested about the operation of your business is kept in the strictest confidence.
Your lawyer and valuer will be able to advise you on your compensation rights and the information you will need to provide to complete this assessment. We recommend you ensure they have the necessary expertise to properly advise you.
How your property is valued
The acquiring authority will instruct an independent valuer to inspect the property and prepare a valuation report which sets out the valuer’s assessment of your entitlement to compensation under the Land Acquisition (Just Terms Compensation) Act 1991 (the Just Terms Act).
Sometimes the valuer will need assistance from experts in other fields, such as business relocation. Those experts will likely also visit the property and prepare their own reports. Your acquisition support team will try to co-ordinate the inspections, so they minimise impacts on you.
The valuation report is used to form the basis of an offer of compensation from the acquiring authority.
The valuation report will assess your entitlement to compensation in line with Section 55 of the Just Terms Act. Section 55 provides for compensation to be assessed having regard to:
- the market value of your interest, if any
- any special value to you
- any loss attributable to severance
- any loss attributable to disturbance
- the disadvantage resulting from relocation if the property is your principal place of residence
- any increase or decrease in the value of any other land of the person at the date of acquisition which adjoins or is severed from the acquired land by reason of the carrying out of or the proposal to carry out the public purpose for which the land was acquired.
Getting your own valuation
Parties with a legal interest in the property to be acquired are encouraged to obtain their own advice from an independent valuer and a lawyer.
When the acquisition is settled, the compensation payment will include a component for valuation fees that you have reasonably incurred as long as the valuer is appropriately qualified.
If you need to engage other services such as accountants, town planners, or quantity surveyors, it may be worthwhile to first discuss with your Acquisition Manager whether the costs are likely to be included in the compensation payment.
Speak to your Acquisition Manager for more information.
Your valuer must have one of the following qualifications:
- full member of the Australian Valuers Institute (not an associate or student member)
- full member of the Australian Property Institute (not a student or provisional member), obtained because of their occupation as a valuer
- full member of the Royal Institution of Chartered Surveyors as a chartered valuer.
Find a qualified valuer
These organisations can give you independent advice on finding a qualified valuer.