Abstract
The growing interest in the enhancement, management, and sale of public building stock has increased the importance of their valuation and, as a result, the need to identify suitable methods for estimating value that take into account their peculiarities. They often boast architectural features (interfloor distance, layout, finishings, types of wiring/heating systems, etc.) that make them ‘extraordinary’ assets; in some cases, these features also endow them with monumental and/or historical importance. Thus, when valuating, it is necessary to adopt suitable methods. Where comparable examples or income-based parameters specifically concerning buildings with special features are lacking, the Depreciated Replacement Cost (DRC) method is the only system that can be used to estimate their market value. This paper aims to show how the DRC method can be applied in this specific market. The theoretical part will be coupled with a practical section where the DRC method will be used to estimate the market value of an extraordinary landmark building in Rome (Italy), the Palazzo degli Archivi di Stato (the State Archives building), in the EUR district, sold by EUR S.p.A. group (formerly known as Ente EUR) in 2015.
Highlights
Over the past 20 years, the use, enhancement, and management—or alternatively, the disposal and sale—of public real estate has become a significant issue in Europe [1].Before undertaking any kind of activity and/or action affecting public buildings, it is essential that their market value be estimated
This paper aims to show how the Depreciated Replacement Cost (DRC) method can be applied in this specific market
Having considered that the DRC method can be used to value special buildings that lack comparables, the aim of this article is to establish a way of applying it to the estimation of the market value of properties with special features, and which, boast extraordinary value, in accordance with the methodology codified in the EU by the Royal Institution of Chartered Surveyors (RICS) [14]
Summary
Over the past 20 years, the use, enhancement, and management—or alternatively, the disposal and sale—of public real estate has become a significant issue in Europe [1].Before undertaking any kind of activity and/or action affecting public buildings, it is essential that their market value be estimated. This kind of asset, representing an important part of the built environment, has to face the physical sustainability or the “sustainability of built environment” It should be emphasised, that in the wider perspective of the concept of “urban sustainability” (including the five dimensions of sustainability and their relationships: economic, social, ecological, physical, and political), physical sustainability, or the “sustainability of built environments”, “concerns the capacity of an intervention to enhance the liveability of buildings and urban infrastructures for ‘all’ city dwellers, without damaging or disrupting the urban region environment. It includes a concern for the efficiency of the built environment to support the local economy” [4]
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