intangible assets and value of buildings
Buildings consume 43% of energy in France and generate 22% of greenhouse gas emissions in the country. In order to reduce the sector’s impact and fight climate change, legislation concerning energy transition has established ambitious objectives for management of energy consumption and greenhouse gas emission reductions. Energy efficiency improvements, environmental performance, positive energy buildings: the buildings sector is constantly innovating in anticipation of future challenges. Goodwill-management accompanies clients in measuring value created by construction or renovation projects for the environment as well as for its tenants.
(1) Source : ADEME - (2) Source : www.effinergie.org
Why measure value in use of a building?
Constructing or renovating a building in consideration of environmental impacts and implications on tenants’ well-being requires significant investments. Goodwill-management accompanies clients in the measurement of value brought forth by buildings.
For facility managers, administrative entities, developers and construction companies, an intangible valuation of buildings offers insights on:
- Long-term value created by the building
A part of this value is measured directly in terms of avoided costs associated with energy savings. However, much of the value associated with buildings is indirect. For example, offices have an impact on the productivity of its tenants – in fact, it has been proven that well-being at the workplace has a direct impact on the motivation of employees.
- Justify and value best-performing building construction and renovation projects for investors and future tenants
Through our methods, we highlight the services offered by a building to its tenants. A company will typically accept higher rent charges if the office offers excellent working conditions to its workers and increases their productivity.
How can intangible assets contribute to building valuations?
The value of a building can be determined by market price or value of future profits. This value can also be deduced from the services the building offers to its tenants: “value in use,” which is calculable through intangible asset evaluations. Our methods are applied to both office and housing buildings.
We have identified 5 principal components of a building’s value: technical qualities, functional qualities, location, contributions to its territory of implantation, and esthetics.
We can calculate the value created by 4 of these components:
Our services are made up of 3 parts:
Qualitative extra-financial methodology
Composed of 400 questions, our Thésaurus-Ecopolis evaluates the technical and functional performance of a building as well as its location and benefits related to biodiversity and externalities to its area of implantation.
Financial balance sheet for the tenant
Services provided by the building to its tenants are evaluated in terms of euros, which represent the savings incurred in one building over another. We have developed a measure of productivity of employees in a building, as well as a model to calculate the cost of commuting time for employees.
Quantitative financial methodology
Economic benefits of buildings are integrated into a DCF equation, which measures the impact of services provided by buildings on the asset’s value. We also evaluate the global value of a building.
Few case studies
- Capital Immatériel
- Finance Et économie
- KI Batiment
- Valo Batiment