Real Estate Appraisal Report - listed...

Real Estate Appraisal Report

Project Name: Appraisal Report of Industrial Real Estate on the

Floor 4, Block D, Gangxia Industry Park, 319 East Hubin Road,

Xiamen, Fujian, China

Consignor: Ideal Jacobs (Xiamen) Corporation

Consignee: Xiamen Da Xue Assets Appraisal Co., Ltd.

Appraiser: Wang Zhi Dong, Li Yi Feng, Huang Ji Chao

Appraisal Period: From May 2nd , 2013 to May 3rd, 2013

File No.: Xiamen Daxue Real Estate Appraisal Report No.

2013-FS-real estate-0563

Content

I. Letter to consignor .......................................................................... 3

II. Statement of appraiser .................................................................. 4

III. Hypotheses and restriction of the appraisal .............................. 6

IV. Report of appraisal conclusion .................................................... 8

V. Appendices ..................................................................................... 16

Floor 4, Block D, 319 East Hubin Road, Si Ming District

Xiamen Da Xue Assets Appraisal Co., Ltd. Page 4

Statement of Appraiser

We hereby solemnly declare that:

1．The facts stated in our appraisal report are genuine and accurate.

2．The analysis, remarks and conclusion made in our appraisal report are based on

our professional and fair judgment, but limited by the precondition and restrictive

condition for appraisal specified in the appraisal report.

3．We do not have any benefit relation to the appraisal object and neither have any

benefit relation and prejudice with regards to the relative parties.

4．According to the National Standard Code for Real Estate Appraisal, we made our

analysis, remark and conclusion and compile this appraisal report.

5．Our real estate appraisers Mr. Wang Zhi Dong with the certification no. of

3520070010, and Mr. Huang Ji Chao have carried out on-site inspection on appraisal

object mentioned in the appraisal report. However, unless otherwise agreed, the scope of

on-site inspection is restricted to appearance and use status of the appraised object. The

appraisers do not shoulder the responsibility for investigating the structure and quality of

the building as well as for examining other overlaid, unexposed and unreachable parts of

the appraised object.

6．The appraisal was performed without any professional help other than our own

staff.

7．The appraisal is based on the relevant documents supplied by the consignor who

shall be held liable for the authenticity, completeness and consequences incurred. Both

the appraisers and the appraisal company shall not be held liable for the wrong appraisal

results in case of the wrong documents supplied by the consignor.

8．The report shall only be used for the purpose of appraisal by the entrusting party.

The report shall not be used for other economic activities and other use. The consignor

should use the appraised value reasonably. Both the appraisers and the appraisal

company shall not be held liable for the unreasonable use of the appraisal results by the

consignor.

9．The appraisers shall be only held liable for the operation process and fairness of

the appraisal method adopted. The appraisers shall not be held liable for the final price

determination of the property on any transaction. The results of the appraisal report shall



Hypotheses and Restriction of the Appraisal

I. Hypotheses of the Appraisal

1. This appraisal is based on the conditions that the property is satisfied with the

basic function for current use and is also continuously used in a reasonable period. The

real estate market at the appraisal time operates publicly, equally and voluntarily. Any

operation mode and procedure relating to the appraised object shall comply with the

relevant national and local laws and regulations. Some factors, such as accidents or force

majeure, are not taken into consideration for valuation conclusion.

2. The ownership of the subject property is clearly established, and no ownership

dispute is involved at the time point of the valuation. And the subject property has

qualified with the function on use supplied by the consignor.

3. The appraisal value includes the corresponding value of the right use of land.

4. The appraisal value is the open market value of the subject property as the

appraisal date under the set condition of the report. We suppose that:

① Have a public, active, and advanced real estate market;

② The real estate can be purchased freely in public market;

③ One party of the transaction does not have any benefit relation with regards to the

other party. The purpose of the transaction is to obtain the maximum benefits for each

party.

④ Have a reasonable time to make discussion and exchange, so as to make full

consideration about the real estate quality and market condition, then negotiation, then

negotiate a price. Make no consideration about the additional price of the special

purchaser.

⑤ A reasonable negation period is required to fulfill the transaction and achieve the

reasonable price. Within the period, the market and physical conditions of the property

will keep stable accordingly.

5. The appraisal time is on May 2nd, 2013. The appraisal result in this report is the

market value of the real estate at the appraisal time of May 2nd, 2013, and meets all the

presumption and restrictive conditions. Our company shall not be liable for the great

change of the price of the subject property after the appraisal time of May 2nd, 2013.

II. Data without researching inquiry in the report



1. The appraisers make on-site inspection for the current appearance and use

conditions only. We can’t accept the requirement of construction test and equipment

checking. So we could not make sure whether the real estate has any scathe inside. We

supposed that there is no severely quality problem in the base and structure of the subject

property, and that the property will be used continuously in the left economic life period.

2. The consignor has supplied the Certificate of Land and Property and some

relative materials as on consignation. Some other data such as the right to share land area,

the year of completion, and else, we have acquired from the file departments of the

Xiamen Land and Property Bureau. On the appraisal time, we assume that the above data

is real and effective and there is none disputes in the ownership and debts about the

subject property.

III. Non-considered factors and special adjustments in the report

1. The results of the appraisal are taken for reference as the market price under this

appraisal purpose. Changes in national macroeconomic and social policies and force

majeure, are not taken into consideration for valuation conclusion. Make no

consideration about the additional price of the special purchaser, or special trade

condition. If the conditions change, the appraisal value will be different accordingly.

2. The appraisal is base on the open market price. We make comparison with the

normal price of the similar real estate on the appraisal time and make no consideration

about the mortgage, debts, rent and other rights limitations and make no consideration

about the risks on the market changes in the future. The transaction taxes are also not

taken into consideration.

IV. Restriction of the appraisal

1. The appraisal result shall remain effective within one year since the finalization

of the report, that is, from May 3rd, 2013 to May 2nd, 2014. After the period, or when the

fast changes of property market price come forth, the report users should adjust the

appraisal result in time.

2. In the appraisal report, the technical report attached is only kept as a file by our

company and kept for the check-up by the administration bureau in charge, which will

not be applied when use.

3. The appendices shall be effective when used with the report contents altogether.



Report of Appraisal Conclusion

Xiamen Da Xue Assets Appraisal Co., Ltd. accepts the appraisal consignation of Ideal Jacobs (Xiamen) Corporation In accordance with the code for Real Estate Appraisal

of P.R.C and relevant rules and regulations, and following the acknowledged appraisal

methods and principles of objectivity, independence, fairness and science, the appraisers

have appraised the industrial property which is located on the Floor 4, Block D, Gangxia

Industry Park, 319 East Hubin Road, Xiamen, Fujian, China. The certified real estate

appraiser, following the standard appraisal procedure, has carried out the on-site

inspection, market survey and property appraisal, and obtained the results of the fair

value of the appraisal subject on appraisal date May 2nd, 2013. The report of appraisal

conclusion is as follows:

I. Consignor：

Consignor：Ideal Jacobs (Xiamen) Corporation

Company Add.：Floor 4, Block D, Gangxia Industry Park, 319 East Hubin Road,

Xiamen, Fujian, China.

Legal Representative：Meng Bin

II. Appraisal Party

Consignee：Xiamen Da Xue Assets Appraisal Co., Ltd.

Business Lisence No.：350200200034023

Legal Representative：Li Yi Feng

Company Add.：Unit 2, 3, 4, 6, 8, 10, on 6th floor of Kaixuan Building at No. 63

Jinbang road in Si Ming District of Xiamen city

Appraisal Qualification Grade：First-rate

Appraisal Qualification Certification No.：2013011

Appraisal Qualification Approval No.：Fujian real estate [2001] 5

Tele：（0592）5804752

Fax：（0592）5804760



III. Appraisal Subject

The subject property is located on Floor 4, Block D, Gangxia Industry Park, 319

East Hubin Road, Xiamen, Fujian, China. Details descriptions are in the following status

description, district factors, on-site inspection status, and right status of the property.

（I）、Property basic status description：

Property Name Gangxia Industry Park

Location Floor 4, Block D, Gangxia Industry Park, 319 East Hubin Road, Si

Ming District

The four boundaries of the

land

East Hubin East Road South Xiaxin garden

West Jinqiao Road North Xianyue Road Property owner Ideal Jacobs (Xiamen) Corporation Legal usage Industrial Real usage Industrial

Type of right to use land Transfer Left years of land

use rights 28 years

（II）、District factors：

Location

Located at the south of Xianyue road and at the west of Hubin east

road. The location is fine and there are many house buildings and

industrial and commercial buildings nearby, such as the Boshi

building, Yueyang housing estate, Xiaxin garden, Binbei

automobile town, and so on. The residential aggregation degrees

are high but the industrial aggregation degrees are in general.

Location Map

The subject property



Traffic conditions

In the district, there are Xianyue road, Hubin east road, Jinqiao

road, and other primary and secondary roads. Good routing

network with great road accessibility. There are the buses of no.

80、847、9、16、97、20、126 and other buses and minibus passing

by. There is no traffic line control in the area, and the conditions of

traffic lines are much higher.

Surroundings Good road planting design and good residential environment.

Facilities Complete facilities with water, electricity, road, kindergarten, schools, markets, banks, mail bureaus, shopping malls, restaurants, hospitals and bus stops and so on.

（III）、On-site inspection status of the property

On-site inspection of the

building

The building is a factory building with 6 floors in steel and

concrete structure. It is built in 1995. The outside wall is in paint.

The anti-theft intercom system is in normal use. The floor of the

building is paved in tiles. The inner walls are paved in tiles. The

ceilings are in paint. The floors in stairway are paved in tiles. The

subject property is located on the 4th floor of the D building with

good lighting and ventilation.

Property management Semi-closed property management

Residential environment Green areas, good environment

Property layout Height between floors is about 3.6 meters. Good and reasonable

inner layout.

Inner decoration: Glass entrance door and aluminium alloy window; in most areas, tiles paved in

the floor, and plastic covered in some part of floor, inner walls in paint, and plastic suspended

ceilings. In the bath room, tiles paved in the floor and walls, plastic suspended ceilings. On

appraisal date, The property is in good facilities with water and electricity and in normal use.

On-site inspection pictures



Non depreciation rate

The property is in good facilities with water and electricity. And in normal use. Based on the completion year, durable year, use status and on-site inspection, the non-depreciation rate is determined as 85%.

（IV）The registered status of property in ownership certificate：

The registered status of property in

ownership certificate

Location Floor 4, Block D, Gangxia Industry Park, 319 East Hubin Road, Si

Ming District

Property Ownership

Certificate No. Certificate of Xiamen Land & Property（X. L. P. C. No. 00605419）

Property owner Ideal Jacobs (Xiamen) Corporation

Type of right to use

land Transfer

Source of

ownership Owner rename in 2007

Land area 21960.4 sq. m. Right to share

land area 879.91 sq. m. on survey

Year of completion In 1995 Covered area 2734.58 sq. m.

Drawing No. 7500-4300 Land No. 4528-2



Structure In steel and

concrete

Total floor

number 6 floors

Legal Usage Industrial Real Usage Industrial Validity of the land

use rights From Sept. 24th, 1991 to Sept. 24th, 2041

Mortgage Based on the materials supplied the consignor, the property has

been mortgaged for loan on the appraisal time.

IV. Purpose of Appraisal:

This appraisal is to know the value of the assets on transferring based on the open

market price for the consignor’s reference. The appraisal will not be used in other

purpose.

V. Appraisal Date: May 2nd , 2013

VI. Value Definition：

1. The appraised property is located on Floor 4, Block D, Gangxia Industry Park,

319 East Hubin Road, Xiamen, Fujian, China. Both the legal usage and real usage of the

land are industrial. The type of right to use land is transfer and the validity of the land use

rights is till Sept. 24th, 2041. Since the appraisal time, there are still 28 years left for the

use of land rights and still 32 years left for the economic building life.

2. Appraisal Date: May 2nd, 2013

3. Appraisal purpose: This appraisal is to know the value of the assets on transferring

based on the open market price for the consignor’s reference.

The appraised value is satisfied with the above appraisal conditions.

VII. Appraisal Basis：

（I）Gist of relevant laws, rules and policy documents of this appraisal

1、Land Management Law of the People’s Republic of China (implemented as from

Jan. 1, 1999)

2、Urban Real Estate Management Law of the People’s Republic of China

(implemented as from Jan. 1, 1995)

3、Fujian Province Real Estate Price Appraisal Management Method (implemented



as from Jun. 23, 1998)

4、Notice of Standard Land Price in Xiamen Urban issued by People’s Government

of Xiamen City ( Xiamen Gov. No. [2007]314 )

Xiamen Land Price Collection Rules ( Xiamen Gov. No. [2007] 315 )

5、Some Provisions of the Supreme People’s Court on the Appraisal and Auction

Entrusted by Court (Court Explain No. [2011] 21)

6、Implementation Regulations of the Fujian Provincial High Court on the Appraisal

and Auction by Court (Fujian High Court No. [2012] 335)

（II）Appraisal code and standards in this appraisal

1、The GB/T 50291-1999 Code for Real Estate Appraisal of P.R.C

2、Valuation of Urban Land in National Standards GB/T18508-2001

3、The Housing Damage Rating Criteria issued by Ministry of Construction

（III）Relevant materials provided by the consignor

1、Certificate of Xiamen Land and Property (X. L. P. C. No. 00605419)

（IV）Files collected by the consignee

1、Loan rates on the appraisal date

2、The on-site inspection records

3、Some inquiries performed and parameter data and other relative materials

collected by Xiamen Da Xue Assets Appraisal Co., Ltd.

VIII. Appraisal Principle：

1、Principle of legality

The real estate appraisal shall be conducted on the basis of the legal proprietorship

of the real estate, which contains the legal obtainment, legal use, legal transaction or

disposition, etc.

2、Principle of Maximal and Optimal Use

The appraisal of the real estate shall be based on the maximal and optimal use. The

maximal and optimal use means enabling the appraised object to generate the maximal



value legally allowed, technically possible, economically feasible and after reasonable

argument.

3、Principle of Replacement

The appraisal result shall not deviate from the normal price of similar property

under similar conditions obviously.

4、Principle of Appraisal Time

The appraisal result is the objective and reasonable price or value of the appraised

object at the appraisal time.

IX. Appraisal Method：

The common methods of appraisal are market comparison method, income method,

cost method, and hypothetical development method. Market comparison is adopted when

there are many similar transactions. The income method is adopted when the income or

potential profit is available. The cost method is used when the market transactions are

rare so as that the market method, income method, or hypothetical development method

can’t be adopted as usual. The hypothetical development method is used when the

property has potential investment benefits. Two and more methods should be adopted in

the appraisal report for the subject property.

This appraisal is to know the value of the assets on transferring based on the open

market price for the consignor’s reference. Considering the characters of the subject

property, and the costs and tax data which the appraisers obtained, the appraisers use the

cost methods and income methods in the appraisal. The land value is appraised by the

method of standard land modification method.

The cost method is based on the total necessary building costs or expenses for the

object property or similar property, while plus a normal profit and taxable payments to

determine the replacement cost valuation of the object property, and after deducting the

property depreciation so as to estimate the objective and reasonable price or value of the

subject real estate.

The income method is to anticipate the normal net profit of the appraised object in

the future and choose suitable capitalization rate to discount such profit to appraisal time

for accumulation, in order to estimate the objective and reasonable price or value of the

subject real estate.

X. Appraisal Conclusion：


Xiamen Da Xue Assets Appraisal Co., Ltd. page 16

Appendices

1. Certificate of Xiamen Land and Property (X. L. P. C. No. 00605419) (Photocopy)

2. Qualification Certificate of Appraisal Institute Qualification (Photocopy)

3. Business License of the Appraisal Institute (Duplicate in photocopy)

4. List of appraisers and Certificate of Registered Real Estate Appraisers (Photocopy)

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