[2023] UKUT 217 (LC)

The leisure property experts did not agree on the value of the Cheshire Lounge to the hospitality market on 10 November 2014. Mr Hunter considered that with the original access over the reference land the whole site was worth £1.34 million. With a legal right of access over the new route over land belonging to the Tatton Estate it would be worth the same. Without a legal right of access it was of no value, except to the adjoining owner. Mr Hunter left the assessment of compensation to Mr Cook. Mr Owens valued the site at £1.05 million with the original access and at £945,000 with the new access (assuming that the site had the benefit of the easement negotiated between National Highways and the Tatton Estate and offered to the claimant on 30 June 2022).

Somewhat surprisingly Mr Hunter adopted a comparative approach to his valuation, eschewing the usual residual method which might have been thought appropriate for a site which is known to have been purchased for development. He relied on his previous involvement with Marston’s which had been very acquisitive in 2014, purchasing sites, developing them to its own specifications and then arranging sale and leaseback transactions to release funds for further acquisitions and developments.

Mr Hunter analysed the purchase prices paid by Marston’s on its acquisition of nine different sites. It was not clear whether he had been personally involved in these transactions. He had not sought his former client’s permission to provide details and commercial confidentiality limited the information he was prepared to disclose, notwithstanding that the transactions were historic. The information he did make available was very limited, and the usefulness as comparables was negligible. Nevertheless, we set out all the information he provided in the following table:

Details of the individual locations were not provided but we were told they included, amongst others, Hertfordshire and Devon as well as sites closer to the northwest. We were given no information about access, topography or the planning status of the sites. It would have been helpful to have known about the ownership, tenure and restrictions on the use of the sites but these particulars were also withheld.

Mr Hunter acknowledged that all of these sites were much smaller than the Cheshire Lounge site, with even the largest being over an acre smaller. He had not applied any weighting to the transactions or made any adjustments for factors that might influence value. He simply averaged the purchase price per acre to arrive at a figure of £780,000 per acre. He then excluded the lowest and highest results which produced a figure of £740,000 per acre. It was not apparent why this second analysis had been carried out and he did not make any use of it.

Mr Hunter considered that the proposed restaurant on the Cheshire Lounge site would occupy about 1.5 acres which would leave an area of 2.13 acres for future expansion (which he valued at 10% of the rate for the area earmarked for initial developed). Adopting his average rate per acre from all nine anonymised transactions his valuation of the site was as follows: