86
Hong Kong Ferry (Holdings) Company Limited Annual Report 2013
Notes to the Accounts (Continued)
13
FIXED ASSETS (Continued)
(a)
Fair value measurement of investment properties (Continued)
(ii)
Information about Level 3 fair value measurements
The fair values of investment properties were determined using income capitalisation approach which
capitalised the net income of the properties and taking into account the reversionary potential of
properties after expiry of the current leases except for an investment property which was determined
using market comparison approach by reference to recent sales price of comparable properties on a
price per square foot basis using market data which is publicly available.
Below is a table which presents the significant unobservable inputs:
Income capitalisation approach
- Retail
- Car park
Market comparison approach
- Godown
Range of
capitalisation rates
%
Range of occupancy rates
%
4.25% -5.5%
4.75% 6.5%
60% - 100%
-
76% - 100%
Market unit
sales price HK$/sq. ft.
424 - 429
The fair value measurement of investment properties is positively correlated to the occupancy rate and market unit sales price and negatively correlated to the capitalisation rate.
The movements during the year in the balance of these Level 3 fair value measurements are as follows:
Investment properties
At 1 January 2013
Disposals
Valuation gains
At 31 December 2013
HK$'000
1,182,800
(24,000)
93,100
1,251,900