Assess the value of a specialised industrial building using the cost approach. The $1471\mathrm{.}6$ sqm building is $12\mathrm{.}4$ years old and was constructed using an aluminum composite cladding that is no longer used. To reproduce the building would cost $$2000/$sqm but the cost to replace the building with a modern equivalent would be $$952\mathrm{.}7/$sqm$.$

The building sits on a $3748\mathrm{.}3$ sqm site, and this was purchased $12\mathrm{.}4$ years ago for $$802339\mathrm{.}6.$ The current average price for industrial sites sold in the area over the last $6$ months is $$3,100,000$ and this is based on the following $3$ sales of vacant industrial land.

Sales Site Area Price

Sale $12350$ sqm $$2,600,000$

Sale $24000$ sqm $$3,300,000$

Sale $33500$ sqm $$3,400,000$

You should use straight$-$line depreciation at a rate of $4\%$ pa$.$

Your estimate will require a number of judgments. You need to explain each of these judgments in your argument for the value.

Your Excel workings and argument will make up the majority of the marks but also enter your estimated value into the question box. You should complete your work using Excel in the file provided.