EFTA SURVEILLANCE AUTHORITY DECISION

No 343/09/COL

of 23 July 2009

on the property transactions engaged in by the Municipality of Time concerning property numbers 1/152, 1/301, 1/630, 4/165, 2/70, 2/32

(Norway)

THE EFTA SURVEILLANCE AUTHORITY (1),

Having regard to the Agreement on the European Economic Area (2), in particular to Articles 61 to 63 and Protocol 26 thereof,

Having regard to the Agreement between the EFTA States on the Establishment of a Surveillance Authority and a Court of Justice (3), in particular to Article 24 thereof,

Having regard to Article 1(3) of Part I and Articles 4(4) and 7(2) of Part II of Protocol 3 to the Surveillance and Court Agreement (4),

Having regard to the Authority‘檚 Guidelines on the application and interpretation of Articles 61 and 62 of the EEA Agreement (5), and in particular the Chapter relating to State Aid Elements in Sales of Land and Buildings by Public Authorities,

Having regard to the Authority‘檚 Decision of 14 July 2004 on the implementing provisions referred to under Article 27 of Part II of Protocol 3 (6),

Having called on interested parties to submit their comments pursuant to those provisions (7), and having regard to their comments,

Whereas:

I. FACTS

1. PROCEDURE

On 3 March 2007, the Authority received a complaint from an association named Aksjonsgruppa ‘楾a vare p氓 trivelige Bryne‘� concerning the sales of property numbers 1/152, 1/301, 1/630, 4/165 in Time Municipality by the municipal authorities to two different private entities, as well as the sale of title number 2/70 (Bryne stadium which also includes title number 2/32) by Bryne fotballklubb, previously given to the club by the municipality, to a private investor (Event No: 414270). By letter dated 9 May 2007, the private investor Mr Gunnar Oma sent a complaint to the Authority concerning the sale by Time Municipality of one of the abovementioned properties, i.e. number 4/165.

After an exchange of correspondence and information with the Norwegian authorities (8), on 19 December 2007 the Authority decided to open the formal investigation procedure on the sale of the land plots mentioned above. The Authority‘檚 Decision No 717/07/COL to initiate the procedure was published in the Official Journal of the European Union and in the EEA Supplement hereto (9).

The Norwegian authorities had commented on the opening decision by letter dated 21 February 2008 (Event No 466024). The Authority called on interested parties to submit their comments. The Authority received comments from two interested parties (10). By letter dated 24 July 2008, (Event No 485974), the Authority forwarded these to the Norwegian authorities. By letter dated 13 August 2008 (Event No 488289), the Norwegian authorities notified the Authority that they had no further comments.

2. DESCRIPTION OF THE TRANSACTIONS UNDER SCRUTINY

2.1. THE SALE OF TITLE NUMBERS 1/152, 1/301 AND 1/630 TO GRUNNSTEINEN AS

By a sales agreement dated 25 August 2007 (11), Time Municipality sold property title numbers 1/152 (1 312 square metres), 1/301 (741 square metres) and 1/630 (1 167 square metres) in the centre of Bryne, the municipal centre of Time Municipality, to the private property developer Grunnsteinen AS. According to the explanations provided, the initiative to enter into the agreement appears to have been taken by the buyers, and no public bidding round was organised prior to the sale (12). Grunnsteinen did not pay anything for the property but engaged to build a total of 65 parking spaces as replacement for ordinary payment for the property (13). Clause 7 of the Grunnsteinen agreement) provided that the titles to the property should only be transferred upon completion of the parking spaces, at the latest by the end of 2008. Furthermore, Clause 1 stipulated that the underground car park would be registered as a separate title in the land register when re-transferred to Time Municipality.

Clause 1 of the contract (14) states that the properties, at the time of entering into the contract, were zoned for residential and public road/parking purposes.

Under Clause 1 of the contract, Grunnsteinen AS undertook to build underground parking spaces on title number 1/152, of which 65 were to be transferred to Time Municipality upon completion (clauses 1 and 5 of the agreement). According to the municipal authorities, the payment for title number 1/152 consisted of the 44 parking spaces on the property being compensated for in the underground car park. As for title numbers 1/301 and 1/630, the municipality had commissioned a value assessment of one of the properties, title number 1/630, which the municipality claims were assessed by Eiendomsmegler 1. The assessment of title number 1/630, which concluded that the market value was NOK 600 per square metre, was presented to the Authority prior to the opening of the formal investigation procedure (15). In reply to the Authority‘檚 requests, the Norwegian authorities initially presented calculations made by the construction firm Skanska Norge AS, showing that the price for a parking space in an underground car park would be approximately NOK 150 000, excluding VAT and costs of buying/renting the land (16). On the basis of these estimates, the Norwegian authorities claimed that the market price for title numbers 1/301 and 1/630, based on the value assessment, would be NOK 2 516 400 (17), whereas the value of the additional 21 parking spaces which Grunnsteinen had undertaken to build for the municipality was estimated to NOK 2 625 000 (18). Thus, the value of these two properties would be fully compensated by Grunnsteinen through the construction of 21 additional parking spaces.

In reply to the Authority‘檚 information injunction in the decision to open the formal investigation procedure, new value assessments of the property, as well as estimates of the price of the car park, have been submitted (19). The new value assessments were carried out by the asset valuation firm OPAK. Based on the land cost method (20), OPAK arrived at a market value of NOK 3,2 million for the properties sold en bloc. According to OPAK, the house on title number 1/301 is condemned and will have to be demolished, thus representing an encumbrance on the property. The demolition costs are estimated to NOK 150 000. The OPAK assessment also includes cost estimates for the parking spaces. Based on a minimum of 25 square metres per parking space (as required by government regulations) and building costs of NOK 5 200 per square metre (based on experience), OPAK arrives at a price of NOK 130 000 per parking space, or NOK 8 450 000 for 65 parking spaces.

2.2. THE SALE OF TITLE NUMBER 4/165 TO BRYNE INDUSTRIPARK AS

On 31 August 2005, Time Municipality and the private property developer Bryne Industripark AS signed a sales agreement concerning title number 4/165 at H氓land in Time (21). The title comprised 56 365 square metres of industrial land, and the sales price was set at NOK 4,7 million (or approximately NOK 83 per square metre). At the time of the signing of the agreement, the area was zoned for industrial purposes but the detailed zoning plan was not adopted due to objections from the Public Road Administration. The contract contains a claw-back clause (Clause 7) for Time Municipality in the event that the property has not been built on or put to use 5 years after the date of taking possession.

At the time of entering into the agreement, the property consisted of undeveloped land. In the memorandum for the municipal council which approved the agreement, the municipal administration states that the conclusion of a development agreement should be a condition for selling the land. According to the municipal authorities, the new detailed zoning regulations were adopted on 30 August 2007, under which the property was zoned for sports purposes (22). The sales agreement stipulated that a development agreement must be concluded on the basis of the zoning regulation. The Norwegian authorities, at the time of commenting the opening decision, submitted an estimate of the development costs commissioned from the consultancy firm Asplan Viak and an offer for the ground works submitted by a local builder (23).

The municipality confirms that no public bidding round was organised prior to the sale, which came about following an initiative from the buyer, but claims that the land was advertised on its web page in 2003-2004. It follows from the administrative memorandum made prior to the sale that the price charged was based on the price at which Time Municipality bought the property in 1999, to which capital costs, regulatory work and administrative costs were added. The price was, thus, established in accordance with the municipality‘檚 general principle for the sale of industrial properties, i.e. selling at cost (24).

The complainant has alleged that the price for this type of property should be in the range of NOK 400 per square metre, based on a valuation purportedly carried out by an independent asset valuer in January 2007 (25). However, no documentation has been submitted to this effect. The municipal authorities have been claiming that the market price would be in the range between NOK 80 and 115 per square metre in the area, based on sales of similar properties between private parties in the region (26). In reply to the Authority‘檚 information injunction in the decision to open the formal investigation procedure, the Norwegian authorities have submitted a value assessment carried out by OPAK. OPAK‘檚 assessment concerns the land as zoned at the time of the contract, i.e. for industrial purposes and not for sports purposes, in accordance with the later zoning regulations. The assessment is not based on the exploitation method, but on the sales value, defined as ‘the price that several independent interested parties are thought to be willing to pay at the valuation date‘� In the case at hand, this price has been established with reference to sales prices obtained for ‘榗omparable properties in the area‘� The assessment concludes that the market price cannot be established with certainty, but that it would likely be in the range of NOK 80 to 100 per square metre.

2.3. THE SALE OF TITLE NUMBERS 2/70 AND 2/32 TO BRYNE FOTBALLKLUBB

2.3.1. The sales agreement

By agreement dated 8 August 2003 (27), Time Municipality transferred the title to Bryne stadium, title numbers 2/32 and 2/70, an area of approximately 53 000 square metres, to Bryne fotballklubb (Bryne FK) (28). The buildings on the land (including the football stand) already belonged to the football club and ground lease agreements were in place (29). One building not belonging to Bryne fotballklubb appears to remain on the land, and it was foreseen that the club would take over the municipality‘檚 rights under the lease agreement with the owner of the building (30).

Under Clause 2 of the Bryne agreement, title numbers 2/32 and 2/70 are transferred to Bryne FK without remuneration. Furthermore, the municipality covered all costs connected to the transfer of the property, such as parcelling, measuring etc. The titles comprise approximately 53 000 square metres, and the agreement expressly provided that it should, primarily, be used for sports purposes.

It follows from Clause 1 of the agreement that the football club had requested the titles to the land to be transferred. The purpose was to increase the club‘檚 assets, in order to allow it to upgrade the football pitch in compliance with applicable requirements for pitches to be used in Tippeligaen (the Norwegian Premier League). The memos drawn up by the municipality indicate that it was essential to the club to be able to pledge the property as collateral for debts, although its value was likely to be reduced through the contract provision that it may only be used for sports purposes.

In reply to the Authority‘檚 information injunction in the decision to open the formal investigation procedure, the Norwegian authorities have provided a value assessment of the stadium land as it stood at the time of transfer. The assessment was carried out by OPAK. OPAK arrives at a sales value of NOK 2 650 000, based on an assessment of the land as land to be used for sports facilities.

The complainant has claimed that Bryne FK, in 2007, planned to sell the stadium to Forum J忙ren for NOK 50 million. A new stadium was to be built at H氓land, on land bought from Bryne Industripark AS (as referred to above). In reply to the Authority‘檚 request for information, the Norwegian authorities confirmed that a letter of intent had been signed between Bryne FK and Forum J忙ren concerning title number 2/70, but were unable to produce a copy thereof. However, in 2008, these transactions seem to have been reversed as the construction costs for the planned stadium at H氓land turned out to be significantly higher than expected (31).

2.3.2. Bryne FK

The recipient of the land, Bryne FK, is a local football club, currently playing in the so-called ‘楢decco League‘�(1st division). Bryne FK is registered in the company register as a non-profit organisation (32), but the football club has also set up a limited company, Bryne Fotball AS.

According to the information provided by the Norwegian authorities (33), in 2001 the club and the limited company entered into a cooperation agreement based on a standard agreement elaborated by the Norwegian Football Association for cooperation between the commercial and non-commercial divisions of a team. Under the terms of the agreement (34), the limited company, named Bryne Fotball ASA at the time, was in charge of the following economic activities: sponsorship agreements, the sale of media and television rights and advertising space, the sale and licensing of supporter paraphernalia, the use of coaches and players for advertising purposes, commercial exploitation of the club‘檚 name and logo, ticket sales for the club‘檚 home matches, and contracts concerning bingo operations. Bryne FK, on the other hand, was responsible for all sports related matters such as training and the selection of teams, the calendar of matches and the matches as such, travel arrangements for players, rights and obligations vis-脿-vis players, members, other organisations and government agencies, as conferred on the club by the regulations and by laws of the sports associations, membership fees and minor commercial activities such as raffles organised during matches, and the operation of the stadium.

Under the cooperation agreement Bryne Fotball ASA was financially responsible for the players (35). Furthermore, Bryne Fotball ASA paid the purchase price for players, or, alternatively, a price to Bryne FK when a player was promoted to the elite team from one of the club‘檚 junior teams. The limited liability company would also keep the net profits when these expenses were paid. Finally, the limited liability company paid a fee of NOK 150 000 to Bryne FK per year for renting the stadium, as well as NOK 10 000 per official football match, and a price for media rights, sponsorship rights, etc.

However, in order to comply with NFF‘檚 general rules, the players‘�employment contracts were formally entered into by Bryne FK, and the club was also, formally, the party to contracts concerning the sale, purchase and hiring of players. In addition, the club was responsible for the management of a purely sporting nature (such as training, selection, etc.).

In spring 2004, the club and the company re-organised. All activities in Bryne ASA were transferred to Bryne FK, and Bryne Fotball ASA changed company status and became Bryne Fotball AS, whose only purpose was paying off debts. The debts seemed to have been paid in 2006 (36). Thus, currently, all activities, economic or not, are carried out within Bryne FK.

3. COMMENTS BY THE NORWEGIAN AUTHORITIES

The Norwegian Government has submitted comments to the decision to open the formal investigation procedure.

3.1. COMMENTS TO THE SALE OF TITLE NUMBERS 1/152, 1/301 AND 1/630 TO GRUNNSTEINEN AS

With their comments, the Norwegian authorities also submitted a value assessment of the property, including a valuation of the price of the underground parking spaces.

The Norwegian authorities take the view that the property was not given away without remuneration; the municipality was remunerated through the construction of the underground car park. Thus, there would be no State aid if the cost of the construction of the parking spaces corresponds to at least the value of the properties transferred to Grunnsteinen AS.

In that respect, the Norwegian authorities point to the value assessment carried out by OPAK, arriving at a value in the range of NOK 4 510 000 to NOK 5 636 000 for the properties transferred to Grunnsteinen, taken as a whole. Furthermore, OPAK estimates the cost of construction of the parking spaces in the underground car park to around NOK 8 450 000, based on experience from similar projects, which is normal industry practice. The Norwegian authorities also point out that the construction company Skanska, on the same basis, estimated the construction costs of one parking space to NOK 150 000, or NOK 9 750 000 for 65 parking spaces.

Based on these figures, the Norwegian authorities submit that the cost of the car park more than offsets the value of the property, and, thus, that no State aid is involved.

3.2. COMMENTS TO THE SALE OF TITLE NUMBER 4/165 TO BRYNE INDUSTRIPARK AS

As regards the sale of title number 4/165 to Bryne Industripark AS, a value assessment carried out by OPAK has, again, been submitted. The Norwegian authorities have pointed out that OPAK has assessed the land in accordance with applicable regulations at the time, i.e. undeveloped land reserved for industrial purposes in the general municipal plan, but not subject to a detailed zoning plan. The Norwegian authorities submit that it is immaterial that a proposal for a detailed zoning plan had been submitted and later withdrawn, and that the area was later rezoned for sports purposes, as long as there was no applicable zoning plan at the time of the transaction.

Against this background, the Norwegian authorities underline that the price actually paid by Bryne Industripark, NOK 4 700 000 (corresponding to NOK 83 per square metre), falls within the acceptable price range according to OPAK‘檚 value assessment, i.e. NOK 4 510 000 to NOK 5 636 000 (or NOK 80 to 100 per square metre). Acknowledging that the price paid is in the lower range of the acceptable price interval arrived at by OPAK, the Norwegian authorities nevertheless submit that no aid can be involved as long as the price paid does not significantly deviate from the estimated values, as the value of undeveloped land which is not subject to a zoning plan is, in any event, uncertain.

3.3. COMMENTS TO THE SALE OF TITLE NUMBERS 2/70 AND 2/32 TO BRYNE FK

With respect to the sale of title numbers 2/70 and 2/32, the Norwegian authorities have argued that the first question to be assessed is whether an economic advantage was granted to Bryne FK through the transaction. In the enclosed value assessment, OPAK has estimated the value of the property on which the stadium is built to being in the range of NOK 2 385 000 to NOK 2 915 000. As no remuneration was paid for the property, the Norwegian authorities acknowledge that Bryne FK has received an economic advantage corresponding to the value of the property, as established by OPAK.

Notwithstanding the advantage granted to Bryne FK, the Norwegian authorities submit that the transaction did not involve aid within the meaning of Article 61(1) of the EEA Agreement. In their opinion, Bryne FK, at the time of the transaction, was not an undertaking within the meaning of the EEA State aid rules. This point of view is based on the club‘檚 organisational structure at the time of the transaction: At that time, Bryne FK was only engaged in non-commercial and non-professional activities, whilst the commercial activity and the economic risks and benefits related to the club‘檚 professional football team took place within Bryne Fotball ASA.

As for any possible State aid to Bryne Fotball ASA, Norway claims that this was excluded through the terms of the cooperation agreement. According to the agreement, Bryne Fotball ASA was required to pay an annual fee of NOK 150 000 to Bryne FK for the use of the stadium, plus NOK 10 000 per official match. Thus, the agreement would ensure that the economic advantage resulting from the transfer of the land would benefit Bryne FK exclusively.

With regard to the merger of Bryne Fotball ASA and Bryne FK, which took place around half a year after the transfer of the property, the Norwegian authorities submit that it cannot be assumed that, as a result of the merger, the advantage granted by the municipality will automatically accrue proportionately to the commercial activities of the club. Instead, the current economic activities must be analysed in detail in order to establish a distribution key between the economic and non-economic activities.

4. COMMENTS BY THIRD PARTIES

4.1. COMMENTS BY BRYNE FK

Bryne FK has provided comments concerning the transfer of the property and the club‘檚 organisational structure and activities.

The club explains, in line with what has been set out above, that its organisational structure changed when Bryne FK and Bryne Fotball ASA merged in 2004. Currently, all activities take place within Bryn FK. However, the club has entered into a back-to-back agreement with the company Klubbinvest AS, which bears the financial risk for the contracts with the professional footballers.

Furthermore, the club points out that it had negative results in 2005, 2006 and 2007, and that the main part of its activities is non-commercial, primarily related to young football players. Of a total number of 2 047 hours of activity in the club (37), the economic activity only accounts for around 230 hours, or 11 per cent of the total. All non-economic activities take place on the facilities located on the land transferred to the club through the agreement dated 2003.

As regards the transfer of the title to the stadium premises, the club underlines that only the land was transferred in 2003, as the club already owned the buildings and facilities. Moreover, the club refers to a lease agreement entered into by Time Municipality, in its capacity as the former owner of the property, whereby a certain area on the transferred land is reserved for parking for a period of 99 years. The club takes the view that the long term lease agreement significantly reduces the value of the property, and that this was not taken into account by OPAK.

In the view of the club, Bryne FK was not an undertaking at the time of transfer of the land, due to the organisational structure at that time and the cooperation agreement, described above. As the question of aid should be assessed at the time of transfer, no State aid is involved. As for the value of the property, the club notes that, due to the negative value of the lease contract reserving parts of the land for parking, the real value of the transferred land is significantly lower than what OPAK concludes. Therefore, should the Authority conclude that the transfer does entail aid, any aid element may, therefore, be de minimis.

4.2. COMMENTS BY THE FOOTBALL ASSOCIATION OF NORWAY

The Norwegian Football Association (NFF) has submitted comments pertaining to the organisation of Norwegian football in general, while refraining from specifically commenting the case at issue.

The association explains that it is one of Norway‘檚 largest non-profit organisations, counting more than 500 000 members, including 400 000 active football players. Recruitment and development of players at all levels is the core activity of the association.

NFF, therefore, endeavours to ensure that adequate facilities exist throughout the country.

NFF points out that, in principle, it is a public responsibility to offer and organise sports activities for children and young people in their local environment. Thus, the construction of new facilities requires the contribution of the sporting community as well as of the public authorities. In reality, NFF believes that the clubs‘�contribution to the public task is quite substantial, although it has never been quantified. An additional benefit of its efforts towards children an youth is the creation of a channel for mobility between grassroots football and professional football. Solidarity with local clubs is always an important objective, even when revenues are generated through the sale of media rights at the national or European level.

4.3. COMMENTS BY V脜LERENGA FOTBALL

V氓lerenga Fotball, through its legal representative Selmer Law firm, has submitted general comments on the question of transfer of land to football clubs for the purpose of building football facilities. According to V氓lerenga, this issue is of practical importance and is likely to reappear in the future.

Against this background, the club points to 6 issues which may be of importance when dealing with such cases. Firstly, it points to the importance of keeping separate accounts between the commercial and the non-commercial part of the club. Secondly, V氓lerenga claims that a club owning a stadium which is rented out, may still fall outside the definition of an undertaking provided that it only operates as a ‘榩assive owner‘� Thirdly, V氓lerenga takes the view that there is presumption that the construction and operation of football stadiums does not affect trade. Fourthly, it is submitted that football stadiums can be viewed as social infrastructure. Fifth, the market rent for a football stadium should be established on the basis of what buyers are willing to pay, not on the basis of whether the investment will be amortised. Sixth, the obligation to build and operate a football stadium attached to the transferred land has a negative value, which means that there is no economic advantage for the club.

II. ASSESSMENT

1. THE PRESENCE OF STATE AID

Article 61(1) of the EEA Agreement reads as follows:

It follows from this provision that, for State aid within the meaning of the EEA to be present, the following conditions must be met:

Whether these conditions are met must be assessed individually with respect to each of the transactions described above.

2. THE SALE OF TITLE NUMBERS 1/152, 1/301 AND 1/630 TO GRUNNSTEINEN AS

In the decision opening the formal investigation procedure, the Authority expressed doubts as to whether the transaction took place on market terms. The Authority recognised that, as a matter of principle, a transaction whereby the price paid for the property consists of an obligation to construct an underground property for the municipality, may take place on market terms. However, for the Authority to verify that this was the case, a value assessment of the property would have to be carried out and the market price of the construction of parking spaces would have to be established in a reliable manner.

Furthermore, in the opening decision, the Authority pointed out that the value assessment submitted by the Norwegian authorities at that point, which was carried out by Eiendomsmegler 1, only covered one of the titles in question. The Authority also questioned the reliability of the value assessment of title number 1/630, as the assessment did not set out the method applied or mention the characteristics of the property which were decisive for the conclusion.

The Authority also found that the transaction affected trade and competition in the EEA.

Following the Authority‘檚 opening decision, the Norwegian authorities have submitted a new value assessment of the properties, as well as a valuation of the construction costs of the parking spaces, carried out by OPAK. The Authority observes that Grunnsteinen cannot be held to have received any advantage if it can be demonstrated that the value of the property was equal to or lower than the negative value of the obligation to construct the underground car park. In order to examine whether that was the case, it is necessary to assess the reliability of the OPAK report with reference to the method set out in its Guidelines on State Aid Elements in the Sale of Land and Buildings by Public Authorities.

2.1. ASSESSMENT OF THE OPAK REPORT

According to the Guidelines on State Aid Elements in the Sale of Land and Buildings by Public Authorities, the market value of the property should be established on the basis of generally accepted market indicators and valuation standards by an asset valuer of good repute, who should be independent in carrying out his tasks. Finally, the economic disadvantage of special obligations should be evaluated separately and may be set off against the purchase price (38).

The valuation report was carried out by OPAK, a company active in construction management, services to home-owners‘�societies and asset valuation. The report in question was elaborated by Mr Jacob Aarsheim.

The State Aid Guidelines provide that an ‘榓sset valuer‘�is a person of good repute who has obtained an appropriate degree at a recognised centre of learning or an equivalent academic qualification and has suitable experience and is competent in valuing land and buildings in the location and of the category of the asset.

The Norwegian authorities have explained that OPAK, and Mr Aarsheim in particular, have considerable experience in the valuation of properties of this category in the J忙ren area. Their assertions are substantiated by the curriculum vitae of Mr Aarsheim, which has been enclosed to the Norwegian authorities‘�comments to the Authority (39). In addition to extensive experience, Mr Aarsheim is educated in construction technology. Thus, there is no reason to believe that OPAK and Mr Aarsheim do not meet the criteria laid down in the guidelines and are of good repute.

The State Aid Guidelines state that: ‘楾he valuer should be independent in carry out his tasks, i.e. public authorities should not be entitled to issue orders as regards the result of the valuation‘�

The report refers to the purpose of the assessment, the presence of Mr Aarsheim and one other person from OPAK at the time of visiting the property. A detailed explanation on the method applied is also attached. Against this background, the Authority sees no reason to doubt that the asset valuer carried out his assignment in full independence within the meaning of the guidelines.

The guidelines define ‘榤arket value‘�as the ‘榩rice at which land and buildings could be sold under private contract between a willing seller and an arm‘檚 length buyer on the date of valuation, it being assumed that the property is publicly exposed to the market, that market conditions permit orderly disposal and that a normal period, having regard to the nature of the property, is available for the negotiation of the sale‘�

The OPAK report sets out, inter alia, the following bases and assumptions:

As the building on the property is condemned and must be demolished, OPAK has assessed the value of the titles as land not built on. The methodology applied, referred to as the ‘榣and cost method‘� is explained as follows:

‘楾he valuation of property depends on their expected use and development potential, including expected profits. A direct parameter for this is land costs, i.e. the difference between the market value of the fully developed property and total construction including profit margin, but excluding the land cost; divided by the number of square metres of indoor floor area, excluding basements‘�a href="#ntr40-L_2011123EN.01007201-E0040" id="ntc40-L_2011123EN.01007201-E0040" shape="rect"> (40)