27 Investment properties

 

		2020		2019
		AED’000		AED’000
At 1 January		7,925		79,478
Acquisition of investment properties in respect of settlement of a loan		–		3,604
Reclassified to Property, fixtures and equipment		–		(75,000)
Change in fair value		–		(157)
		————————		————————
At 31 December		7,925		7,925
		=============		=============

 

Investment properties comprise: 3 apartments located in Dubai Business Bay with a market value of AED 4,425 thousand (2019: AED 4,425 thousand) and a villa in Green Community, Dubai with a market value of AED 3,500 thousand (2019: AED 3,500 thousand)

An independent valuer for the valuation of this investment property adopts the comparable market value method in valuing the investment properties. This method calculates the value of the property by taking the market valuation of comparable properties, which reflects market sentiment and situation. The prime location, maintenance and occupancy levels are also considered.

The net rental income recognised is AED 403 thousand (2019: AED 465 thousand) and is recognised in the consolidated income statement under ‘other operating income’.

The fair value measurement for all the investment properties has been categorized as a level 3 fair value based on the inputs to the valuation technique used.