Aviva 2009 Annual Report Download - page 189

187
Performance review
Aviva plc Notes to the consolidated financial statements continued
Corporate responsibility
Annual Report and Accounts 2009
Governance
Shareholder information
Financial statements IFRS
Financial statements MCEV
Other information
21 – Investment property
This note gives details of the properties we hold for long-term rental yields or capital appreciation.
Freehold Leasehold Total
£m £m £m
Carrying value
At 1 January 2008 12,603 2,788 15,391
Additions 1,744 2 1,746
Capitalised expenditure on existing properties 92 8 100
Acquisitions of subsidiaries 81 — 81
Fair value losses (2,441) (696) (3,137)
Disposals (852) (297) (1,149)
Transfers (2) 2 —
Foreign exchange rate movements 1,276 118 1,394
At 31 December 2008 12,501 1,925 14,426
Additions 319 49 368
Capitalised expenditure on existing properties 64 9 73
Fair value losses (917) (167) (1,084)
Disposals (785) (143) (928)
Transfers from property and equipment (note 20) 28 35 63
Foreign exchange rate movements (453) (35) (488)
At 31 December 2009 10,757 1,673 12,430
Less: Amounts classified as held for sale — (8) (8)
10,757 1,665 12,422
Investment properties are stated at their market values as assessed by qualified external valuers or by local qualified staff of the
Group in overseas operations, all with recent relevant experience. Values are calculated using a discounted cash flow approach and
are based on current rental income plus anticipated uplifts at the next rent review, assuming no future growth in rental income.
This uplift and the discount rate are derived from rates implied by recent market transactions on similar properties.
The fair value of investment properties leased to third parties under operating leases at 31 December 2009 was
£11,750 million
(2008: £13,764 million, 2007: £14,616 million) . Future contractual aggregate minimum lease rentals receivable
under the non-cancellable portion of these leases are given in note 52(b)(i).
Financial statements IFRS