Victorian Statutory Revaluation
Valuer-General Victoria and Municipal Group of Valuers
Guidelines on Valuation Methodology for
Outdoor Advertising Signs
Introduction
These guidelines are to be used when valuing Outdoor Advertising Signs (OAS) for rating and
taxation purposes.
The guidelines need to be used in conjunction with the General Provisions for Specialist
Guidelines, which refer to the general requirements, legislation and procedures relating to all
statutory valuations.
Definition
A definition for a Sign is contained in the Victorian Planning Scheme Provisions 1 as follows:
An advertisement and any structure built specifically to support it.
Victorian Planning Provisions Clause 73 Outdoor Advertising Terms lists terms which may
be used in this planning scheme in relation to outdoor advertising.
Industry Terminology
An acceptable classification for Outdoor Advertising Signs (OAS) is summarised below:
Freeway signs or billboards are part of an advertising group that is more commonly known
as ‘outdoor advertising’.
Outdoor advertising is essentially all types of advertising that reaches consumers while they
are outside the home. This is in contrast to broadcast, print or internet advertising, which
may be delivered to viewers out of home but are usually for home or office viewing. Outdoor
products are divided among three primary categories – billboards (large format and posters),
street furniture and transit.
Over the past decade, the shape and form of the outdoor medium has changed. Previously
outdoor advertising was associated with billboards, but now encompasses a wide range of
'out-of-home' formats to reach consumers where they live, work, play, drive, shop and
commute.
Outdoor products come in a number of poster sizes, formats and other configurations. They
can be used to broadcast messages through large format billboards or target specific
audiences, such as shoppers and travellers.
More than 95 per cent of revenue generated from outdoor advertising is covered by one of
the following formats:
Large Format
Super sites and ‘spectaculars’ are the largest of the billboards. Located primarily on
major highways, freeways or principal arterials, they offer high-density consumer
exposure (mostly to vehicular traffic).
1
Victorian Planning Provisions Clause 73 Outdoor Advertising Terms.
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Posters
Posters are another common form of billboard advertising, located mainly in commercial
and industrial areas on primary and secondary arterial roads. Posters are a smaller
format than bulletins and are viewed principally by residents and commuter traffic, with
some pedestrian exposure.
More outdoor campaigns are placed on 24-sheet posters, the traditional billboard, than
any other form of OAS.
At 6.0m x 3.0m, the 24-sheet poster can be found in both city and regional markets. City
sites include major and secondary arterial roads, most railway stations and suburban
commercial areas. In rural markets, sites include highways and key locations within
built-up areas. Many sites are illuminated.
Six-sheet posters, a scaled down 24-sheet poster measuring 3.0m x 1.5m, are also
available in some markets.
Transit
Posters located on buses, trams, taxis etc.
Street Furniture

bus and tram shelters, kiosks, phone booths, seating

internal/external shopping centres

street signs

illuminated street poles
A planning permit is required to use the land for an OAS and a building application is
needed to put up the billboard structure. Approval for a sign is usually a protracted process
depending on the site and the traffic.
The property owner usually receives rent under a leasing agreement that lasts the length of
the approval.
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Additional Victorian legislation and cases applicable to outdoor advertising signs
The following Acts are also relevant to this topic:
 Local Government Act 1989 (Sections 154 and 156)
 Planning and Environment Act 1987
Other relevant material:
The Outdoor Media Association (OMA)
The Outdoor Media Association is the peak industry body which represents most of
Australia's outdoor media display companies and production facilities and some media
display asset owners.
The association operates nationally and prior to July 2005 traded as the Outdoor Advertising
Association of Australia (OAAA). It was first incorporated in 1939.
The OMA charter is to serve its members by promoting the industry and developing
constructive relations with its primary stakeholders. Its core functions are marketing and
research (including audience measurement), government relations and regulatory affairs,
media relations, and member services.
The OMA is governed by a Board of Directors which is elected by the membership.
The OMA website is www.oma.org.au.
Other useful sources:

APN Outdoor – www.apnoutdoor.com.au

Eye Corp Ltd – www.eyecorp.com.au

Claude Group – www.claudegroup.com.au

Independent Outdoor Melbourne – www.iom.net.au

Outdoor Advertising Advisory Paper and Checklist at www.afa.org.au

The Advertising Standards Bureau at
www.advertisingstandardsbureau.com.au
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Identification of properties
Australian Valuation Property Classification Codes (AVPCC)
To appropriately categorise outdoor advertising signs in a municipality, refer to the Australian
Valuation Property Classification Codes (AVPCC) available at
http://www.dse.vic.gov.au/valuation.
The following codes apply to outdoor advertising signs:

Static Non Electric Advertising Sign (no lighting) – 290

Static Non Electric Advertising Sign (with external lighting) – 291

Electronic Stadium/Street TV Relay Screen/Scoreboard – 293
Outdoor advertising signs that fit into the category of billboards – large format and posters are considered to be separately rateable because the tenants have exclusive occupation of
the sign and are considered to be a separate occupancy. These include Self-standing Pole
Signs, Bridge Fixed Signs, Roof-mounted Signs and Wall Fixed Signs.
Outdoor advertising signs that fit into the category of Transit and Street Furniture are not
considered to constitute a separate occupancy for the purpose of rating. These include
Bus/Tram Shelters and Vehicle Mounted Signs.
Within these categories further consideration should be given to the following items:






number of panels (e.g. single, double)
size of poster (e.g. 6-sheet, 24-sheet)
dual printing (i.e. are the front and rear sides of the sign used for
display?)
illumination – luminescent technology allows illumination of the
sign/poster
LED Screen – enables interaction with consumers
Bluetooth – allows downloads of images and music.
Valuers need to be aware that signage can be short-lived due to changing circumstances such
as varying road patterns affecting traffic flow (or even change of traffic lights) and therefore
prominence of a sign; or a new building constructed or growth of trees that block or impact
on the visibility of the sign. In short the rental returns are directly related to exposure and if
the exposure is reduced, so is the rent.
The majority of outdoor advertising signs are within 15km of the Melbourne GPO.
Most prominent locations are high volume toll ways, freeways and primary (main roads), for
example City Link (Western Link), City Link (Monash Freeway), West Gate Freeway, Kings Way
and Punt Road.
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Types of fixed outdoor advertising signs are as follows:
Self-standing Pole Signs
Bridge Fixed Signs
Roof-mounted Signs
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Wall Fixed Signs
Bus/Tram Shelter Fixed Signs
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Rental questionnaire and property information – specific requirements applicable
to outdoor advertising signs
In addition to the general requirements for rental information, the following is a guide to the
specific information required for outdoor advertising signs.
Property Data
1.
Address/Unit number
2.
Base of Outdoor Advertising Sign
Self-standing pole and pole height
metres
Rooftop
Building wall
Bridge
Other
3.
Tenant ID
Land Lease Details
1.
Commencement date
2.
Lease term
3.
Rent review method
4.
Date of last rent review
5.
Ground rent per annum
$
6.
Outgoings paid by:
Owner
7.
Outgoings amount per annum paid by tenant
$
8.
Outgoings amount per annum paid by owner
$
9.
Does the owner have content control?
10. Who owns the sign infrastructure?
Owner
Tenant
Tenant
11. Estimated cost of construction
12. Year of construction
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Property inspection – specific requirements applicable to outdoor advertising
signs
Inspect outdoor advertising sign and categorise the type of OAS i.e. self-standing pole,
attached to a building, structure etc..
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Methodology
Site value (SV) and capital improved value (CIV)
If a self standing pole occupies a portion of a parcel it is considered to be a separate
occupancy and should be valued accordingly. If the OAS is attached to a building then the
site value and capital improved value attributed to the tower may have to be apportioned in
accordance with Section 2 (3) of the Valuation of Land Act. Refer to Occupancy in the
General Provisions for Specialist Guidelines.
The information in the following examples are not indicative of any market information,
the rents and rates are for example purposes only.
Example A – One Self-standing Pole Sign
Site Value
Ground Rent
$45,000 pa
Net Rent
Cap Rate
Total SV
$45,000 pa
15%
$300,000
Note – A Ground Rent is a rent per annum for the use of the land to construct a selfstanding pole.
Rentals can vary depending if the owner stipulates control over the content of material
advertised. If the tenant does have to seek ‘permission’ from the owner each time the sign or
billboard is changed then the rent would be less than if the tenant had full control over the
advertising material.
Capital improved value
Self-standing Pole and Infrastructure
$100,000 pa
Total Gross Rent
Less Outgoings
Net Rent
Council Rates
EAV
$100,000 pa
$25,000 pa
$75,000 pa
$5,000 pa
$80,000pa
CIV by Summation
Site Value
Pole
CIV*
Assessment
Carrier A
$ 300,000
$ 200,000
$500,000
SV
CIV
NAV
$ 300,000
$ 500,000
$ 80,000
* Note :




The maintenance costs associated with the sign can be high due to the
continual exposure to weather.
The improvement costs (i.e. pole etc) are depreciated replacement costs.
In the event that passing ground rents are provided and there are no other
current market rents to suggest otherwise, the passing rents should be
adopted.
The EAV must be a minimum of 5 per cent of the CIV.
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Example C – Roof-mounted on existing building with a shop on the ground floor, office on
the second floor and OAS on the rooftop.
Site value
Based on zoning and usual land considerations
$250,000
Capital improved value
Shop –
Office –
Billboard -
$80,000 pa
$40,000 pa
$80,000 pa
Total Gross Rent
Less Outgoings
Net Rent
Council Rates
EAV
$200,000 pa
$15,000 pa
$185,000 pa
$8,000 pa
$193,000pa
Cap Rate
CIV
CIV Rounded
Vacancy Allowance
CIV
6.5%
$ 2,969,230
$2,950,000
$50,000
$2,900,000
Apportioned CIV - Shop
Apportioned CIV - Office
Apportioned CIV -Billboard
$ 1,180,000
$ 590,000
$ 1,180,000
Assessment
Shop
Office
Telco
SV
$ 100,000
$ 50,000
$ 100,000
CIV
$ 1,160,000
$ 580,000
$ 1,160,000
NAV
$ 77,250
$ 38,500
$ 77,250
Check Method
The check method by summation is derived by ascertaining the CIV by direct comparison the
deducting the cost of the structure to arrive at a site value.
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Sales and rental analysis

When analysing rental evidence, ascertain if the owner has control rights over the type of
material advertised. If this is the case then the rental is likely to be lower because the
tenant is restricted by having to gain consent on advertising content.

Determine if the rent includes any infrastructure in addition to the physical poles/signs.
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Industry information

Fibre Optic Display
Use of electronic light transmitting fibres to create changeable copy displays.

Illuminated
Outdoor structure with internal or external electrical equipment installed for
illumination of the message at night.

Street Furniture
Produced in 1.8m x 1.2m or 1.5m x 1m sizes and often backlit. Targets include CBD
workforce, entertainment areas and railway platforms.

Mobile Billboard
Usually 6m x 3m (24-sheet) size mounted on a small commercial vehicle or a trailer.
Available nationally, some with illumination and/or loud speakers for playing jingles etc.
Used for retail promotion or special events.

Poster
This is a term used for advertising messages printed on paper and posted onto
advertising structures.
Poster – 24-sheet
The 24-sheet poster (6m x 3m) is a large form of poster located mainly in commercial
and industrial areas and primary and secondary arterial roads. Viewed chiefly by the
occupants of cars and delivering exposure to both local residents and commuter
traffic. More advertising campaigns are placed on this traditional billboard than any
other form of outdoor.
Poster – 6-sheet
The 3m x 1.5m reduction in size maintains the proportion of the 24-sheet poser
which leads to economies in the production of artwork for mixed size campaigns.
Located mainly in suburban neighbourhood locations they often serve as brand
reinforcement at the point of purchase. Viewed by both pedestrians and car
occupants as well as being used in rail transport locations.

Posting Date
The date on which the posters of a showing are scheduled for display. Most plants will
have several posting dates during the month to even their workload and provide a
variety of start dates to coincide with special advertising promotions. Usually first to
fifteenth of the month.

Spectacular
‘Specs’ are the largest, greatest impact of all outdoor media. Top highway and inner city
locations command the erection of these giant, modern, illuminated advertising vehicles.
Ideal for customising messages with cut-outs and extensions. Size is from 15m x 4.5m
up.

Supersite
Large 12.66 x 3.35m illuminated poster sites. Dramatic size on major arterial roads and
national highways. Standard size enables easy rotation of flexible face material from site
to site and market to market.
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