The government’s decision to demand rates from vacant industrial space was roundly condemned by the property industry, as a damaging additional burden on recession-hit developers.
The move, aimed at bringing more than £1 billion a year into the Treasury’s ever-dwindling coffers, was also seen as the catalyst for a subsequent wave of demolition programmes, as owners flattened redundant buildings to avoid paying rates.
However, after the failure of a national ‘empty rates’ campaign to force a U-turn, the imposition of rates was reluctantly regarded as a fait accompli.
However, Bulleys Chartered Surveyors, in conjunction with a Birmingham-based building consultancy firm, can now offer relief to Tenants and Landlords whose factories and warehouses stand empty, by agreeing rating appeals to delete the property from the Rating List.
Mark Linning MRICS, Head of Professional Services at Bulleys Chartered Surveyors, can’t identify the client for confidentiality reasons, but can confirm the Company are a long-established Black Country business, with sizeable property interests.
“The company had an industrial building which had been empty for some time, and had a rates liability of approximately £40,000 a year,” he recalls.
“It was a very delicate situation. My client didn’t want to demolish the building, but didn’t have the surplus finances to refurbish it. Equally, they couldn’t afford to pay such a significant sum in rates when no income was being received from the property.”
As part of the rating appeal process, Bulleys instructed Building Surveyors to prepare a case to present to the District Valuer demonstrating the building had reached the end of its useful economic life and that it was economically unviable to undertake the cost of refurbishment.
As a result, Bulleys argued that the property should be deleted from the Rating List and Building Surveyors were instructed to prepare a detailed cost analysis, identifying how the building needed refurbishing and demonstrating that it was financially unviable to do so.
“Obviously, the District Valuer wasn’t just going to accept our argument for a extinguishment bearing in mind the building had a liability of approximately £40,000 a year, so the grounds for our appeal were checked and double checked by Quantity Surveyors” says Mark.
“At the time of our appeal, there had been very few instances where such appeals had succeeded and our client was understandably delighted when the District Valuer announced that our appeal had been successful’’ recalled Mark.
“A successful appeal is never guaranteed but this case demonstrates what can be achieved. We’re certainly not saying that Landlords will be able to reduce their costs on every redundant industrial building, but it does show what can be achieved with a well researched and presented case’’ says Mark.
“When we were successful with our appeal, we had not fallen into recession but in these difficult times, I think it is important to bring this potential cost saving exercise and others such as void rate relief to the attention of Landlords and Tenants alike” says Mark.
For further information and advice on Rating Appeals, please contact:
Mark Linning MRICS
Head of Professional Services
Direct Tel: 01902 778582