Is your businesses’ rateable value affected by recent changes?
This week has seen the unveiling of the draft list of rateable values for the Government’s 2017 Rating Revaluation, which takes effect from 1 April 2017.
All commercial properties are to have their rateable values re-assessed, based on rental levels at 1 April 2015, and it is these that will be used to calculate liabilities for the next five years.
Business Leader Magazine canvassed reaction:
Lee Halmshaw, Associate at Bilfinger GVA in Bristol comments: “This is long awaited, being seven years since non-domestic properties in England and Wales were nationally revalued.
“The publication of the draft list will provide the first opportunity to understand how the Valuation Office has responded to the challenge of the revaluation. Whether a business’s assessment has increased or decreased, it is important to question whether it’s a fair reflection of the rental market as of 1 April 2015.
“Over the next six months businesses need to be checking their rateable values and informing the VOA of any factual errors. Appeals can be lodged once the new rating list is published next April.”
Lee says that the Government’s revaluation includes a new process for the appeals system in England, introducing a fundamental change to the way rating appeals are heard.
Tim Davis, head of Cushman & Wakefield’s Bristol office comments: “On Friday 30 September, the Valuation Office Agency published draft rateable values in the 2017 Rating List.
“Over the last seven years, the South West retail property market has suffered from inflated business rates liability due to rateable values being fixed on a 2008 valuation date, the very peak of the property market.
“The inflated rates liability arguably hampered both rental growth and occupier demand across the region, and the proposed reduction in rateable values will surely come as a welcome relief for both investors and occupiers.
“From a landlord’s perspective, reductions in rateable value are likely to act as a catalyst for improvements in the property market, reduce vacancy rates and holding costs on vacant properties, and potentially result in rental growth due to additional occupier demand.
“From a retailer’s perspective, reductions in rateable value are likely to reduce overall occupational costs. This may improve business efficiency and allow budgeting for additional space or relocation into superior accommodation than could previously be afforded.
“Reviewing the draft 2017 Rating List from a Bristol-centric perspective, our outline research has found that rateable values on the prime stretch of Broadmead have decreased by circa 13.50%, and by circa 35% on the good secondary stock.
Jeremy Bailey, based at JLL’s Bristol office, comments: “As soon as the new valuations for 2017 are issued, there will be a very intensive period when many businesses will do their sums, and then work with their advisers to prepare appeals against the VOA’s calculations.
“They mustn’t forget though it’s still possible to appeal against the VOA’s assessments made in 2010, which apply until the end of March 2017.”
Bailey says it’s particularly important for appeals against the 2010 valuations to be submitted as early as possible, because the VOA has a massive backlog of appeal cases which have yet to be heard.
He comments: “Like every public sector organisation, it has suffered from six years of austerity, and simply hasn’t got sufficient resources to cope with its current workload.”