INDUSTRIAL SECTOR SEES RATEABLE VALUES HIKED BY UP TO 70 PER CENT AS 2023 DRAFT RATING LIST IS PUBLISHED
The Valuation Office has issued the 2023 Draft Rating List, with business rates specialists at Harris Lamb seeing hikes of up to 70 per cent in some sectors as six years’ worth of activity has been assessed.
The inevitable effects of the Covid-19 pandemic have seen significant increases in Rateable Values throughout the Industrial and Office sectors, while Retail and Hospitality businesses have seen welcome reductions.
Andrew Hulbert, Director, said: “The Draft rating List has been awaited with some trepidation from the Industrial and Office sectors, not least because of the impact the pandemic had across the board, and there are some definite winners and losers.
“The VO is, of course, reflecting what has happened in the marketplace over the past six years, but there have been some highly unusual circumstances in that time, and many ratepayers are unfortunately going to feel they have been punished as a result of that.
“We have been forecasting significant increases in industrial properties for many months now, and some of those are exponential – we have seen some Birmingham properties facing a 70per cent increase on their Rateable Values based on market trends.
“The market has been driven by the switch to online retail, which led to an increased demand for warehouse space and the ongoing shortage of industrial stock leading to strong rental growth. But these factors do not accurately reflect traditional manufacturers and small businesses who have not benefitted from online retail success and are now exposed to a severe increase in their utility costs,” he said.
Andrew added that the office sector had also been hit hard.
“While we’ve not seen hikes like those in the industrial sector, we’ve certainly seen increases of some 20 and 30 per cents for city centre offices. Even though offices were closed for large portions of 2020 and 2021, six years of rental growth have been reflected in the new RVs,” he explained.
As predicted, the retail and hospitality sectors will likely be the only businesses to welcome a reduction in RVs, which come at the heavy expense of the challenges presented by the pandemic.
“There have been significant reductions across the board when it comes to High Street retailers, while pubs and other hospitality and leisure businesses are also seeing noteable reductions in their RVs. In addition, the government announced increased and extended rates relief measures for these businesses in light of the challenges they have faced over the past three years,” he said.
The new Rating List will come into effect on April 1st next year, and the business is urging ratepayers to study their new RVs and make contact for support.
“There is an opportunity for us to liaise with the Valuation Office ahead of the new List coming into effect, so those businesses that feel their new RV is not an accurate reflection should contact us to intervene on their behalf and challenge them where appropriate,” added Andrew.
Andrew can be reached at firstname.lastname@example.org.