Call for action on rates
Edward Cooke, executive director of the BCSC, says there is need for action by the new coalition government in the UK on business rates, to alleviate the cost burden on occupiers – which is stifling the recovery in many areas of retail property.
“The retail sector contributes around £6bn annually towards Treasury’s total rate receipts – more than any other sector,” he says. “In a weak consumer market this cost will affect retailers’ expansion plans and consequently their capacity to employ local people.”
“Increases in occupancy costs, coupled with reduced margins, have affected and will continue to affect an owners’ ability to secure a fair rent. Ultimately, falling or stagnant rents will have an impact on the attractiveness of retail property as an asset class, which could lead to less investment in areas desperately in need of regeneration.”
The retail property body says it will support calls for a mandatory business vote on all proposals where an element of funding comes from a Business Rate Supplement (BRS).
“We also believe that applying full rates to empty retail property is no more than a tax on failure and would like to see this flawed policy reviewed, and ultimately revoked. At the very least we would like the exemption for properties with a rateable value of less than £18,000 extended for the duration of this Parliament,” says Cooke.
The Viewpoint column in this week’s Liverpool Daily Post argues that more should be done to benefit the country’s high streets, either by raising the costs of out-of-town retail parks or by reducing the costs of operating high-street premises.
The paper also calls for warehouses that are serving online retail operations to be “re-rated at prevailing retail warehouse rates and not industrial/storage values”.
“These large warehouses have low overheads, £4-£5 per sq ft rental compared to £25-£75 plus per sq ft for a typical high-street shop plus all the staff costs associated with running a high-street business,” it argues.
